Service Quality and Customer Satisfaction in the Airline Industry: A Comparison between Legacy Airlines and Low-Cost Airlines

Abstract

The purpose of this study was to examine the service quality and customer satisfaction of the top 14 U.S. airlines between 2007 to 2011 using data from the Department of Transportation Air Travel Reports. The objectives of this study were to compare customer satisfaction and service quality with respect to airlines quality dimensions and subsequently to determine the relationships between the dimensions of service quality and passengers’ satisfaction on airlines services. A critical review of the literature revealed that the airline industry has been struggling with many challenges: cutting costs, managing fluctuating demand, keeping up with tight quality requirements while trying to maintain superior services and satisfy the needs of various customer groups. Data were collected from the Department of Transportation's Air Travel Consumer Report on the following measures: percentage of on-time arrival, passengers denied boarding, mishandled baggage and customer complaints. Using a quantitative research method, Microsoft Excel version 2010 was used to analyze the data using percentages, mean and standard deviation. Results indicate that while the traditional carriers are converging toward a higher level of service quality, using the four measures, there continue to be significant variation. In this study, over a five year period 2007 to 2011, the service quality of low cost airlines was generally found to be higher than that of traditional legacy airlines. Implications related to operating costs, market share, infrastructure and customer service were evident.