The topic in which I chose to do a scrapbook on was “How the government affects the airline industry in Canada”. Specifically I chose articles that related to the aftermaths of the September 11th tragedy. This event affected airlines in an enormous manner. Many airlines were facing economical problems and in turned asked the government for assistance. As a result, Canada 3000, which was Canada’s second largest airline carrier filed for bankruptcy protection on October 11th. Air Canada was also faced with many hard to make decisions. They turned to the Canadian government and asked for financial assistance. The Problem Solving Method will be examined to determine how the government came to the decision of actually granting Air Canada some assistance. Problem Solving Method 1. Decide on the "Issue" (Define it carefully to avoid arguments later.) The issue that is being discussed in whether or not the government should help Air Canada out financially. As can be seen in the articles presented in the scrapbook, it is known that the government controls many of the operations at Air Canada. 2. Examine various points of view and the opinions they have. · Your own In my opinion, I think that the Canadian government should help Air Canada with financial assistance. I believe that if the government wants to have control over their fare prices, whether or not they can open a discount airline, and the amount of workers they are able to hire, that they have an obligation to the airline to help them out in these types of situations. · Those of key groups or individuals (stakeholders) a) Air Canada Union Representatives – This group feels that the government should be active in financial aid relief. During the events after September 11th, the union stated in many national papers, that they felt that they deserved the same amount of support and relief that the US government was giving their airlines. b) The Canadian Government – The government had essentially three choices: i) They could help the airline. ii) They could do nothing and let the airline claim bankruptcy. iii) They could buy back into Air Canada. With the first choice, the government has to allocate some of their resources to the airline. The second option was not feasible for the government to partake in because of the fact that Canadian citizens would be loosing the biggest airline carrier. The third option, which the government did consider, involved two options. The government could either buy a minority of the shares or they could buy the entire operation and that would result in Air Canada becoming a crown corporation.
"The 'Open Skies Agreement' between governments of US and Canada in March 2007 came into action as it liberalized the air transportation services. Cargo and passenger services as well greater flexibility in the operations developed" (Air Canada Annual Information Forum, 2011-2012).
...ther through income tax or GST, as they are all ultimate benefactors of socially optimal policy. Thus, the tax would be reinvested in benefiting Canadians.
The immediate financial repercussions of the terrorist attacks were astronomical. Makinen (2002) reports airlines received a $15 billion federal aid package. Additionally, insurance ...
In 1978, deregulation removed government control over fares and domestic routes. A slew of new entrants entered the market, but within 10 years, all but one airline (America West), had failed and ceased to exist. With long-term growth estimates of 4 percent for air travel, it's attractive for new firms to service the demand. It was as simple as having enough capital to lease a plane and passengers willing to pay for a seat on the plane. In recent news, the story about an 18-yr British...
When examining the major impact of an airline, one should take into account the airline’s history. Air North -the Yukon’s airline has been around for 36 years and dates back to the 1970’s. Air North is a regional based carrier that provides service within the Yukon (the westernmost and smallest of Canada’s three federal territories) between the Yukon and British Columbia, Alberta, Northwest Territories and Alaska (Fly Air North, 2013). These services also include scheduled passenger service, charter services for passenger and/or cargo and cargo and ground handling services (Fly Air North, 2013). The charter passenger service is provided throughout Canada and the United States. The Yukon’s airline is headquartered in Whitehorse, Yukon. It is the largest airline in the Yukon and is one of only five Canadian carriers that provide a year round scheduled domestic air service with jet equipment (Fly Air North, 2013). The airline also has over two hundred full-time and part-time employees in the Yukon and also operates a base in Vancouver, which employs over sixty people. Air North is one of the largest private sector employers in the Yukon (Fly Air North, 2013). Interestingly enough, is that one of fifteen Yukoners hold an equity or employment stake in Air North, Yukon’s Airline (Fly Air North, 2013).
