The aviation sector is rather infamous for seeing high rate of exists by the new ventures. The ventures will start, work on for a while and then, due to a competitive market and more players, often even out in a few years and then close the shop. Worldwide, there have been many instances of airlines shutting their shops within a decade or two of their operation. Only some of better managed carriers are able to consolidate on their gains and go on from strength to strength. One of the prime reasons for debacle of airline companies is the competitive pricing of the air tickets and to an extent that lacks rationale.
Since people do look for cheap flights and cutting down on prices of tickets is one of the best ways to quickly build your market and gain more passengers on your flights, carriers around the world often come out with the ridiculously low air fares in order to garner more market share. The carriers which are profitable and have deep pockets are often able to outdo their competitors using price cutting, over a period of time. The poor competitors are left with the only option of going on reducing their fares to try and match those of the bigger players. The result is quick bundling out of the carrier from the market due to uneconomic operations.
Experts point out that this strategy shall be used very discreetly and instead, the airline shall focus on other methods of getting more market share, even if it means redefining its target market afresh. These methods could be involving product differentiation to make the product better than those of the others.