Do Direct International Flights Represent A Regional Development Opportunity? A Global Economy?

1) Introduction to airline industry 2) Drivers of globalisation using yip’s model 2.1 Market globalisation 2.2 Cost globalisation 2.3 Globalisation of government policies 2.4 Globalisation of competition 3) Localisation- arguments against globalisation 4) Pestle Analysis 5) Porter’s 5 forces analysis and their application to Airline industry 5.1 Rivalry amongst Existing Firms 5.2 Threat of substitution 5.3 Threat of new entrants 5.4 Power of customers 5.5 Power of buyers 6) Opportunities and Threats of Airline industry 7) Internal analysis of Virgin Airlines: Strengths and Weakness 8) Financial Statics of Virgin Atlantic Airline 9) Strategic

The Airline industry is a large and constantly growing industry. It facilitates economic growth, international investment and world trade and is therefore central to other industries as well for globalisation. There are various forces which lead to globalisation in airline industry. Key drivers of change are forces likely to affect the structure of an industry; sector or market. (1).

According to Moosa (2002), “Hymer (1976) organized the industrial organization hypothesis. Kindleberger (1969), Caves (1982) and Dunning (1988) further explained the hypothesis. This theory assumes that the firms when it establishes an enterprizes in another country it suffers from many disadvantages in comparison to local investors. The cultural aspects, languages, legal system and other factors play an important role in determining FDI. But there is increase in FDI. The theory explains about why firms invest in foreign countries. But the theory fails to explain the motivation for choosing the locations. This theory explains the expansion of FDI is due to capital, management, technology, marketing, and access to raw materials, economies of

World cities are connected to each other by a range of transport networks and services. They are also connected to other major cities and a variety of urban and rural centres at global, national, regional and local scales. Global centres function as frameworks of world growth and dominate the world technologically, financially and culturally engage in strategic decision making. World cities therefore exist at the top of this hierarchy of cities. A net transfer of funds exists between the worlds developed countries to the developing world. Information, goods and services, people and capital flow can be traced to analyse the operation of the global network of cities. A cities prominence in the global economy is a considerable factor but other social political and cultural aspects have also been acknowledged by geographers who recognise innovation, equity, wellbeing and liveability across all these spheres as an important aspect. There is considerable agreement, however that advanced economic growth and development on a global scale is a

The flow of capital, information, goods and services, and people are among the more readily measured indicators of such links between large cities. Generally, there has been a net transfer of funds from the worlds developed economies to countries in the developed world. The decision makers directing these flows are typically located in world cities, such as London, while these on whom the decision impacts are often found in the old industrial centres of the developed world, where the cash is being redirected form. This also has a major effect on those in the developing world, which is the areas to which capital is being directed. This resulted in factory closures and high unemployment in the old manufacturing centres of the developed world and factory openings and job creation in the low-cost economies of the developing world. There have been many attempts to compute the linkages between global cites such as London, one such attempt focuses on the concept connectivity. This is essentially a measure of the flows of information, knowledge, and direction between the international office networks of global services, these being the most basic agents of the formation of the world city network. Based on these criteria London's strongest links are with North American cities such as New York, Washington DC and Chicago, as well as some Asian cities such as Hong Kong, Singapore and Tokyo. The global hierarchy of cities is essentially a functional hierarchy ranging from 12 cities down to national regional and local scales, with London generally considered at the centre of the hierarchy, being the largest contributor to the global

American carriers, by 2010. As of this writing, the U.S. has not recipricated these air

Airports play a vital role in today’s age. They allow anyone to travel to any destination with ease and allow business to be carried out on a global scale. Aircraft operating in and out of airports can move businessmen and woman to destinations around the world so that they may carry out their business, as well as cargo operations. Local airports attract businesses to them which helps out local economies, and global economies when

The U.S. airline industry provides a unique service to its customers. It transports people and goods with efficiency and convenience which is not achieved by any other service. The purpose of this article is to collect data on the U.S. airline industry and analyze the state of the industry today. Data came from sources such as the Federal Aviation Administration, scholarly articles, and websites such as dallas.culturemap.com and airwise.com. Tools used to analyze the data include P.E.S.T., and Porter’s five forces. The analysis also focuses on the industries’ drivers of change and its key survival factors.