"Problems" in the airline industry have not risen due to too much competition within the industry. To the contrary, Washington regulators should turn the industry loose in any more ways that it can. Lowering restrictions to enter the market place, emphasizing private ownership of aviation matters, and encouraging open and free competition within the scope of anti-trust law should be the goals of the Clinton Administration. Instead of heading towards re-regulation, Washington should get out of the airline business for good.
International and domestic aviation industries exhibit large changes in political environments, affecting mannerisms of customer travel (asse.org, 2017). Aviation bodies, including International Air Transport Association (IATA , 2017), regulating international air transport, and Civil Aviation Authority (CASA, 2017), regulating Australian air services, have authority in ensuring execution of the correct practices and procedures. The Australian Competition & Consumer Commission (ACCC, 2017), ensures government regulations, trade agreements, and taxation laws are executed. International political trade relationships, affect passenger numbers travelling between countries, and political instability affects Qantas revenues (Kaivanto & Zhang, 2017).
Albers, S. B. (2009, March 13). crisis of Qantas. Retrieved May 14, 2014, from Qantas crisis: http://wenku.baidu.com/view/31572f48cf84b9d528ea7a56
Global competition- As more companies are coming into this airline market so there can be a threat to Air Canada from these
Economics plays a huge role in the airline industry. For Southwest, the CEO states that they kicked off a “low fare revolution” back forty-five years ago when the company began. It was their goal to make flying affordable and convenient for the average man; flying was no longer going to be just for the elite. According to CEO Gary Kelly when Southwest Airline originated “only 15 percent of Americans had traveled by plane” (The Low-Fare Revolution). That number has currently risen to more than 85 percent of the United States population, with a large part of the credit going to Southwest Airline. All of this being said, one author notes that since
The airline industry has an incredibly intricate market ruled by consumer need and firm greed. The airline industry utilizes an oligopoly style market structure and airlines often use certain price discriminations to obtain the most revenue from their services. Externalities also weigh into the airline industry. Competition amongst airlines is incredibly fierce and only those who are thirsty for business and cold hard cash will survive within the terminal walls and jetway halls.
The Human Resource topic that we selected is to analyze the benefit programs of four major airlines. Benefits are important to employees as well as their families, and can be a powerful recruiting tool. Benefits also play a major role in managerial decisions and wise benefit choices can have a long-term impact on the quality of life. Some characteristics of a sound benefits program are, they must have clear specific objectives, they must allow for employee input, they must be responsive to societal and environmental change, provide for flexibility, and there must be clear communication with employees. One of the main challenges that companies face are the overall costs of these benefit programs to the companies themselves, as well as staying competitive in hopes to attract high quality employees. Almost 40% or $14,678 per employee is spent on benefit programs per year.
Another key tenet of Southwest Airlines success involves positive labor relations. From the aforementioned esprit de corps and fostering an atmosphere of fun to the no lay off policy, even during times of recession, Southwest Airlines enjoyed above industry average cooperation from labor unions. Kelleher stepped down, as CEO, in August 2001, coincidentally the airline experienced its’ most serious labor disputes from 2002 to 2004 with the mechanic union and flight attendants respectively. Uncle Herb returned to resolve the latter dispute in 2004 and appointed Gary C. Kelly as
This will lead to the limitations on the number of routes the international carriers fly, flight schedules, fares, etc. The past five years witnessed an increase in the cost of fuel, leading many airlines into bankruptcies, which resulted in consequences such as the $30 billion loss faced by the US airline industry as estimated by the US Airport Transport Association. One of the major political factor of globalization that affected airline industry was 9/11. In order to deter future terrorist threats, several security rules and regulations were enforced, which led to the increased cost of aviation operators to administer the fundamental training and personnel to follow these rules. Additionally, the post 9/11 period saw a decline in passenger and consumer requirements, negatively affecting the airline profits. There was a revenue drop of dollar 22 billion and three years were taken to recover them. But these revenues were dropped by 14% during the global financial crisis during the years 2008 and 2009, which was reclaimed to a large extend in the following year. The 9/11 period brought forward a huge global impact such as decline in traffic, revenues and profitability, increase in oil price and bankruptcies,