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No-frills airlines out-perform major carriers

Associated Press
A new study of airline quality shows that no-frills airlines generally provide better customer service than traditional carriers.

The annual airline quality rating explains why low-cost carriers like Southwest and JetBlue are taking customers from the big airlines, its authors say.

It "adds further evidence to the emerging performance gap between the legacy carriers and the no-frills network carriers," said Brent Bowen, director of the University of Nebraska's aviation institute and a co-author of the study.

JetBlue had the second-best on-time performance, arriving punctually 86 percent of the time. Its passengers also filed fewer complaints – 0.31 per 100,000 – to the Transportation Department than all other airlines but Southwest.

Southwest, with 0.14 complaints per 100,000 customers, consistently generates the lowest complaint rate in the industry, the report said.

Continental and Northwest were tied for most complaints, 0.95 per 100,000 customers.

Dean Headley, a study co-author and associate professor of marketing at Wichita State University, said most of the low-cost carriers were above the industry average on four performance indicators last year. Most of the traditional airlines were below the industry average, he said.

"The low-fare carriers are definitely solid in their ability to attract passengers, and it shows in the market share gains that they're making," Headley said.

He said low-cost airlines comprised 4 percent of the market when he began the study in 1991. Now they carry one-quarter of all passengers; Headley expects them to transport four in 10 by 2006.

The report rated the 14 U.S. airlines that carried at least 1 percent of the 587 million passengers who flew last year.

Four low-cost carriers – AirTran, ATA, Atlantic Southeast and JetBlue – met that threshold for the first time in 2003.

Alan Bender, an aviation professor at Embry-Riddle Aeronautical University in Daytona Beach, Fla., said the traditional airlines will still offer something that the low-cost carriers often don't: connecting flights to any commercial airport on the planet, first-class service and frequent flier miles.

"This doesn't mean the high-cost carriers are down and out," Bender said. "The survey seems to count out the fact that a large percentage of business people need ubiquitous service at any time of day."

He also said American travelers are addicted to frequent flier miles. "Business travelers will avoid low-cost carriers because they're not going to get miles that will take them to Hawaii," he said.

The report was based on Transportation Department statistics.

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