preview

The Discontinuation of Certain Flights of United Airlines: A Discussion

Decent Essays

The Wall Street Journal espousing the fact that certain analysts believe that United Airlines should discontinue certain flight service from San Francisco to Washington, D.C. does not necessarily mean that United Airlines should do so. In fact, United Airlines must certainly consider that action as one of the options available to them, but it other options are equally as accessible, and may make a lot more sense. Although accountants are charged with the responsibility of making sense of the numbers, company executives are charged with seeing the 'big picture' and making decisions based on what is best for the entire company, even if that means that some flights are less profitable (or not profitable at all) than others. Company leaders at United have to understand the market structure including what would happen if the decision was made to drop the unprofitable route. If United was to give up that particular route the question then becomes 'what are the ripple effects?' of that decision. The negative aspects of such an action as dropping an unprofitable flight might lead to further negative consequences. As one recent report touted "It is no secret that the airline industry is bracing for a tough 2012" (Shannon, 2011, p. 24) and United must take that into consideration as well. When airline companies are forecasting rough seas, decisions such as dropping unprofitable flights become even more important. On one hand, dropping the San Francisco to Washington flight may

Get Access