A recent article in Fox Business talked about the state of the Airline Industry and how it is looking coming out of a major economic recession. Airlines have undergone numerous changes over the past decade. One in particular has been the change in the price of fuel. Over the past ten years, fuel costs have more than doubled, which has caused most major airlines to readjust their business models. Some airline companies have also consolidated in an effort to stay alive as best as they can. Other airline companies are in the process of designing jumbo jets that are more aerodynamic to help cut down on fuel as well. Boeing and Airbus are two airline manufactures that are going head to head in the design of some of these new airplanes. Unlike many of the airplanes that are manufactured, these new planes are constructed with carbon composite materials, which helps make them more fuel efficient. With airline companies trying to save as much money as possible, these new composite planes are becoming more and more sought after.
The aviation industry is looking to make changes for the better and they are beginning to see progress. Jonathan Kletzel, PwC’s U.S. transportation and logistics leader, stated “There’s no question the domestic airline industry is undergoing a renaissance marked by increased revenue and stable profitability. These factors, combined with the prospect of lower fuel prices, support a positive outlook for the industry in 2013.” It is becoming more apparent than ever that airline companies need to do whatever they can to help themselves out. Delta went as far as to put $180 million into a refinery on the East Coast in order to take it over.
People don’t want to spend exorbitant amounts of money to fly to their destinations. Airline companies are doing everything they can to cut costs so they can offer affordable ticket prices. They want people to feel encouraged to fly and to not shy away from it. It will be interesting to see where things progress in the next couple of years. Will airline companies continue to see increased revenue and stable profitability?
via Barry Oberholzer http://barry-oberholzer.com/airline-industry-looking-ahead/
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