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Beginnig of air travel
History of air cargo industry
Beginnig of air travel
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Air transport is the conveyance of more recent development, and therefore the most modern. This implies the presence of very advanced technological conditions, standardized procedures developed computer worldwide. Rates, flights and destinations are included in international publications, which are available immediately via the Internet or with a simple call to airlines, travel agencies or freight forwarders. Despite these facilities, high costs in the operation, turn the air transport management in a very sensitive within the logistics system where one mistake can mean significant economic consequences appearance. Air transport, its high cost and capacity constraints, is appropriate for covering routes between middle and long distance and charge for shipping small, perishable goods, high value and urgent deliveries. Factors affecting demand for air traffic costs the airlines and therefore passenger fares and freight are included. In recent years the costs of airlines have been adversely affected due to increased insurance costs, in addition to the oil price hikes. Moreover changes i...
Typical users of airfreight were producers of time-sensitive, high priced, finished goods such as valuable architecture and confidential documents. But in 1976, a spring survey shows that only 24% customers used both Courier Pak and Priority One services while less than 1% of them used only Courier Pak. Moreover, the cap...
The airline industry has long attempted to segment the air travel market in order to effectively target its constituents. The classic airline model consists of First Class, Business Class and Economy, and the demographics that make up the classes have both similarities and differences to the other classes. For instance there may be similarities between business class travellers on a particular flight, but they will not all be travelling for the same reason. An almost-universal characteristic of air travel is that customers do not fly for the sake of flying; the destination is the important element and the travel is a by-product, a means-to-an-end that involves the necessity of an aircraft that gets the customer from point A to point B. Because the reasons can differ greatly in the motivations for a customer wanting to fly, it can be difficult to divide the market into discrete segments, that is, there is always going to be overlap in the preferences and characteristics of any given segment. With that in mind, the commonalities that are shared between the clientele that make up the respective classes can easily withstand analysis.
Air travel began in the early 1900s and scheduled flights started in the 1920s (Harris). In the early years, the airline industry competition was nonexistent. The competitive environment changed dramatically over the course of the last century specifically when the industry underwent regulation and then deregulation. The future success of the airline industry depends on the ability to adapt with rapidly changing industry environmental factors.
Lufthansa, one of the world’s biggest airliners, has divisions handing maintenance, catering and air cargo. Since the World War II the airline industry has never earned its cost of capital over the business cycle (Hitt, 2010). Most of the airline companies have either filed for bankruptcy or are being bailed out by their government. Lufthansa had also gone through these tough times, but had resurfaced to become one of the worlds most profitable airline company. The company adapted a transnational strategy, seeking to achieve both global efficiency and local responsiveness. Lufthansa’s monopoly in Germany came to a halt with the creating of the European Union. All the EU member countries become one regional and therefore the European competition became, an increasingly a local competition. Lufthansa created its regional Hubs, to cater for its domestic market. But the availability of substitutes such as bullet trains and the Euro tunnel, made is necessary for Lufthansa to create short traveling time, customizations and quality standards in the region to achieve a competitive advantage. But outside the EU there are no substitute to air travels as such all the flag carriers are competing in the market, the international airline industry is a highly competitive environment. A new force has also emerged in the world of air travel, in the form of three Gulf airlines with jumbo ambitions. Within a decade Dubai’s Emirates, Qatar Airways and Eithad from Abu Dhabi have between them carried the capacity of two hundred million passengers (Micheal, 2010). The company had to go global and therefore adopted the international corporate-level strategy, where Lufthansa will ope...
The main threats to the industry over the next five years are the rise in price of oil, legislation, the TSA, and labor costs. Each of these threats effect the scheduled air transportation industry not only endangers Delta Airlines but the entire industry. As the price of labor increases for ground operations and pilots this creates a burden on the industry by causing them to spend more to satisfy their labor requirements. The price of fuel increasing leads to the price of fuel to increase, which not only affects a single airline but every airline. With each time that the crude oil price rises the prices associated with the costs of refining the jet fuel as well as transporting it. These costs are distributed to each airline as they use this resource to transport passengers. As new politicians are elected to Congress and new administrators take charge of the FAA new regulations regarding this industry. These regulations affect everything from mergers to the airspace that the airlines operate in as well as what hubs and airports each airline operates out of. These factors are not issues that the industry faces, the TSA, the Transportation Security Administration, creates an unnecessary burden for the passengers attempting to travel from one location to another. The TSA inspections required before a passenger is allowed to board their respective flights allows time for each passenger to become frustrated with the amount of time they have to allot for inspection as well as the invasion of their privacy.
In the past two decades, transportation cost of cargo has decreased that has aided in improving productivity and economic growth. Nonetheless, the operations of the market forces and the rising cost of fuel as well as environmental concerns impact on the cost of transporting goods from one place to another. Subsequently, the high cost of moving goods will be felt throughout the economy affecting enter...
