Airlines

Airlines

Brief Excerpt from Industry Overview Chapter:

Companies in this industry provide scheduled domestic and international passenger transportation, as well as mail and freight transportation. Major US companies include American Airlines, Delta, FedEx, Southwest, and United Airlines; leading companies based outside the US include AIR FRANCE KLM MARTINAIR Cargo, China Southern Airlines (China), Emirates Group (Dubai), International Airlines Group (the UK), and Lufthansa Group (Germany).

COMPETITIVE LANDSCAPE

Airline demand depends highly on the health of the economy, which affects spending on business and leisure air travel. Because many costs are fixed, the profitability of individual companies is determined by efficient operations and on favorable fuel and labor costs. Large companies enjoy economies of scale in purchasing and the ability to provide more extensive services. Small airlines can compete by serving local or regional routes.

PRODUCTS, OPERATIONS & TECHNOLOGY

Major services include domestic passenger (about 70%) and international passenger transportation (about 10%); mail and freight transportation accounts for most of the remainder. Other revenue (about 20%) comes from providing maintenance, servicing, training, and reservations. Some airlines also offer nonscheduled (charter) flights. Some airlines carry only cargo, using specially equipped planes. Most passenger airlines also provide cargo services.