Buying from archrivals Boeing and Airbus means Lion Air enjoys competitive pricing for jets and replacement parts. And price matters, because Lion Air's marketing message to travellers is: we provide 'value for your money and better quality service, because travelling in a premium airline doesn't have to come at a premium price'. The new jets are highly fuel-efficient and therefore will have lower operating costs than older jets, a key consideration as Lion sets 'value' prices for consumers on holiday and businesspeople who must travel.
Currently, Lion Air is not allowed to operate in the EU or US because of safety concerns. However, the airline is launching longer-distance routes with its new planes and competing more directly with AirAsia and other well-established rivals. In fact, AirAsia is following its own expansion strategy to enter new markets with a budget positioning.
Price wars may emerge as local and non-local carriers fight for awareness, preference and market share. Meanwhile, if Lion remains on its flight path, it will become one of the world's 10 largest carriers (measured by size of fleet) by 2025.
