Dynamic packaging spells the end of European charter airlines

Abstract

The charter airline industry is showing rapid decline in the short-haul markets, whilst in the long-haul markets it remains far more resilient. Passengers now have the ability to self-assemble their own tailor-made package of travel products such as flights, accommodation, car rental, insurance, airport parking, ground transportation and tourism amenities from an airline’s own e-commerce platform through mechanism known as dynamic packaging, which are bundled items that charter airlines offered as a holiday package. A passenger survey was conducted at the international airport in Malta, which is a key sun-and-sand tourism destination earmarked by tour operators for holiday packages for decades, which sought to analyse and measure the willingness of passengers to purchase various travel-related products from an airlines’ website. It was found that over one-third of the sampled passengers were willing to purchase additional travel-related products beyond the flight, which has damaging consequences for charter airlines.