Long-haul airlines are facing low cost competition

Virgin Atlantic is fighting back against the rise of low-cost competitors with its first hand-baggage only ticket for those wanting a cheap flight across the Atlantic. The UK carrier, founded by Sir Richard Branson, yesterday announced plans to launch three new economy fares as it looks to defend its position in the market from long-haul budget rivals such as Norwegian Air Shuttle. Traditional transatlantic carriers are under increasing pressure from low-cost airlines such as Norwegian and WestJet, which have disrupted the market for long-haul travel in the same way that Ryanair and easyJet have done for short-haul in Europe… Norwegian, in particular, has become a force in the European airline industry over the past few years, bringing down the cost of long-haul flying and forcing rivals to respond with their own budget services. Last year, International Airlines Group, which owns British Airways, launched Level, a low-cost transatlantic brand in response to this competition. Last week, the group also announced that, from April, it will introduce a basic hand baggage-only fare for transatlantic flights on BA and Iberia, its Spanish airline brand. Yesterday, Virgin Atlantic outlined plans to compete on similar ground, offering three new economy price tiers: “economy delight”, “economy classic” and “economy light”… The move comes at an important time for Virgin Atlantic. Once a trailblazing carrier, the UK airline has struggled over the past decade. 
Tanya Powley