Airline Revenues 2035: Revenue Generation and Business Models in Commercial Aviation - A Scenario Study

In the airline industry, increasing shares of low cost carriers, market consolidation, and high profit volatility require a rethinking of business models. This paper evaluates business model innovation to tap additional revenues and to remain competitive. The applied scenario-based analysis considers multiple factors influencing the future airline sector, e.g. changing passenger expectations. Combining the various characteristics of these factors in a plausible and consistent way yields a range of scenario frameworks. The development within each scenario provides the basis for evaluating new airline business opportunities and revenue sources. The scenario analysis and the implications for the airline industry show that digitalisation is one of the main drivers for changes within this sector. In order to facilitate a seamless journey, service providers and products along the travel chain see increased need for sharing and accessing relevant data. Furthermore, airline business models can take different shapes, ranging from integrated door-to-door services to a mere provider of the physical assets. The approach and results within this paper contribute to a more detailed understanding of future challenges and opportunities for the airline sector. Being innovative and answering to passenger expectations provides the potential for a competitive advantage and resulting ancillary revenues. The discussion of potential new business models broadens the current discussion circling around low cost carriers and full service network airlines.     «

In the airline industry, increasing shares of low cost carriers, market consolidation, and high profit volatility require a rethinking of business models. This paper evaluates business model innovation to tap additional revenues and to remain competitive. The applied scenario-based analysis considers multiple factors influencing the future airline sector, e.g. changing passenger expectations. Combining the various characteristics of these factors in a plausible and consistent way yields a r...     »