Economics of Commercial Aviation

Paper Summary:

In this article, the writer discusses that with rising fuel prices and terrorism as a backdrop, many of the world's major commercial airlines have filed bankruptcy, blaming the additional costs of fuel and security measures for their demise. The writer notes however, that this is not the case with every airline, which leads to interesting subject matter to validate an issue position. In this paper, the researcher validates the issue position that the economic collapse of many major airlines has not been caused by fuel and security, but rather by flaws in the typical commercial aviation business model. This position is justified by the citation of relevant literature and logical conclusions drawn from the research of same. The writer concludes that the aviation industry needs to continually strive for excellence if it is to avoid its own self-fulfilling prophecy.

Outline:
Presentation of Position
Commercial Aviation Still Holds Potential for Success
Modern Success Stories Exist
Current Events in Commercial Aviation
Bankruptcies are commonplace
Bankruptcies are Caused by Several Common Factors
Success Stories in Commercial Aviation
India's Aviation Renaissance
Low Cost Aviation Model
Proof of Position
Closing Thoughts

From the Paper:

"The commercial aviation industry is chock full of an inordinate number of bankruptcies, with hundreds occurring over the past several decades. These events had been blamed on a wide variety of factors over the years. Over the last 6 months, there has been another rash of bankruptcies, which are currently being blamed on the excess costs of the security measures needed to protect commercial flights from terrorist infiltration and the rising cost of fuel, with sources reporting that the industry can only realistically pass 10% of the additional expenses on to the consumer for a variety of reasons."

Sample of Sources Used:

• Airline Business Online. (2005, April 29). The Right Cost Airline. Retrieved April 12, 2006, from Crew Database Online Web Site: http://www.crewdatabase.com/Articles/item143.
• Business Day Magazine (2005, December 6). Asian Air Travel Hits Turbulence. Business Day online. Retrieved April 12, 2006, from Business Day Online Web Site: http://www.businessday.co.za/articles/travel.aspx?ID=BD4A123721.
• Mutzabaugh, B. (2005, December 31). Striking NWA Workers Vote Down Latest Proposal. USA Today. Retrieved April 12, 2006 from http://www/usatoday.com/sky/2005.
• Thomas, G. (2005, April). India by the Numbers. Air Transport World Magazine, 5, 34.

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