This has likely been discussed, and may even be on the list for the next AE, but I'd suggest frequent flier programs be added as a way to build customer loyalty.
SPECIFICALLY, I'd propose a model similar to the marketing tab where you have a scalar percent of revenue that can be selected to be your Frequent Flier Program expense, with a higher percent giving a better program. For each level of "better" program you get, you retain a higher share of your passenger base and demand carried when a new entrant enters a city pair you fly on, even with a lower fare.
Let's say right now you have a city pair where you carry all passengers. Right now, if someone else comes in and undercuts your fare, you lose nearly all of those passengers to the other carrier. Under this hypothetical scenario, let's say even if the other carrier offers a lower fare, you could retain 15, 30, 45 percent of those passengers you had previously carried based on the quality of your frequent flier program and the customer loyalty it built.
In the real world, when Frontier entered the DCA-DEN market with low fares, it did not mean United flights started to go empty. United has a base of frequent fliers who stick to them.
This is important because it adds a new element that provides an alternative to "constant expansion" as the way to retain a good position in the game.
What do you think?