LCC Passengers’ Willingness-to-Pay for the Baggage Check-in Additional Service: A Case Study on the Taiwan-Japan Route

Abstract

In recent years, low cost carriers have continued to expand in the routes of the Asian region, resulting in fierce competition in the aviation market; traditional aviation is no longer the only choice for travel abroad or business trips. Different from the traditional mode of operation, it reduces the non-essential expenses of airlines. Based on the concept of payment by users, it allows passengers to have options for relatively low ticket prices. However, in order to continue to operate in this highly competitive aviation market, various airlines have introduced distinctive “value-added additional service” to attract passengers, and in-depth discussion of the value of the service is the main contribution of this study. The study discusses the selection behaviour of passengers travelling to Japan on the value-added additional service. It is mainly aimed at the Japanese route passengers who take low-cost flights as the study subject, and uses questionnaire surveys to understand the key factors influencing whether passengers at the Taiwan Taoyuan International Airport select the baggage check-in value-added additional service and their willingness to pay; in the study, the Double-Hurdle mode was adopted for analysis and organization. The conclusions and recommendations of this study can be used as an important reference for future domestic low cost carriers in marketing and pricing strategies.