Low-cost long-haul airlines were already in financial trouble before the coronavirus pandemic hit about a year ago. Primera and Wow Air had gone bankrupt in 2018 and 2019, respectively, and Norwegian Air had been struggling for a long time.

The pandemic has disproportionately affected travel industry – leisure and hotel jobs cratered in March with only some recovery since then. And this week, Norwegian Air announced it would cease operating long-haul flights.

“Due to the impact of the COVID-19 pandemic on the aviation industry, including ongoing travel restrictions and changing government advice,” the airline wrote, “Norwegian made the decision difficult to interrupt the operation of its long-haul flights “.

You may never have flown in Norwegian, but you owe them a lot if you’ve taken a transatlantic flight, Scott Keyes, founder of Scott’s Cheap Flights, told Yahoo Finance.

“Even if you never fly with low cost airlines, you owe a huge debt of gratitude for the impact they have had on lowering airfares for all carriers – not just on the budget,” he said. Keyes said. “This is one of the main reasons why the ball has started on the“ golden age of cheap flights ”. “

The airline industry is renowned for its competitiveness and this competition affects prices to a degree generally unknown for consumer-oriented goods and services. The most important factor in determining ticket prices is what competitors charge, Keyes said. And for most consumers, there’s nothing more important than price – something Norwegian has capitalized on with rates sometimes as low as $ 300.

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With the pandemic taking its final blow to already profit-making long-haul service, significant downward pressure is removed for other carriers who would otherwise have had to lower their prices to stay competitive – a bad development for any budget-conscious traveler .

Before Norwegian’s long-haul entry brought prices down in 2014, Keyes said, transatlantic round-trip flights often cost around $ 1,000. Fortunately for travelers, prices for long flights are unlikely to revert to a pre-Norwegian pattern.

“I don’t want to be pollyannaish,” Keyes said. “It’s not a good development for the cheap flight enthusiasts of the world, but I don’t want to overestimate and say, ‘it’s going to be back to what it was before 2014.’ ‘

Instead, the way forward is more nuanced with average transatlantic fares rising perhaps from $ 100 to $ 150.

“I wouldn’t say the golden age of cheap flights is over,” he said. “There will still be $ 300 flights to Europe, but maybe less often, and maybe more than $ 1,000 in fares due to less downward pressure.”

According to aviation analyst Robert W. Mann, long-haul international flights will still be “cheap” even without Norwegian due to the suppression of pandemic demand, at least in the short term.

The future of long-haul “budget” travel

In the past, airlines relied heavily on economy fares, but today, with credit card and points partnerships, control of freight and logistics and business travel, economy fares are just one tool among many.

They take so much advantage of these other factors, Keyes said, that economy seats are almost like “gas money” for some airlines. In addition, he added, before the arrival of low-cost airlines like Norwegian, the basic economy category was not widespread – Delta launched it in 2012. The major airlines added this category. to compete with the upstarts.

“Heritage [airlines] have adopted basic economic activities – all airlines are low cost airlines, ”he said. “There is not a great distinction.”

This, combined with the fact that low fares have proven to be useful loyalty and marketing tools to attract and retain passengers, means that “cheap” flights may still have a future.

Another potentially bullish factor is that while successful economy carriers have not gone long-haul, they have made more and more medium-haul trips as planes become more efficient.

This is a good sign, but according to Mann, most of the efficiency gains associated with regional short and medium-haul travel from ultra-low-cost carriers “evaporate on long-haul routes, particularly international routes. intercontinental, where formalities and full supplies are long. turnaround time.

“The low cost, super low cost long-haul carrier model has never really proven itself, and not just on the Atlantic,” added Mann.

On top of that, the fact that RyanAir and other budget airlines fully mastering the short and medium haul have not dipped their toes into the long haul is another warning sign for airlines to low prices looking to offer longer flights.

While Keyes and Mann are pessimistic about the long-haul business model, there is a wild card. Aviation history is filled with volatile and visionary personalities, from Herb Kelleher of Southwest to Michael O’Leary of RyanAir, Richard Branson of Virgin and Bjørn Kjos of Norwegian. There is an appeal in the business that allows a courageous soul with a touch of pride to be a game-changer.

“It’s not likely or possible, but Elon Musk could decide he wants to set a thousandth of his personal fortune on fire to create an inexpensive way to travel long distances and that could eat into a ton of market share. “said Keyes. “The airline industry has been largely pushed forward by visionaries, although some admit that by doing so, they could turn their billionaire status into millionaire status. But it’s a bit of the double-edged nature of being a visionary.

If a “new Norwegian” were to disturb, don’t expect it to be anytime soon, Mann said.

“It will be a few years before airfares go back to four digits in the summer, which is historically when new entrants start thinking about joining the fray,” he said.

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Ethan Wolff Mann is a writer at Yahoo Finance who focuses on consumer issues, personal finance, retail, airlines, and more. Follow him on twitter @ewolffmann.

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