“Vision unlocks what was and what is to propel you into the land of what would be”
The complexity of airlines ecosystem is as such that not all
airlines end up chasing the same dream.
In Part 1, we looked at the complexity of the ecosystem and
the breadth of the global value chain. In this post, we look at the vision
layer.
Vision defines the ambition. The North Star metrics tell if
they are on track. The business model choices shape financial outcomes.
What is the vision in Airlines?
An Airlines vision sets its strategic purpose: Why it exists
and how it wants to be seen.
Airlines operates at different contexts and their visions
naturally emphasize different ambitions. Their priorities, their strategic
alignment, stakeholder expectations and their clarity of differentiation all
factor in.
Dimensions of airlines vision: National Identity/Flag
carrier purpose, Premium brand positioning, Low-Cost democratization, Connector
Hub vision, Sustainability Leadership, Customer Experience Disruptors, Cargo/Logistics
Specialists
National Identity/Flag carrier purpose – Rooted in
national pride and connectivity. Airlines are highly visible national symbols.
Customers feel at home in their national airline, an emotional bond. They are
strategic assets providing economic contribution to the nation, contributors to
GDP. Government sees them as economic multipliers. Purpose of servicing the
nation representing the nation abroad with safety, service and reputation.
Premium brand positioning – Product and Service
excellence. Premium cabins can generate 2-3X more revenue per seat. In order to
differentiate, a distinct identity where basic flying can feel like commodity.
Premium traffic also promises luxury and better travel especially in the long-haul
space, higher margins, stronger loyalty, corporate access, and brand power.
Low-Cost democratization – Affordable access for the
masses. Historically, flying was for the wealthy or corporate travellers, by
lowering fares airlines tap in to vast and under served customer base. Cheap
fares stimulate demand and enable high-frequency flying. Champion of access. A
downturn survival strategy. Sometimes bypass congested Hubs.
Connector Hub vision – Being the
bridge between continents. Leverage the location or geographic advantage point,
traffic aggregation helps with demand to fill the widebody aircraft
efficiently, Hubs also allow for banked waves of flights – efficiencies in
aircraft utilization, slot use etc. more destinations served with fewer
aircrafts.
Sustainability Leadership – Decarbonization as the
central narrative. Aviation faces mounting climate regulation ICAO’s CORSIA,
EU’s Emissions trading system, New Zealand net-zero 2025 pledge, Get ahead of
compliance, ESG is central to access to capital – Green bonds, financing terms,
investor who screen for ESG, changing dynamic of customer and corporate mindset
in terms of climate impact, carbon criteria in airline procurement, green
fares, SAF contributions, carbon calculators, Innovation and Future proofing –
SAF, Hydrogen, Electric etc. and be a new entrant competitive differentiator.
Customer Experience Disruptors: Redefining service or
loyalty ecosystems. Differentiation in commoditized industry, reason to choose
an airline, unique seating, inflight experience touches like Wi-Fi
availability, better food options, Value innovation
Cargo/Logistics Specialists –Resilience in downturns
such as reduction in passenger travel during COVID, High-Margin adjacency –
Cargo, especially specialised freight can yield higher per kilo than passenger
revenue per seat, urgent Cargo – Pharma, perishables etc. good alternative revenue
stream, trade enabler, E-commerce & Integrator competition, Fleet
utilization and Flexibility – Cargo Operations extend asset life, and better
utilization of flight belly space
At the enterprise level, the articulation of an airlines
vision is not simply an aspirational statement but a strategic anchor that
cascades into financial architecture, capital allocation, balancing short-term
volatility with long-term strategic differentiation and the overall risk
posture. The breadth of strategic dimensions ultimately manifest in the
airlines operating model, balance sheet resilience, and margin profile. In this
way, the process of arriving at a vision is inseparable from shaping an airlines
global mindset.
Let’s now look at the vision statement examples of few
airlines:
Air New Zealand: “Creating the best flying
experience on earth; enriching New Zealand by connecting its
people to each other and the world”
Vision Anchor: Distinctive for
blending customer experience and national identity and enrichment.
Singapore Airlines: “Providing air transportation of
the highest Quality”
Vision Anchor: Premium,
Service-led, product-innovation vision.
Qatar Airways: “Excellence in everything we
do; to be the world’s best airline”
Vision Anchor: Global Hub premium
carrier vision.
Ryanair: “Low fares, made simple –
Europe’s greenest, cleanest airline”
Vision Anchor: Vision built
around Ultra-low cost, efficiency, and Sustainability
Delta Airlines: “No one better connects the
world”
Vision Anchor: Connector Hub,
Scale, Reliability, loyalty monetisation.
Turkish Airlines: “To be the leading airline
in the world with unrivalled flight network”
Vision Anchor: Connectivity hub
dominance
Air France KLM: “Towards more responsible
travel while connecting France, the Netherlands and the world”
Vision
Anchor: Sustainability led, premium-European dual Hub
United Airlines: “Connecting people. Uniting
the world”.
Vision
Anchor: Global connectivity.
Lufthansa Group: “We connect people, cultures,
and economies – Sustainably “
Vision
Anchor: Multi-brand ecosystem with sustainability leadership
Qantas: “The Spirit of Australia”
Vision
Anchor: National Identity and Dual Brand strategy with Jetstar.
