Political-Legal Environment: Delta Airlines

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Political-Legal Environment: Delta Airlines Delta Air lines is not immune to the political and legal structures that exist both domestically and globally. There are many factors that affect the political and legal structures for Delta in their domestic environment of the United States and also in the global environment of Europe. Teresa Cederholm in her article on MarketRealist.com states “The airline industry is widely impacted by regulations and restrictions related to international trade, tax policy, and competition” (2014) She goes on to elaborate further on issues that impact the airline industry such as “war, terrorism, and the outbreak of diseases” (2014). All of these issues require the government to set in and set different…show more content…
Cederholm states that “After the deregulation, passengers benefited from additional routes through the hub and spoke model [and] competition also increased” (2014). With the deregulation, customers saw a price drop in airfare causing using air travel more accessible to a wider range of Americans. In a Smith and Cox article on the Airline Deregulation, they state that “Airfares, when adjusted for inflation, have fallen 25 percent since 1991, and, according to Clifford Winston and Steven Morrison of the Brooking Institution, are 22 percent lower than they would have been had regulation continued” (2008). With the increased competition and lower prices, many airline companies have opted to merge instead of competing with each other. There have been mergers between U.S. Airways and American West, Northwest and Delta, United and Continental, AirTrans and Southwest, and American with U.S. Airways. According to Cederholm, “These carriers, along with JetBlue and Alaska, account for more than 90 percent of the U.S. market share seat miles” (2014). These mergers help the major airliners, such as Delta Air lines, with reducing competition with the low cost low frills airlines. The biggest barrier for Delta Air lines is with the European Union’s carbon emissions tax for all airlines traveling in and out of Europe. According to Crawley and Quinn, “under the mandate that
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