Fig 5.4 : Price Shareholders Of Hainan

(1)One of the biggest challenge of Jetstar is the tremendous increase in fuel cost. Because of the rising global fuel demand, the crude oil price rose over 50% over 10 years with rapid fluctuation and the fuel for airlines increased concurrently. Although Jetstar took significant steps to mitigate the impact of fluctuating and increasing airline fuel price, unavoidably its profit was influenced adversely.

The Airline industry today offers services to nearly every place of the globe. The following economic factors that include consumer behaviour, currency rate, purchasing power of consumers, oil price plus the inflation plays key role in deriving the country’s economy. According to (Macmillan & Tampoe 2000), Airline industry itself is a leading economic force in terms of both its effects on associated industries for example aircraft manufacturing, operations and tourism. In this regard, this paper discusses the economic factors that affect the decision, the board of Air Asia needs to consider before acquiring 10 units of Air Bus model A350-1000 to increase its fleet of long haul airplanes.

The situation of the U.S airlines has been affected by a number of factors through time and is not a secret that has been passed by moments difficult, especially in the economic part. One of these factors were the terrorist’s attacks of 911. No other event in history has changed the way of doing business that the fateful events of September 11, 2001. Apart from the significant human loss, the millionaire impact to the economy of New York and in the United States and multi-million dollar expenditure associated with the global war against terrorism, attacks on the World Trade Center (World Trade Center or WTC) in New York and the Pentagon trembled the authority of the United States, at a time when it was going through a recession. All this made

The airline industry has recently been focusing inwardly on revenue growth, yield management, and balance sheet strength. The permanent threat of terrorism creates an element of uncertainty when it comes to an airline company’s operations. There are significant challenges to implement effective security and risk management systems. Large investments in required infrastructures are correlated to these challenges (PriceWaterhouseCoopers, 2014). There is also a strong demand for public transport recently as a result of environmental awareness and congestion. Railroads have difficulty meeting this demand because of a limited infrastructure capacity. This public transport competes with roads for investment funds and many planning processes for railroad projects take a long time to deliver (PriceWaterhouseCoopers, 2014). The shipping subsector contributes an extreme amount to global transportation and logistics. It has been historically cyclical with volatility in vessel values, shareholder returns, and freight rates. The international economic and political environment also has a large effect on shipping. The business environment is challenging with a few specifics risks. Risks include increasing regulation, a risk

Airlines usually buy new jets under long-term fixed price contracts. This effectively shifts the financial risk to the aircraft manufacturer as they have no certainty of the future, thus giving

The author Triant Flouris is the professor of San Jose State University, Thomas Walker is the professor of Concordia University. They collect accounting data from companies’ annual report and daily stock price from Toronto Stock Exchange, in order to examine the accounting and stock price performance of WestJet and Air Canada, two Canadian airline companies, how they deal with the series problems after 911. Their study focus on the ability of airlines react to the sudden disaster. They find out that low-cost airline such as WestJet can respond to the industry disaster faster than conventional-cost airline such as Air-Canada due to their flexible variable cost structure. This journal provide one of the important success factors of WestJet,

1. There are a few trends in the US airline industry. One is consolidation, wherein existing players merge in an attempt to lower their costs and generate operating synergies. The most recent major merger was the United Continental merger, which is still an ongoing affair, but has created the largest airline in the United States by market share (Martin, 2012). Another trend is towards low-cost carriers. In the US, Southwest has been a long-running success and JetBlue a strong new competitor, but in other countries this business model has proven exceptionally successful. The third major trend is the upward trend in jet fuel prices, and the increasing importance that this puts on hedging fuel prices and capacity management (Hinton, 2011).

Keep in mind, airlines only make money by having planes in the air; Delta has shown to invest their funds, assets, and efforts into that for the short term measures, as well as the future, whereas Southwest has allocated their assets, so it appears, for only the here and now, limiting the future of their profitability. A further example of this for Delta is their purchase of the oil refinery, increasing their short and long-term debt; however, this also decreased their operating costs with the production from the oil refinery for the short- and long-term reduction of debt through operation and inventory costs. Additionally, the ROA for Delta is double that of Southwest, ensuring that not only is the company excelling but also the shareholders are as well. This is a volatile industry, and one that has had numerous economic issues since the 9-11 tragedy, as well as Delta being much larger than Southwest. The industry is heavily influenced, as well. by political economic policies and standards that are exacerbated in the security and EPA regulatory arenas. The inventory turnover is showing that Southwest has a weaker sales structure than Delta, by far. Asset utilization and management efficiency is shown by this ratio, as well as customer service are shown as high

The airlines is experiencing an upward trend with the leverage ratio. The company will make large interest payments that would effect the bottom line.

IntroductionThis report is to check the hedging strategy that was used and lead to the huge loss of CITIC Pacific Limited and point out the importance of managing foreign exchange exposure through select appropriate hedging strategies. The huge loss of CITIC Pacific Limited and its cause is discussed in the first part. The importance of hedging and the tools of hedging are respectively reviewed in part two and part three. Finally, suggestions are given out on how to design proper hedging strategies for different enterprises.

Air Canada is faced with many different kinds of risks such as fuel price risk, foreign exchange risk and interest rate risk through the use of various financial derivative instruments. Under its risk management policy, Air Canada uses these instruments solely for the risk management purposes, not to generate trading profits. Any change in cash flows associated with the derivative instruments is designed to be offset by changes in cash flows of the relevant risks being hedged.

Airline Industry is 500 billion dollars, creative and dynamic industry. In early 2001, airline business was going through very rough patch because of economic crisis

This paper delves in describing the various techniques used during the capital budgeting process as well as in the investment decision making process and their weaknesses as well as strength areas. It also contains the capital budgeting analysis of Airvalue Airways. Airvalue Airways is faced by a dilemma as to which plane to invest in between the two investment options it has. In this case we use the NPV method to make the decision on which plane to invest in. We will also calculate the cost of common stock using the capital assets pricing model and the Weighted Average Cost of Capital (WACC) will be used as the discounting factor when taking into account the time value of money.

This paper discusses the external economic factors affecting the strategic decision of airline industry and how this decision in turn, affect the market forecast of the aircraft manufacturing industry. Various business issues affect airlines operation either directly and indirectly, and

Economy airlines suffer during down economies and reduce their orders, and the industry has become dependent on the Middle East and Asia in recent years to offset this (Crooks & Weitzman, 2010).