Aviation has a huge environmental impact to the environment and society, the aircraft engines releases a noise that affects human life and the particulates and gases that are released from the aircraft engines contribute to climate change and increases the global warming. Despite the emission reductions from cars and more fuel-efficient and less polluting turbofan and turboprop engines, the rapid growth of air transportation in the recent years contributes to an increase in total pollution attributable to aviation. In the European Union, and increased greenhouse gas emissions from aviation increased by 87% between 1990 and 2006. Like any other form of public mass transportation that relies on resources that are extracted from the planet for e.g. Oil, and the airline cannot be considered sustainable in the long-term too. Because of the limited resources in which the Aviation relies on, it is more realistic to think how to improve the sustainability of the air transportation rather than achieving a sustainable development. Demand for air transport is growing constantly and, if this demand is to be met with all the benefits associated, the community or society must also accept the costs like; (Pollution, Aircraft noise, Environment change, risk, and resources consumption, etc.).
Flight fee is one of the biggest nightmares of the passenger. In this regard, such an initiative is a win-win situation for the Asiana airlines. The establishment of extensive cabin retrofits is also a great improvement to the customer service delivery. The airline also boosts customer experience in a bid to achieve the airline’s sustainability through the provision of lie-flat seats. The seats boost comfort for the passengers aboard; hence, reduction of exhaustion. According to Asian Development Bank (2009), the airline provides the passengers with a sizeable monitor, especially for the business class passengers. The practical productivity of team relies on upon its hypothetical planning, information of an aeronautical building, and tenets of its operation, including exceptional circumstances, and propensities for utilization of this learning, furthermore on order and determination of pilot-in-charge of aircraft and group individuals. The administration productivity air movement, the associations of flight action and a wide range of upkeep of aircraft in the greatest degree is controlled by the proficiency of the action association in the modern undertakings, cognizance of initiators, and the moral obligation of leaders of all positions for action concerning security control of
Air travel has grown in the past decade. Travel grew strongly for both leisure and business purposes. India will have nearly 800 to 1000 airplanes by 2023, it was estimated by Airbus. In spite of growth between 30 to 50 per cent in Indian aviation industry, losses of approximately 2200 crore is estimated for the current year.
The airline industry is very susceptible to changes in the political environment as it has a great bearing on the travel habits of its customers. An unstable political environment causes uncertainty in the minds of the air travellers, regarding travelling to a particular country.
One of the characteristics of service offered by AirAsia is intangibility. Services intangibility is inevitable and sometimes could be a challenge for every service provider. According to Pride & Ferrell (2011) intangibility of services can be defined as the characteristic that the service is not physical and cannot be perceived by the senses. For instance like AirAsia which provides flight services, it is impossible for the customers to touch the flight as it is a journey to specific destinations. They might be able to touch the plane, but in the context of services, the customers do not own the physical tools or equipment used to deliver the service but are only entitled to get the service which is the flight service.
Airline industry is affected by no. of factors such as fuel price fluctuations, high fixed costs, strong influence of external environment and excessive use of marginal costing by carriers. Recessions in the industry tend to last longer, while recovery periods are generally shorter. Over the past nine years, it is observed that industry has made losses for five years and during the profitable years margins were on a lower end. The airlines industry is acutely sensitive to external events such as wars, economic instability, government policies and environmental regulations.
In logistic industry, they have been through lots of challenge in worldwide market. As the containerization of the global economy scopes, a phase of development and explanation, ports find themselves inserted in ever changing commercial environment where logistics is the forefront. Thus, this industry reaches a phase of maturity and rationalization due to the process of logistic on land.
“Logistic is the process of planning, implementing and controlling the efficient, effective flow of goods storage of goods, services and related information from the point of origin to the point of consumption for the purpose of conforming to customer requirements”
For the freight, I separate into a domestic shipping and international shipping. A domestic freight shipment, the rail transportation will take place or have a higher market share than air transport because the rail network will be congested, easier to access especially in the centre of the country furthermore costs is much more lower compared with a large capacity of its. But for international freight shipment, 90 percentage of air cargo belongs to air transport, it can beat against rail transport because of the geography to clarify, mountain or river that hard to build a railway and connect to neighbor countries likes Myanmar (Burma), and the time savings of air transport is on demand mostly for just-in-time businesses. Anyway, it also depend on the type of its product, a product which is fragile, perishable and high-value is more suitable for air transport but rail transport will compete for agricultural products which is perishable by a cold storage rail that a cost reduction and it usually ships an industrial product. Not only competing with rail transport but also contend with Singapore Changi Airport, the top busiest AEC's busiest airports by cargo traffic. Next the passenger, I also divide into two parts, first in a centre of Thailand and less than 300 kilometres from Bangkok, second is the remote area where is more than 300 kilometres far from the capital. In a short distance (less than 300 kilometres from Bangkok) and the centre part of a country where the rail transport is the better choice to be in services because railway network is very dispersed than any parts, many stations, lower fare and time saving in operation likes transit or boarding period, moreover the government promotes a rail transport to be a centre of tourism in a region. In the