Dr. Paul Browne
The Airline Industry
The study of the airline Industry can be divided into two time periods, the regulated industry period and the deregulated period. Under the regulated environment, the airline industry was under many rules and regulations that guided its operations. It was under the control of the Civil Aeronautics Board (CAB), which controlled the entry, exit and pricing of the airline services. Beside this the Board also controlled the “intercarrier agreements, mergers and consumer issues” (Smith & Cox, 2008).
The Airline Deregulation Act was passed in on October 24, 1978 with the main purpose to remove government control over fares, routes and market entry (Wikipedia, 2010). The result of the deregulation was reduced airfares; the airlines reconfigured their routes and equipment which improved the capacity regulation which made the air travel more accessible to the general public. In the present air travel scene there is a competitive price market. The pricing model was complex in the early deregulated period but later on the airline companies have simpler price structures.
Competitive issues in Airline Industry and Southwest Airline: Porter’s Five Forces Model Analysis
“Our people are our single greatest strength and most enduring long-term competitive advantage” this is the strength expressed by Southwest Airline. The statement conveys out that company strives to maintain the competitive edge in the industry (Kelly, 2006). There is very intensive competition in the Airline Industry market. In the analysis of competition issues in any industry, there should be considered one more factor that is the impact of international and national economic conditions on the market. The Airlines Industry is one of the most affected industries due to the economic recession. Airlines suffered... [continues]
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(2011, 03). Southwest Airlines. StudyMode.com. Retrieved 03, 2011, from http://www.studymode.com/essays/Southwest-Airlines-609124.html
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"Southwest Airlines." StudyMode.com. 03, 2011. Accessed 03, 2011. http://www.studymode.com/essays/Southwest-Airlines-609124.html.