International Air Transporation: Some Challenges

In a Spring 1984 article in the FIU Hospitality Review, new developments in the domestic airline industry were discussed, particularly those relating to the forces of deregulation and the changes brought about by this phenomenon. This article takes a wider perspective in examining the global air transportation scene, the changes that have been wrought recently on air carriers flying international routes, and the carriers' responses to these changes.

Deregulation and the Marketing of Airline Carriers

No student of the hospitality industry can long be insensitive to the role of air transportation in creating much, though by no means all, of the "place demand" for his industry. This article confines itself to a discussion of the impact of deregulation on carriers in the industry and discusses implications for the hospitality field

The paradox of competition for airline passengers with reduced mobility (PRM)

Airline competition with customer service as product differentiator has forced down costs, air fares and investor returns. Two passenger markets operate in aviation: (a) able-bodied passengers for whom airlines compete and (b) passengers with reduced mobility (PRMs) – disabled by age, obesity or medical problems – for whom airlines do not compete. Government interference in the market intended to protect a minority of narrowly-defined PRMs has had unintended consequences of enabling increasing numbers of more widely-defined PRMs to access complimentary airline provisions. With growing ageing and overweight populations and long-haul travelling medical tourists such regulation could lead to even lower investors’ returns. The International Air Transport Association (IATA) (2013) examined the air transport value chain for competitiveness using Porter’s (2008) five forces but did not distinguish between able-bodied passengers and PRMs. Findings during an investigation of these two markets concurred with IATA-Porter that the markets for the bargaining powers of PRM buyers and PRM suppliers were highly competitive. However, in contrast to the IATA conclusions, intensity of competition, and threats from new entrants and substitute products for PRM travel were low. The conclusion is that airlines are strategically PRM defensive by omission. Paradoxically, the airline which delivers the best PRM customer service could become the least profitable.

The paradox of competition for airline passengers with reduced mobility (PRM)

Airline competition with customer service as product differentiator has forced down costs, air fares and investor returns. Two passenger markets operate in aviation: (1) able-bodied passengers for whom airlines openly compete and (2) passengers with reduced mobility (PRMs) – disabled by age, obesity or medical problems – for whom airlines do not compete. Government interference in the market intended to protect a minority of narrowly-defined PRMs has had unintended consequences of enabling increasing numbers of more widely-defined PRMs to access complimentary airline provisions. With growing ageing and overweight populations and long-haul travelling medical tourists such regulation could lead to even lower investors’ returns. The International Air Transport Association (IATA) (2013) examined the air transport value chain for competitiveness using Porter’s (2008) five forces but did not distinguish between able-bodied passengers and PRMs. Findings during an investigation of these two markets concurred with IATA-Porter that the markets for the bargaining powers of PRM customers and PRM suppliers were ‘highly competitive’. However, in contrast to the IATA conclusions the threats posed by new entrants, substitute products and intensity of competition for PRM passengers were all ‘low’. The conclusion is that airlines are strategically PRM defensive by omission. Paradoxically, the airline which delivers the best PRM customer service could become the least profitable.

La estrategia en la perdurabilidad empresarial. Un estudio de la segunda aerolínea más antigua del mundo: Avianca

Una de las principales dificultades que se presenta en Colombia, para el desarrollo económico y social, está dada por la falta de sostenibilidad de la gran mayoría de empresas en el país. Por este motivo, este trabajo se ha concentrado en investigar este problema y brindar herramientas que ayuden a fomentar una cultura de perdurabilidad. Con este fin, se ha realizado un estudio acerca de Avianca, una empresa referente en el país en lo que respecta a la perdurabilidad, posicionamiento y estrategia, pues, a lo largo de sus casi cien años de historia, ha superado retos y circunstancias, que, de haber actuado de otra manera, habrían podido llevarla a su fin.