The fact that Grayling’s comments came on the same day as a terrorist attack on London underlines the threat posed. Nevertheless, so many questions remain unanswered: why are the destinations covered different to the U.S.? What about those traveling with hand luggage only? What about insurance? For the moment, there is plenty of confusion.
It's been a quick turnaround for IAG, which only announced plans for a low-cost, long-haul airline in December. The legacy carriers have clearly been spooked by Norwegian's initiatives and are now working to compete in this new landscape.
Making history as the world’s first low-cost carrier alliance is one thing. Will history judge the U-FLY alliance, comprising five LCCs in North Asia, as a game-changer that’s able to get fiercely independent players to work together?
This will be a good test. There's no doubt people love low fares, and Norwegian Air will be using a cost-effective aircraft. But is there enough demand from smaller U.S. airports to sustain flights to Europe?
Just as Norwegian Air has on trans-Atlantic routes, Air Asia X might disrupt established trans-Pacific players and push down fares. But making money on long-haul flights is tricky, and Air Asia X might decide it has better options closer to home.
Lufthansa Group has been more insulated from low-cost competition than most of Europe's legacy airlines. That's quickly changing, and the company needs to get its plans in order. It must find a way to turn its Eurowings operation into a more nimble competitor with lower costs.
Spirit Airlines had to reduce its guidance for 2017 following storm-related cancellations in early 2017. This represents a blip on the radar for Spirit, but questions remain about how Spirit will cope as legacy carriers introduce lower fares to compete.