External Environment Of The Airline Industry

1793 Words Nov 9th, 2015 8 Pages
The external environment of the Airline industry can be divided into four parts, which include customer segments, competitor groups, route structures, and passenger service segments. Each of them plays a vital role for almost airlines. There are two categories of passengers, leisure travelers and business travelers. The U.S. airlines can be divided into three major groups based on the geographical coverage, which are national airlines, the regionals airlines, and the commuter of feeder carriers. In addition, most airlines have two classes of service, first class and coach. Passenger service is different for each airline, an airline may choose to provide meals, drinks, Spartan services, or advance seat. (Jackson, Schuler, & Werner, 2011)
 Outlook for the Airline Industry
Compared to last few recessionary years, the outlook for the airline industry is brighter and more positive. However, there are still several threats the whole airline industry is facing now. For one thing, costs are rising because of some factors, including the increases of price in gas and interest rates, the loss of concessions labor union gave during the lean time, or changes in government regulations. The rising cost means higher fare for customers, which means less customers would like to purchase plane tickets. Next, there are many factors can also reduce customer demand, such as technology failures, safety issue, political issue, and changing economic condition. (Jackson, Schuler, & Werner, 2011)
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