Nature Of The Airline Industry Tourism Essay

Nature Of The Airline Industry Tourism Essay This report identifies the business environment and draws comparisons of the airline industry pertaining to countries, India and China. An attempt has been made to put forth the analyses of the broad macro-environment factors of the industry in terms of Political, Economic, Social, Technological, Environmental and Legal factors (PESTEL). Apart from the above, the Five Forces analysis has been carried in order to assess the attractiveness of the industries and understand their potential for change. The Airline industry with relevance to this report comprises of air transportation which includes both scheduled and chartered flights but excludes air freight transportation. The Focus of this report is to provide an outline of the present environmental conditions in terms of the nature of the airline industry, its structure, outlining the strategies employed by the players in the airline industry to sustain in tough economic environment and make an attempt to forecast the future environmental conditions. Our prime justification to compare the industry from India and China lies in our belief that the two countries would and probably are transforming the global economy in the 21st Century. India and China have achieved growth which fared twice as much as the global economy growth. A huge and demanding consumer class is also pushing the economy northwards and it is essential for the countries to meet the aspirations of a demanding economy. Overview of the Global Airlines Industry For the past two years, 2008 and 2009, Airline Industry was negatively affected by the economic downturn and the oil price hike. Now that the global economy is showing signs of recovery, demand for air travel is increasing from the previous years depressed levels. Combating the recessionary effect has not been easy as various measures like cutting costs; slashing capacity and increasing load factor were adopted by the airline companies globally. Global Airline industry reported revenues of USD 380.5 Billion in 2009, achieving a Compounded Annual Growth Rate (CAGR) of 2.5% for the period 2005-2009 (Datamonitor, Global Airlines Industry). The total number of passengers in the Airline Industry for the year numbered 2002.7 million and the numbers are expected to grow at a CAGR of 5% to 2551.5 million passengers by end of 2014. Strong rivalry and supplier power characterizes the global airlines industry. Even though there are large number of buyers, Product differentiation is minimal and involves negligible switching costs. It also leaves the carrier vulnerable to reduction in demand in the industry which is sensitive to the wider economy. Supplier power in the global airlines industry is strong as reliability and safety of the flights are critical. Entrances to the airlines industry are restricted due to economic barriers. The up-front costs are huge and substantial financial backing is required to cover the initial costs and ex penses henceforth from there. Airline companies today are forming alliance with other companies with the intention to achieve diversified network of operations, scale economies in terms of purchase of fuel, and even sharing of aircraft to reduce the power of the supplier. Code sharing has risen as a phenomenon catching up in the Asia Pacific region of the world where companies are forming alliances with other carriers around the world. Consolidation is a major opportunity for the players in the airline industry to increase their revenues, cost savings and enhance competitive position. The global airlines industry is projected to benefit the service providers as there is a new customer base in the present arising from the emerging economies which will fuel the growth of the industry and would see emergence of new players giving more competition to the existing ones. With continued and sustainable demand for air travel, Airline companies would see opportunities which would be coherent with the rising aspirations of people. The Indian Aviation Story In the year 2003, the whole world celebrated the centenary year of the powered flight. Indians had to wait for more than a decade to see the first aircraft airborne from the Indian soil. In the early December of the year 1910, a group of people from Belgium and England came to India with several airplanes. The idea was to showcase the marvel of a flying object and to explore business opportunities from it. Planes were showcased after assembling its parts. The groups were able to have a successful trip as their products were well received and were brought in by the royalties in India. It was December 15th 1932 when the first flight in India taken off under the name of Tata Aviation, which later went on to become Air India. Tata Aviation was started by JRD Tata after much protracted negotiations with the government of India. Eventually, during 1953, an act of nationalizing all the airlines was passed in the parliament and Tata Aviation went on to become Air India which then served the international traffic. The Indian Airline industry has come a long way today. In the year 2009, Indian Airline industry grew by 9% to reach the value of USD 7 billion. It grew by 35.5% to reach a volume of 73.8 million passengers. By 2014, it is forecasted to have a value of USD 17.9 billion and volumes of 156.2 million passengers. The Indian Airline industry experience growth even after seeing a period of decline in 2008. While the growth rate of Indian Airlines industry was far better than that of China, The airline industry in India could achieve merely one thirds of revenue when compared to the Chinese Airline industry. Like the global airlines industry, Indian airlines industry is characterized by strong rivalry and supply power, the buyers being leisure travelers and business travelers while fuel suppliers, aircraft manufacturers and skilled employees as the key suppliers. High Price sensitivity due to product differentiation being minimal strengthens the power of the buyers. Supplier power is strong as airlines enter into contracts with the suppliers and the industry lacks alternatives or substitutes. Price sensitivity is high and availability of alternative strengthens the buyer power. The entrance into the market poses economic barriers as there needs to be solid financial back up to enter into this industry. Distributions and establishing networks and booking presence regionally are of critical importance for the success