Air Transat analysis

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Air Transat

Introduction:

Air Transat is a Canadian airline based in Montreal, Quebec. It was founded in 1987, and is owned by Transat A.T. Inc. According to Air Transat’s website, their mission statement is:

“Air Transat is Canada’s leading holiday travel airline. Every year, it carries some 3 million passengers to nearly 60 destinations in 25 countries aboard its fleet of Airbus wide-body jets. The company employs approximately 2,000 people. Air Transat is a business unit of Transat A.T. Inc., an integrated international tour operator with more than 60 destination countries and that distributes products in over 50 countries. Air Transat was named World’s Best Leisure Airline at the Skytrax annual World Airline Awards, held in
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New European union regulations have led to higher levels of competition on European routes.

Increase in the price of oil
Increase in transportation costs
Increase in disposable income due to rise in incomes and lower interest rates (people have more money to spend on leisure trips)
Change in consumer behavior resulting from the aging population in Canada may affect the number of leisure trips taken
Increased popularity in travelling abroad
- Carbon dioxide emission
- Emirates airlines launching double decker aircrafts (A380), serving 25 destinations
- Wireless internet being launched in aircrafts
- Frequent flyer programs

The increase in the price of oil and the rate at which it is increasing is a global issue. For Air Transat, this means an increase in cost and expenditure. Since oil is essential in this industry, there is not much that Air Transat can do. The increase in the price of oil could cause force Air Transat to increase their prices
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