Budget Airlines – how it all started

Budget airlines, some of which are much maligned, have opened up the world to us, making it much more possible for us to travel to every corner of the globe. Here’s a quick history of no-frills airlines:

These days it’s hard to imagine a world without budget airlines. Whether it’s a 24-hour business trip or an escape to a city for a few days, the budget airlines are for the most part, everyone’s saviour, if not always our best friend.

Plagued in recent years by bad press about poor customer services, expensive (and sometimes compulsory) add-on services and employee disputes, budget airlines have come under fire from the media and traveller.

However, have you ever wondered how it all started? Let’s take a look back down memory lane to see where it all began with two of the biggest names in low cost air travel.

Back in 1984, Ryanair was renowned for their customer services – yes, really! If a flight was delayed, customers would be given complimentary refreshments. However, as a result of its focus on customer service, the airline wasn’t making any money; in fact it was losing millions. So its founder, Tony Ryan, brought accountant, Michael O’Leary, into a somewhat troubleshooting role. O’Leary’s initial advice was to shut the airline down before it went bust. However, Ryan insisted that O’Leary look at other airlines’ business models that were making money.

O’Leary set off to America to look at operations at Southwest Airlines, and headed back with advice on what was to become the future of Ryanair – fast turnaround flights, at regional (and cheaper) airports, with no frills attached – basic flying at a cheap price. Even in-flight meals were axed, with snacks available for a revenue-generating charge instead.

Today, Ryanair has grown to become one of the pioneering founders of cheaper air travel. However, after much upset with staff and customers, the airline is currently undergoing a review of the amount of ‘frills’ it’s taken away, with a view to actually reintroducing them, as passenger numbers decline and profits fall. O’Leary, the airline’s current Chief Executive Officer, is on a charm offensive to turn the fortunes of the once leading airline around.

Ten years later, in ‘flies’ Stellios Haji-Ioannou, with his own answer to a budget, no-frills carrier – easyJet. With no experience in the aviation industry, he was funded by his shipping tycoon father, and re-wrote many rules on air travel, however he used Southwest Airlines as his inspiration.

To start, he cut out the travel agent and got passengers to book directly with the airline. What’s more, in a bold move, not initially supported by Stellios, the airline was the first to trial direct online bookings.

As it grew and grew, it set up bases in 23 European countries, its largest being at Gatwick Airport.

easyJet benefitted greatly by the TV show, Airline, which was a fly-on-the-wall documentary of the airline’s staff and operations at its Luton Airport base – the ultimate PR coverage, as viewers found a love for airline, but mostly the employees.

Over the last few years the airline has shifted its focus on key markets through business travellers and has increased its holiday offerings as short breaks become hugely popular with travellers.

As a result of the huge successes of budget airlines, such as Ryanair and easyJet, many other airlines have shifted their focus. Monarch Airlines introduced a new business model some years ago, focussing on cheaper flights to key city-break, business and sunshine destinations. BA even moved into offering cheaper ‘no frill’ fares on key European routes. Flybe, bmi and bmibaby also followed suit by entering the market place with cheaper, no frills air travel.