Passenger Volumes Post-accession to the European Union: Signs of Southwest Airlines' Model in Central and Eastern Europe

abstract: In 2004 the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Slovakia, and Slovenia joined the European Union (EU) as part of the EU's greatest enlargement to date. These countries were followed by Bulgaria and Romania in 2007. One benefit of joining the EU was the freedom for residents in the new EU member states to migrate to western European nations, notably the United Kingdom (UK). A result of this new freedom was an increased need for air travel. The intersection of the expansion of the EU with the introduction of low-cost airline service was the topic addressed in this study. Yearly traffic statistics obtained from the UK Civil Aviation Authority were used to formulate a trend line of passenger volume growth from 1990 to 2003. Through a time series regression analysis, a confidence interval was calculated that established that, beginning with the year 2004, passenger volumes exceeded the probable margin of error, despite flat population growth. Low-cost carriers responded to these market conditions through the introduction of new flights across the region. These carriers modeled themselves after Southwest Airlines, a strategy that appeared to be more effective at meeting the needs of the post-accession travel boom. The result was a dramatic rise in both passenger volumes and low-cost airline routes in an east-west direction across the continent.Dissertation/ThesisM.S.Tech Technology 201