Airline industry problems and prospects

Presentation Outline -The elements of the jig-saw puzzle -Trends in financial results -Industry charcateristics and problems -Major constraints -Trends in load factors -Financing? -Traffic growth prospects -Productivity is the key -The environmental challenge -Summary of main points

Impact of deregulation

Pre-Deregulation in the US - Carriers were not able to compete in terms of price - Service quality and frequency were the main means by which they competed - Load factors were low and unit costs high as a result - A study by Jordan (Airline Regulation in America, 1970) of inter-state trunk airline fares in 1965 showed that if there had been no regulation these would have been 32 –47% lower