of a company. Rivalry in the Indian Airline industry is strong and has increased since the presence of the low cost carriers. Costs are the determining factor for airlines as the Indian consumer today is more price conscious than ever. Over the past two decades, the Indian Airline industry has experienced both stagnation and unprecedented growth. The potential for growth in the Indian Airline industry remains strong as with massive population with growing incomes only adds to the fact that the Airline Industry has a long way to go. Currently, only 2% of the Indian population prefers to fly by air. Between the year 2003 and 2006, Indian Airlines industrys open sky policy opened the floodgates for the arrival of new start up carriers which changed the face of the industry beyond recognition. Liberalization in terms of allowing the domestic carriers to go international and allowing the international carriers greater access to the domestic market spurned the industry to achieve double digit growth. However, the increase in traffic increased the top line of the players in the industry, but due to low margins, lower yields, inadequate airport infrastructure and lack of trained pilots and engineers saw many of the compani es bleeding with negative bottom lines. As rising oil prices in the year 2008 hurt airlines all over the world, Indian tax systems made the matters even worse as it added 60% of total costs. Carriers were left with no other alternative but to pass on the burden to the customers who in turn chose alternative forms of transportation leading to 10-12 percent drop in traffic. A more positive environment is starting to emerge as the Centre for Asia pacific Aviation (CAPA) report suggests. According to CAPA, the airline industry is India is on the path of recovery as figures from the mid year 2010 have suggested. Better operating environment, with gradual upgrade of airspace and ground access development, would only help carriers achieve faster turnaround and higher aircraft utilization. The potential lies in the Indian Airlines Industry with CAPA predicting the industry having 1000 planes from 400 in the present and 4 times increase in traffic from the current trends. The performance of the industry is forecasted to accelerate and drive the industry to create positive value for the service providers as well as the customers. Environmental Analysis An assessment of external macro environment can be carried out by analyzing the Political, Economic, Social Technological factors. These factors are beyond a company or an industrys controls and sometimes can pose as threats. Following are the PEST analysis for the Indian Airline Industry. Political Factor In India, Political interference has effects of all the major industries. The airline industry in general is very susceptible to the political environment of a country. A country with unstable political environment can cause doubts in the minds of the traveler to travel to that particular country. India in particular has had to go through a lot in the recent years with mounting tensions with its western neighbours. The 26/11 terrorist attack on the financial capital of India has a profound impact on the airlines industry. Another example of political factor causing problems for the Airlines Industry in India lies in the corrupt state of affairs that lies in the administration. Bribes have to be paid to obtain licenses and permits. Even recently, one of the most respectable businessmen in the world, Mr. Ratan Tata complained about the corruption problem which discouraged him to start his own Airline Company. It was alleged that the civil aviation minister had asked Mr. Tata a sum of I NR 1.5 million as a bribe to give permit to start air services. State owned airline companies suffer the most because of this problem as due to political pressure, the government companies have to give special consideration with respect to route selection, offering free seats to the ministers etc. The state owned airline companies cannot stand up to the archaic laws, regulations and trade unions which in past have held the state owned enterprises on ransom. Currently, In terms of Investment FDI of 100% is allowed in the Airline Sector under the automatic route for Greenfield projects. Economic Factors Airline Industry is greatly impacted by the business cycles. It is considered a luxury to fly during the recession which then leads to cuts in spending eventually leading to reduction in the air fares. During prosperity, People spend more and that leads to increase in air fares. Recent global recession has had a deep impact on all the major industries in the world. Aviation Industry too had its own share of set backs. Corporate travelers were cutting back on travel which would save costs and leisure travelers had deferred their travel plans. Even a company like Citibank in India had to cut down its costs to increase its profits for which even the top managers were allowed only to travel by train. The loss of income due to economic factors forced the airline companies to execute the corporate restructuring program which resulted in several employees being laid off. Turnaround time, maintenance costs, jet fuels costs, staff costs, benefits costs etc. are some of the expenses which the airline companies have to take into consideration while pricing their air tickets. Anything below these costs the company losses which makes the company unsustainable in the industry/ Social Factors India, being a diverse country has people coming from different parts of the country with different culture, language, food and preferences. Airline industry need to understand this along with the fact that there are people with varied income group and their needs should be served accordingly. India is a land of extremes with people coming from different walks of life. For example, a person subscribing to Jain religion needs to be served a special Jain food and it could be kept in mind that the person sitting next to him can be a vegetarian. One of the finer examples can be drawn from South West Airlines which is a low frills airlines which has created a niche for itself in that segment. It has also successfully augmented its marketing mix strategy which has done wonders for it. Technological Factors Internet has opened avenues for the airlines industry in a way which could never have been comprehended. For Example, Jet Lite has introduced a service on its website where it auctions few unreserved seat on the flight one week