Macroeconomics (Airline Industry)

Topics: Airline, Low-cost carrier, Southwest Airlines Pages: 2 (476 words) Published: June 22, 2013
MACRO PERSPECTIVE ( AIRLINE INDUSTRY)
Economical can be one of the major factors for the airline industry. Due to the rate of war and terrorist event, the growth rate of economy dramatic slowdown, capacity demand, which gains the low yield to the airline industry. Moreover, oil prices increase also affect their profits. The social sector, which are strongly from employment perspective and safety.

The technology in airline industry is fast moving, however it’s very costly. Alliance gives the opportunity to the major airline to offer customer global route coverage. Ecological factor consists of recycling, the level of pollution and attitudes to the environment. For the airline industry, pollution tends to be very important.

Legislation fior the airline consist of employment laws, company law, tax law and their regulation. Redundancy, landing right, health and safety, which are all the airlines, should be considered as a legal factor.

Airline industry recovered and it become more attractive for investor. Economical and political factor has always been and continues to be the two major external environmental drivers influencing the airline industry.

MICRO PERSPECTIVE (BUDGET AIRLINE)

A low cost carrier (also known as a no-frills or discount carrier) is an airline that offers generally low fares in exchange for eliminating many traditional passenger services. The model represented by the (LCC) or low cost carrier is not an innovation, some of the LCC are linked to major and traditional airlines companies, but its evolution has quickly become the dominant management model and through the development of the Internet has experienced the most growth.

Though many airlines offer fares at a reduced rate on one or more of their routes at particular times, the simple act of offering cheap fares does not necessarily make them a LCC. Low cost carrier with the specific aim of operating with a lower cost structure than traditional operators in order to...
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