Business model
changes from the type of fleet it operates, to the routes it flies, the
customers it targets, and the way it earns revenue beyond tickets (Loyalty,
Cargo, Ancillaries). Vision shapes these choices directly: an airline that
aspires to be a premium global brand will design a full-service model with
widebodies, alliances, lounges and loyalty ecosystems, while a carrier whose
vision is to democratize travel will build a lean low-cost model with high
utilization single fleets, and unbundled fares. In this way, vision acts as the
compass, and the business model becomes the operating blueprint that turns
ambition into economic reality.
Business Model Choices & Financial Impact
Full-Service Carriers (FSCs): Airlines that offer a
full suite of products – multiple cabin classes, Loyalty programs, Lounges,
Global alliances, and both short- and long-haul flying. They balance premium
service with scale, appealing to both corporate and leisure travellers. Margins
rely on premium cabins and loyalty. They target both premium and mass markets
and often carry national identity
Example: Singapore Airlines, Air New Zealand,
Lufthansa
Direction: FSCs compete on service, scale and loyalty
ecosystems.
Revenue: Passenger fares, Cargo, Loyalty
Strength: Premium Yields, Loyalty
Weakness: Complexity, High CASK
Financial Impact: Risk > CASK spead, reliant on
premium cabins and Loyalty monetisation.
Low-Cost Carriers (LCCs): Airlines built on
simplicity, efficiency, and low fares. Single-class cabins, quick turnarounds,
high utilization, and stripped-down services form the backbone. Ancillaries
like seat selection, bags and food drive profit. Thrive on volume, No frills,
with Ultra-lean cost bases.
Example: Ryanair, Indigo, AirAsia.
Direction: LCCs win by keeping costs low and planes
flying full.
Revenue: Ancillaries, high-density seating
Strength: Lowest CASK, high utilization
Weakness: Less diversification, vulnerable to fuel
swings.
Financial Impact: Profitability driven by scale and
ancillary revenue per pax.
Ultra-Low Cost Carriers (ULCCs): The extreme version
of low cost. Base fares are rock bottom, everything else is sold separately.
ULCCs maximise ancillary revenue, often earning more from extras than from
tickets themselves. Model depends on ancillary revenue often making up 40% of
total income.
Example: Spirit, Wiz Air, Viva Air
Direction: ULCCs turn flying in to supermarket of
add-ons.
Revenue: Ancillary heavy
Strength: Extreme cost discipline
Weakness: Customer backlash, regulatory risk
Financial Impact: Thin fare yields offset by 40% and
ancillary contribution.
Hybrid Carriers: Airlines that mix low-cost DNA with
selective premium features. They may offer extra legroom cabins, business class
products on key routes, or loyalty programs, while still operating leaner than
legacy FSCs. Mix elements of FSCs and LCCs, positioned to attract both budget
and value seeking premium travellers.
Example: JetBlue, WestJet, Virgin Australia
Direction: Hybrids balance value with experience –
but must avoid identity confusion.
Revenue: Mix of LCC fares and premium cabins
Strength: Flexibility, brand appeal
Weakness: Identity risk, margin dilution
Financial Impact: Mid-Point margins, must avoid
complexity creep
Group Multi-Brand Models: Airline holding companies
that manage a portfolio of brands – often combining FSCs, LCCs, and Cargo arms
under one umbrella. This diversification helps them serve different markets and
spread risk. Holding companies that manage both FSCs and LCCs. Spread risk
across segments and markets but face integration complexity.
Example: IAG(BA, Iberia, Vueling, Aer Lingus),
Lufthansa Group, Air France-KLM
Direction: Groups compete by being more than one
airline at once.
Revenue: Diversified portfolios (FSC + LCC, Loyalty +
MRO + Cargo)
Strength: Risk diversification, Synergies
Weakness: Integration Complexity
Financial Impact: More Resilient to shocks, but
integration costs eat margin.
Cargo/Integrator Specialists: Carriers dedicated to
freight or specialised aviation services. They thrive in Cargo-intensive
markets (e-commerce, Pharmaceuticals) or provide niche services like charters,
business jets, or integrator-style logistics.
Example: FedEx, Qatar Airways Cargo, Atlas Air,
Korean Air Cargo
Direction: Cargo carriers keep the world’s goods
moving – often more profitable than passengers.
Revenue: Freight tonnage
Strength: Resilience in downturns, e-commerce growth
Weakness: Cyclical with trade volumes
Financial Impact: Can deliver higher margins than
passenger airlines in down cycles.
Closing Thought:
Vision gives airlines their north star, North Stars define
the scorecard, Business model choices turn that vision into financial reality
Airlines succeed or fail not just on operational excellence,
but on the clarity of their vision, the sharpness of their business model
choices, and the focus on their North Star. A vision sets the ambition, a
business model defines the playbook, and the North Star keeps the airline
honest about whether it is delivering on both. Some airlines choose global
connectors, others democratizers of travel, and others champions of premium
service or sustainability. Each path comes with trade-offs Scale versus focus,
cost versus experience, growth versus resilience. The real test is not in
choosing everything but in choosing decisively and aligning every part of the
enterprise to that choice.
In Part 3, we will explore how these visions are
operationalised.
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