prior to the departure date. Almost all airline companies offer their services through the internet. Right from booking the ticket to choosing the seat where one would prefer to sit on the flight. Apart from this, choosing the food from the menu can also be selected through the internet. Another good example of the impact of technology would be that of the Airport Authority of India, which with the help of technology was able to lease out its obsolete and unused hangers to international airlines thereby making huge profits out of the same. Technology development helps reduce costs, saves time and enhances service performance which is critical in a competitive industry like the Airlines industry. Porters Five Forces Michael Porter introduced a framework that models a sector or an industry as being influenced by five forces. This analysis has five-core element. These are 1. Bargaining Power of Suppliers 2. New Entrants 3. Threat of Substitutes 4. Competitive Rivalry 5. Bargaining Power of Customers Bargaining Power of Suppliers Suppliers for the Indian Airlines industry like other locations around the world as far as flight manufacturers are concerned are very limited. Globally, Airbus and Boeing are the only suppliers of aircraft which suit the industry requirements. There is limited bargaining opportunity for the Airline Industry in India hence is a threat for the industry. New Entrants It was difficult for a new player to enter the Airline Industry in India. There were lots of barriers to entry. Capital Investment to enter this industry is very high but banks have increased the possibilities to avail short term or long term loans with less interest rate thereby increasing the threat of new entrants in the present markets. Threat of Substitutes International routes do not have any threats as there is hardly any other form of feasible transportation available. However, Domestic travel can be competitive as high airfares encourage customers to look for alternatives ways to get to their destinations. Rail Road are probably the only feasible option available as they are only economical for shorter distances. A customer would prefer to travel long distance via road or rail only if the time factor allows the customer to take the alternative options. Competition Rivalry Rivalry within the industry is pretty intense at the moment as all the airlines are vying for attract customer by offering lower fares, membership privileges, free meals on board and other additional benefits to grab the customer from the competitors. Bargaining Power of Customer Indian travelers are highly price sensitive. With availability of many airlines to choose, cheaper price difference might just switch the customer to choose from one airline to another. Customers have some chance of bargaining in the domestic market as competition is intense in it whereas International routes gives less operations to bargain.

The Alamo Essay -- History Texas Essays

The Alamo "To the people of Texas and all Americans in the World: I shall never surrender or retreat ... I Am determined to sustain myself as long as possible and die like a soldier who never forgets what it is due to his honor and that of his country-VICTORY OR DEATH." This was a letter sent by William Barret Travis during the siege of the Alamo on February 24, 1836. It was a cry for help to anybody and everybody willing to listen. It all started in 1830 with Stephen Austin, a leader of American pioneers in the wild, living in Texas, under the rule of the Mexican government, who had solved two major problems that the settlers had with the government. The colonist were now allowed to keep slaves in Texas, even though no other areas under Mexican rule owned slaves, and the second was the government made sure that Texans would be protected by the Mexican government from suits to collect debts that they had contracted in the United States before their immigration to Texas. All over the South were signs on bankrupt homes homes saying "Gone to Texas" were they did not have to pay off their debts . Austin and his followers were very hot tempered and ready to start up with any government that they disliked. They soon found a chance to stir up trouble under the changeable Mexican rule. Mexican authorities began to worry that too many Americans were coming into their country. About thirty thousand settlers came to Texas in a ten-year span after Austin had established his settlement. The Mexican government under the urging of President Bustamante made harsh laws against arrival of new immigrants into Texas in 1830. Trade was also restricted with America. All borders were closed to newcomers but the Louisiana border could not be patrolled and settlers continued to arrive in Texas. American settlers were put into jail for the ruckus they caused due to these new laws, among them was Stephen Austin. On July 1833 Austin traveled to Mexico City to plead the cause of the colonists. The colonists wanted to obtain full Mexican statehood and have total control over themselves. Mexican officials would not listen to the Texans. On his way home Austin was arrested for treason on January 3, 1834. The government had intercepted a letter from Austin that said that if his appeal had failed the Texans should establish themselves as a separate state of Mexico. He was j... ...their might charging at the enemy screaming " Remember the Alamo". Their incentive in winning was the one hundred and eighty deaths at the Alamo. This inner strength that they obtained from the defeat at the Alamo helped the others defeat the Mexicans and finally win their freedom from the yolk of the Mexican government and eventually being accepted as the twenty-eighth state in the United States of America. But the acceptance would not come easily. They had problems being accepted due to the fact that the ownership of slaves was considered all right in Texas but the North did not want to accept more slave states. Eventually on February 19, 1846 they were accepted as a state. I never really knew what it was before this and was always wondering why it was such an important event in Texan history. The one thing that confuses me is why the State of Texas would choose a war that they were totally destroyed in as an event that is considered greater than most other events throughout Texan history. But for one thing I truly admire Travis and his followers for fighting to the death like heroes in order to establish freedom and their rights they believed that in all truth deserved.

