Airlines match demand (ticket sales) with supply (available seats). The airline’s economic survival depends on this process, so let’s take a moment to get it right.
If 1000 people want to travel, the airline will put 1000 seats on the city-pair route on that day. That means big wide-body jets, right? Well, not necessarily.
Those thousand people all want to travel at different times on that day. Given that the flight will only take an hour or two, they are quite picky about time of travel. We can say that demand is highly elastic depending on time of departure.
So to maintain demand, the airline has to offer travel at just the right time. 200 people want to travel at 9am, 200 at 10:30am, 200 at midday, and so on.
So an airline operating short sectors will have to offer frequent services on smaller aircraft.
What about international sectors?
Another thousand people wanting to travel on a particular day. But, because they’re going overseas and will be spending many hours in flight, they are much less picky about time-of-day. However, most of them are very picky about price – in fact if the price goes up they may not travel at all! We can say that demand is highly elastic depending on price.
It is a fact that the cost per available seat-kilometre (CASK) decreases as aircraft size increases. It costs less (per kilometre) to put 500 passengers on one big jet than on three small jets, even if all seats are filled.
The airline will offer only one service per day on one big wide-body. The time of departure is not ideal, but everyone loves the price and will travel anyway.
So an airline operating long sectors will tend to offer less frequent services on much larger aircraft.
There are several variables I haven’t mentioned. One of them is type of passenger. You might already be thinking, what about premium passengers?
They care about time of departure and other comfort factors, but not so much about cost. For this reason, an airline spends a great deal of money on marketing to attract regular premium customers. This increases costs (lounges, status point schemes, quality aircraft, frequent departures etc) but also reduces elasticity of demand, meaning more regular and predictably seat sales