Study of the evolution of routes operated by an airline going into bankruptcy: the case of Spanair

Student

Cristina Alemany

Supervisors

Oriol Lordan / Jose M Sallan

Defense date 

11th Abril, 2014

Abstract

The aim of this project is to analyze the competitive dyamics that evolve when an airline goes bankrupt. The cease of operations of the bankrupt airline gives an opportunity to the rest of airlines to increase the market share of the routes covered by the airline. If the bankrupt airline belongs to an alliance, these routes may be covered by other members of the aliance, competitors or airlines operating on a point-to-point basis.

This project analyzes in depth the case of Spanair, an Spanish airline went bankrupt on January 2012. The route portfolio of the company of the period January 2010 - January 2012 is considered for analysis. Results shows that LCCs (Vueling and Ryanair) and FSC from onewold (Iberia) and SkyTeam (Air Europa) absorbed the market share left by Spanair. Other companies from Star Alliance absorbed a fraction of the international routes of Spanair, but none of the domestic routes. Currently Star Alliance has a weak position in Spain, since there is no local airline in this alliance.