Low-Cost Airlines Not Second-Rate

JetBlue was No. 1 in quality among U.S. airlines in 2003, the first year that it carried enough passengers to be ranked, according to an annual study released Monday.

The budget carrier had the second-best on-time performance, arriving punctually 86 percent of the time. So few JetBlue passengers were bumped that they did not register in the statistics used by researchers. Also, JetBlue customers 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, was rated as the No. 3 carrier in the report.

Alaska Airlines came in second, America West fourth and US Airways, ranked No. 1 last year when it was still in bankruptcy, was fifth.

Northwest Airlines, which came in sixth, was the most improved airline in 2003. It ranked ninth in 2002.

The study's authors said the ratings showed that low-cost airlines are gaining market share because they perform well in ways that are important to their passengers.

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.

Dean Headley, the other co-author and an 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 do not: connecting flights to any commercial airport, 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.