The Air Transportation Stabilization Board

Decent Essays

The terrorist attacks on September 11, 2001 shook the United States in a profound way, deeply upsetting the national perception of safety within U.S. borders. No industry or sector of the economy felt the impacts of these events more than the airline industry. Both the immediate reaction to the attacks and the long-term repercussions have negatively affected the industry. Today’s airline industry is much different than it was prior to September 11. There is a much smaller work force, more low-cost carriers, more security and more fees associated with flying.
Directly after the terrorist attacks, the government closed airports, canceling thousands of flights at a direct cost to airlines. Passenger travel fell drastically due to our air space being closed temporarily, but the main reason was the loss of consumer confidence. Airlines experienced roughly a 30% reduction in consumer demand immediately following the attacks.
The Air Transportation Stabilization Board was created in the weeks following the attacks. The board was authorized to give faltering airlines up to $10 billion in government backed loans. Despite this government funded measure, several prominent airlines declared bankruptcy. At the same time that the industry was facing this large-scale drop in the number of passengers, low-cost carriers grew significantly and air fares decreased. As a result of the massive financial losses due to lack of passenger demand, canceled flights and increased expenditures for

Get Access