Case Analysis American Airlines
Case Analysis of American Airlines
In an attempt to generally identify the airlines and travel industry this analysis will examine the "key players" in these industries. Whenever we think of the airline industry by definition the key players in this industry include commercial/private airline companies, employees, aircraft manufacturers, customers/consumers of flight service, travel agencies and government entities responsible for regulation of the industry.
Currently the airline industry as a whole seems to be on the road toward recovery. Even before the September 11, 2001 terrorists attacks, industry-wide revenues and profits were far below expectations. This pre-attack downturn was an indirect result of the dot.com bubble burst as well as the discovery of high level corporate fraud. The stock market doesn't react positively to this kind of data and beginning in April of 2000 the surge in growth of the U.S. economy took a sudden turn for the worst. As early as June of 2001 these factors coupled with delays of service, customer complaints, and lack of upgraded infrastructures in the commercial airline industry helped to propel the profits of all the key players, (Lower profits for Southwest), into a negative downward spiral. The 9-11 attacks were unfortunately timed perfectly. They hit us when we were already down. If the cruise ship industry was targeted, the recovery would have no doubt been speedier and the damage more sustainable. The commercial airline companies, because of these factors, have absorbed the negative impact with much less tolerance and recoverability. In April of 2001 the Air Transport Association (ATA) predicted a slower growth rate for the industry in the U.S. With traffic and profitability shown to be lower in and already struggling economy it is clear that this industry couldn't absorb the attack losses even though global capacity was expected to increase by 4.5%. The rush to reduce capacity and keep growth in operations in the
In an attempt to generally identify the airlines and travel industry this analysis will examine the "key players" in these industries. Whenever we think of the airline industry by definition the key players in this industry include commercial/private airline companies, employees, aircraft manufacturers, customers/consumers of flight service, travel agencies and government entities responsible for regulation of the industry.
Currently the airline industry as a whole seems to be on the road toward recovery. Even before the September 11, 2001 terrorists attacks, industry-wide revenues and profits were far below expectations. This pre-attack downturn was an indirect result of the dot.com bubble burst as well as the discovery of high level corporate fraud. The stock market doesn't react positively to this kind of data and beginning in April of 2000 the surge in growth of the U.S. economy took a sudden turn for the worst. As early as June of 2001 these factors coupled with delays of service, customer complaints, and lack of upgraded infrastructures in the commercial airline industry helped to propel the profits of all the key players, (Lower profits for Southwest), into a negative downward spiral. The 9-11 attacks were unfortunately timed perfectly. They hit us when we were already down. If the cruise ship industry was targeted, the recovery would have no doubt been speedier and the damage more sustainable. The commercial airline companies, because of these factors, have absorbed the negative impact with much less tolerance and recoverability. In April of 2001 the Air Transport Association (ATA) predicted a slower growth rate for the industry in the U.S. With traffic and profitability shown to be lower in and already struggling economy it is clear that this industry couldn't absorb the attack losses even though global capacity was expected to increase by 4.5%. The rush to reduce capacity and keep growth in operations in the