Low Cost Airlines – Insolvent During the Financial Crisis?

After the low cost airline company SkyEurope went bankrupt, there are many other companies likely to become insolvent till winter due to the worldwide financial crisis. Nick Cunningham, analyst for Evolution Securities, claimed that the most unprofitable seasons of the year are the end of summer and the beginning of winter when many low cost airline companies which are struggling to overcome the financial issues might disappear. During the warm periods of the year and the holiday seasons, these low budget airline companies gain a lot of profit. Cunningham added that is this business is not working at the moment, than it is very probable for them to shut their doors until the cold season comes.

Easy Jet - profitable low cost airline company during crisis
Easy Jet – profitable low cost airline company during crisis
Besides the austro-slovakian company SkyEurope, there are many other to follow the same path. SkyEurope was founded in 2002, after the transportation crisis stroke when the September, 11th events occurred. Since the beginning of the crisis, in September 2008, the number of cdiminished considerably. Giovanni Bisignani, director general of International Air Transportation Association, said that this is the worst crisis they deal with.
In July, the international passenger flights decreased by 2,9% against the same period of the last year. For the greatest low companies, which were founded in the 80s and 90s, the crisis may prove, however, full of advantages. The Irish airline company Ryanair and the British company Easyjet were among the least affected by the crisis, than Lufthansa, Air France and British Airways. In order to save money, many clients choose to book low cost tickets. These airline companies had many sale promotions and new destinations, which draw many travelers‘ attention.

Sky Europe - insolvent low cost airline company during the financial crisis
Sky Europe – insolvent low cost airline company during the financial crisis

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