External Environment Analysis of Airline Industry

Topics: Inflation, Airline, Avianca Pages: 4 (860 words) Published: July 23, 2011
Elders aged 50 and above tend to have more time to travel around with their friends as they had already retired. The time is more flexible comparing with young generation-working groups and students. Working groups and students can only travel during holidays. 2.Education

When the people are more educated; they have the ability to get more income. Therefore, they will be more affordable to travel. 3.Occupation
Employees who work in multinational company often travel to other countries for the business purpose could be the important customer in airline industry. 4.Population
Highly populated country tends to utilize airline services more frequently. For instance, China has a larger market for travelling comparing with small country, such as Vietnam, Singapore and etc. 5.Gender

Women are more influential power in planning a vacation trip within a family. Economic
1.Bilateral trade
Bilateral trade increases the frequency of travelling by businessmen around the world. For example, when the two countries had successfully negotiated a bilateral trade agreement, it will also indirectly increase the airline industry business as businessmen or businesswomen have to travel frequently. 2.Inflation rate

The tendency of people travelling will be low when there are high inflation rate in the country. The airline ticket price increased due to inflation will reflect the consumer purchasing power of the airline ticket. 3.Power of currency

High currency value of a country indicates that the citizens have a higher purchasing power. Thus, the citizens intend to travel more when the currency of their country is high. They can exchange more foreign currency and they have a higher purchasing power. 4.Interest rate

High interest rate in a country encourages people to save money in the bank to gain a high interest return. People will travel less when the interest rate is high; inversely, people will travel more when the interest rate is low. 5....
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