Publisher's Synopsis
Chapter EightAirline cost control strategyHow positive or negative social change can influence any airlines' air ticket prices to be risen or fallen.We are entering globalization. In Special, airline transportation demands are also increasing, due to many travelers need to catch planes to travel as well as many cargoes need to be carried to planes to transport to different countries to sell. It seems aviation transportation industry is important to influence the health of the global economy growth nowadays. However, ignorance of internal or external market dynamics, catching travelers business can be detrimental to airline profitability more than carrying cargoes business. Because the demands of travelling different countries' travelers' consumption are still more than the demands of businessmen carrying cargoes in any countries every year. So, the global GDP of travelling income sector is still have the important position to any country nowadays.How can positive or negative social change influence any airlines' air ticket prices to be risen or fallen? In fact, the increase in petroleum price can have chance to affect airlines in a negative manner because increased oil prices have resulted in the reduction of services operations, the number of airline schedules flights, even airline bankruptcies. Whether inflation, terrorism, oil price, bank interest rate etc. external factors which factor has the most influential to cause the bad effects to cause airline industry share price reducing or reducing air ticket price or decreasing traveler numbers. To support this hypotheses, this are my research questions, such as: Does a combination of terrorism and price of petroleum significantly influence airline profit changing mostly? The alternative hypothesis was whether a significant relationship exists between terrorism, price of petroleum and airline profitability more than other factors, such as inflation, bank interest rate or air ticket price changing of these factors influence. I shall indicate that the first assumption was that terrorism has a negative effect on airline profitability and another assumption was that only external factors as oil prices or terrorism affect airline profitability. -What is the relationship of oil price and terrorism to airline industry?However the effects of oil price and terrorism on airline profitability was limited to a regional perspective, e.g. the terrorism attack of plane crash event to USA on 11 Sept. After the terrorism attack happened on USA 11 Sept. incident of terrorism attack was restricted to events of skyjacking, attacks on oil production, refinery and distribution. Other types of terrorist activities, such as attacks on financial targets or senior government officials could have an adverse effect on the petroleum and airline industry. I think the disruption of the production or distribution of petroleum because of incidents of terrorism was costly in terms of loss of business and the inflationary effect on fuel dependent products or services. In fact, some airlines have adopted more fuel saving technology, so whose fuel consumption would not use more than other non fuel saving technology airlines. It seems fuel price increasing will not be the only factor to influence the airline industry's traveler numbers decreasing. However, due to some airlines which have fuel saving technology, so which can avoid to use more fuel to provide planes to use and which fuel costs will be reduced, then which can provide cheaper air ticket fare prices to compare the non fuel saving technology airlines. The result will cause some airlines will lose travelling customers in this global airline travelling market, also the non fuel saving technology airlines need to renew their fuel technology if which want to keep their competitive abilities to avoid to close down their businesses.
