Airline Industry Research
Essay by kennethxia • April 7, 2013 • Case Study • 684 Words (3 Pages) • 1,705 Views
Airline industry research
Airplane is one of few inventions that have changed people's live, experience and the world hugely. Air travel has become one of parts of our daily life and it would be hard to imagine our life without it. Airline industry makes it possible for people to travel and operate business in places once considered distance since the travel time has been significantly shortened. However, the airline industry has developed which altering people's concept of distance. Through scheduled and chartered, the airline industry ensure passenger air transportation. Marketline(2003) concluded that the total revenue obtained by airline industry is defined as its industry value through transporting these passengers.
Over last couple of years, the global airlines industry showed healthy growth and it is expected to continue the growth with a high grow rates in the coming years up to 2016. In 2011, the global airlines industry had total revenues of 570.1 billion dollars. In the global airlines industry, the industry volumes increased with a compound annual growth rate of 2.6% between 2007 and 2011. With an anticipated compound annual growth rate of 13.9% within 2011 and 2016,the performance of the airline industry is forecast to accelerate (Marketline 2003).
The European airline plan a dominate role in the airline industry. British Airways reported annual revenues of GBP8,593 million in 2008. Lufthansa reported annual revenues of Euro22.4 billion in 2007. The other major passenger airlines include Cathay Pacific, US Airways, Japan Airlines, Air France-KLM etc. Cathay Pacific won the 2009 Airline of the Year title in the famous World Airline Awards, replacing Singapore Airlines as the 'world's best airline.' Among the freight carriers, FedEx is the world's largest, with total revenues of US$ 37.953 billion in 2008 (Economy Watch 2010). Papatheodorou(2006) conclude that it is a global reality that in order to maintain and exceed the expectations of schedules, services and the concomitant need of operations performance, the airline industry always under a high pressure. Market line(2003) noted some leading companies in the global airline industry like Air France-Klm which is combined with two airlines which include KLM and Air France. British Airways, which is a full service global airline company and serves more 400 destinations worldwide.
There was an interesting examples showed by Michael (2008), although the airline industry has high entry barriers, in the late 1990s, there are some new firms entered the industry. Among them like Air Tran Airways and Jet Blue created certain competitive challenges for some major airlines. To the most important, they found a right position in this industry. Both of these two firms compete in the low-cost segments. With the increasingly demands of consumers, the major high-cost legacy airlines became less competitive.
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