Qantas airlines are an iconic Australian business, which has heavily shaped the tourism industry. However in the 2013-14 financial year, (Qantas, 2014, pg.1) due to falls in revenue, growing competition and high expenses the airline reported a 2.8 billion dollar loss. (Mccrann, 2014) It was then that the company felt it required government support to assist them in getting back on their feet. Commonly referred to as a “bailout” and in this case more specifically a “debt guarantee”, this would involve the Australian Government covering Qantas’ debts, should the company collapse. (Mcllroy, 2014, p9) There were mixed views on this particular issue between different MP’s, different political parties and against Qantas itself. After much debate on the issue however it was declared that the Government would not grant a debt guarantee to Qantas. (Coorey, 2014) This essay takes into account both sides of this debate and explains why the ultimate decision by the Government not to financially support Qantas was justified.

Over the past few decades, technological advancements in both communication and transportation has led to an era of interconnectedness known as globalization. The emergence of air travel in the late 20th century led to an affordable and time efficient method of transportation. Due to this, air travel quickly arose as an essential factor in the world economy. Following the emergence of aviation, world economies became tied together and utterly dependent on each other. However, the very thing that fuels our globalization is also the very thing that fuels our destruction. Commercial aviation is one of the fastest growing sources of greenhouse gas emissions and yet a critical component of the global economic infrastructure. In the last 10 years the rate at which air travel has been increasing has grown at an astonishing rate. Today, the airline industry is responsible for a total of 4.9% of all human-caused climate impacts worldwide, including the emission of greenhouse gases such as CO2, O3, CH4, NOx, H2O vapor, contrails, SO4 and soot. The pace at which we see these adverse effects is very startling yet, business and life is so dependent on air travel. Air travel is essential for large scale institutions and businesses that are relevant on a global scale. The University of Maryland is a perfect example of an institution where air travel is a big portion of its annual carbon emission. Improving plane infrastructure, implementing fuel alternatives, and changing cultural habits

Literature reveals that the globalisation of the airline industry has resulted in easier accessibility across international borders. This has greatly benefited the tourism industries economic sector with a rise of foreign tourists and an increase in global competition (Dwyer, 2015). However the negative effects on the environment are vast with climate change has become a global problem. A swish study proved that out of the countries examined, 50-85% of tourism based emissions are as a result of air transport and therefore if the tourism industry is to reduce emissions, it can only be achieved through a major decrease in these environmentally destructive emissions caused by aviation (Perch-Nielsen et al, 2010).

Topics of this paper will include how Dubai’s aviation model has impacted the economies of both regional and international communities, and how the current infrastructure of Dubai’s logistics industry will affect the growth within the Dubai aviation model. Citing recent studies, this paper will explore how the Dubai aviation sector has contributed to its own region’s growth while threatening the status of past international aviation hubs such as Britain’s Heathrow airport. The ambition of Dubai’s ruling government will be discussed as a major factor in the growth of Dubai’s aviation model. Specifically, how Sheikh Ahmed bin Saeed Maktoum’s ambition and vision has helped “establish the emirate as an award-winning logistics hub” (Greenway, 2013, p 33). In spite of recent crisis in global economies, Dubai’s aviation sector has largely been responsible for restoring economic and

Aviation provides the sole worldwide transportation network that makes it essential for international business and tourism. It plays a significant role in facilitating economic growth, notably in developing countries. Flying transports close to two billion travelers per annum and four-hundredth of interregional fares of merchandise (by worth), four-hundredth of international tourists currently travel by air. The air transportation industry generates a total of twenty nine million jobs globally (through direct, indirect, induced and catalytic impacts). Aviation’s international economic impact (direct, indirect, induced and catalytic) is calculable at US$ 2,960 billion, comparable to 8 may 1945 of world Gross Domestic Product (GDP)

Turkey has a geopolitically important place in the world, a cross-road of continents like a bridge between Asia and Europe. Besides this, the country has one of the biggest populations of Europe with nearly 80 million inhabitants. Because of the country’s growing GDP a great potential of air travel emerging which was relatively underpenetrated by air travel when compared with the larger Western European countries. The figure below shows the relatively steady growth in GDP and number of domestic and international flights of Turkish market. The positive relation between GDP and number of flights can be derived from the graph.

Malaysia Airlines is a world-renowned flag carrier that commenced operation in 1972. The airline serves as a symbol of national pride after the formation of Malaysia in 1963, and continues to operate to this day. Following the tumultuous events in recent times, the government carrier has tragically suffered two fatal blows to their brand reputation. Arbitrary missing flights as well as missile shootings forced the company to rethink its strategies.