Has your airlines search ever thrown up search results for Scoot airline (a subsidiary of Singapore Air), Swoop airlines (part of West Jet), Spirit airlines, or Tiger air? Then you already know what low cost airlines are.
Some of the common characteristics of a low cost airlines are
- Primarily point-to-point operations
- Short-haul routes, often between regional or secondary airports
- Limited passenger services, with additional charges for some services (e.g., on-board catering)
- A very high proportion of bookings made through the Internet
- High aircraft utilization rates, with short turnaround between operations
- A simple management and overhead structure with a lean strategic decision-making process
There are quite a few more but mostly relevant to aviation industry. I picked these only because I see a lot of similarity between these low cost airlines and Xemo. The similarities are deep rooted in the operations and philosophy of both kinds of business
Let go through each of these items one by one
- Primarily point-to-point operations – Xemo aims to run point to point non-stop shuttles between two places. If you want to board Xemo you will have to come to a nearest convenient Xemo stop (which we call internally as Xemo hub) and alight at a specific Xemo stop. Xemo already has designated Xemo pick up and drop off locations which integrate with existing infrastructure like Train stations or on Fringes of Mel CBD. If we do not have one that is convenient to you we have a “crowd start” a new route option in our app as well.
- Short-haul routes, often between regional or secondary airports – Xemo make similar arrangements with its suburban friendly shuttles which means that you can continue to use the Mel metro if that is most convenient way to get into CBD and use the Xemo service for short haul – home to station. Also we will probably not run A Xemo within the 10/15 km radius of Melbourne CBD because it may not solve any of the problems that are commuters face currently like that of traffic congestion, service disruption or reduced time from point A to point B.
- Limited passenger services, with additional charges for some services (e.g., on-board catering) – Obviously only a part of this principles applies to Xemo (since local commuting does not require catering or in-flight entertainment services). We open our services only on those routes where we have enough and consistent demand. To keep our operational costs minimum we have to rely upon a consistent demand hence we encourage our guests to “crowd start” a service to main consistency of service.
- A very high proportion of bookings made through the Internet – Xemo is essentially a demand aggregation and booking platform. Hence it is prudent that we built smart technology solution to meet all customer needs such as – establishing new routes, bookings, scheduling, tracking, payments and customer service as well.
- High aircraft utilization rates, with short turnaround between operations – Running multiple shuttles within the same route during peak hours is how we ensure maximum utilization of assets for our operators.
- A simple management and overhead structure with a lean strategic decision-making process – being a technology startup based on kick starter concept (by crowd starting shuttle service routes) the Xemo team makes pragmatic and practical business decisions instead of popular decisions.