Vincent Tinto And Student Retention

Vincent Tinto is currently a Distinguished University Professor at the Syracuse University a position he has held since June 1998. Prior to that, he was a Professor of Education from June 1985 to June 1998 and an Associate Professor of Education since September 1975 to June 1985 at the same university. In the period September 1971 to June 1975 he was an Assistant Professor of Education in The Columbia University New York. He is also currently the chair of the Higher Education Program a position he has held since 1999. His academic background is also very impressive. He did his undergraduate studies in Fordham, The Jesuit University of New York in 1963 where he graduated with a bachelor of science in Physics and Philosophy. He went on to Rensselear Polytechnic Institute to pursue his masters’ degree in Physics and Mathematics in 1965. He holds a Ph. D. in Education and Sociology which he got from the University of Chicago in 1971. It is noted that while he was pursuing his doctorate he dropped out of school to join the Peace Corps and this may be one of the reasons why his researches major on student attrition and the ways to retain them in school. In this paper, the discussion will revolve around the arguments that he presents in the course of his numerous researches and in his body of works. The professor is of the view that to retain students in school all that the schools have to do is provide quality education. He tries to explain the reasons why students dropout of school especially after the first year of college (Tinto V. 1975). He also tries to provide the solutions that may work in retaining the students in the school especially through the provision of better and quality education to the students. This is done with the assumption that students want to be in school but other factors end up pushing them away. Looking at the way he approaches the issue, one notices that he lays most of the blame on the faculty. In his opinion, students would rather be in school but the faculty and education systems fail to meet the expectation of the students and hence their inability to continue being in school. They end up not trusting an education system that does not seem to meet the standards they expect an institution of higher learning ought to possess. The reception they get at the school also determines a lot if they will make it to the end of their course or they will drop out midway. According to Professor Tinto, there are three main factors that determine whether or not a student will complete their college education and these are â€Å"academic preparation, commitment and involvement† (Seidman A. & Tinto V. 2005). Although there are other factors, these are the ones identified as being most common among most of the cases. It has become of paramount importance for the schools to be able to retain their students because the graduation rate has become one of the factors determining the rating of a college. In order for a school to upgrade its position or maintain the one it is currently holding if it is a good position, a way has to be found to retain the students who are at risk of withdrawing from school. Professor Tinto among others have been conducting researches to determine what makes student leave school while others faced with similar problems persist. He conducts interviews using high-risk students who have succeeded in college as his subjects. He focuses mainly on those who are in the two and the four year courses and are under prepared and underrepresented in terms of college education. He tries to find out from them which factors enabled them to persist when others failed. As stated before, commitment, preparation and involvement are the key factors determining whether one will remain in school or one will quit midway. In an article he wrote with Cathy Engstrom ‘Access Without Support is not Opportunity’ (http://www. changemag. org), they give the example of Donald who dropped out of college after transferring to a different school. He is an example of students who drop out due to being disappointed by the college. He starts off college in a school where the teachers are concerned with the students’ welfare and the environment is challenging. However, due to familial problems Donald is forced to move to another college which he feels lacks in quality when compared to the previous school. Professor Tinto notes that, although in Donald’s he later went back to school, not all dropouts go back to finish their education. It has been recorded that majority of high-risk students especially those who are low-income do not complete their college education. In the case of the four year degree courses, only about 26 percent of low-income students finish in a period of six years when compared to the 56 percent of high-income students who achieve the same (http://www. changemag. org). The reason given for this is that they are academically under prepared especially because they do not have access to academic resources in a manner similar to that of the high-income students. This leads to feelings of inadequacy and helplessness among the low-income students often resulting in their dropping out of school. They tend to view the time spent in school as a waste of their time which could be used to generate income by working. This decision is made because they cannot foresee ever getting the same grades as the high-income students since they are not on the same level. This means that their lack of preparation leads to their lack of commitment to the education that they are receiving. Lack of commitment then obviously leads to very high rates of dropping out of college. To deal with this problem, the faculty has to get involved since as professor Tinto sees it they are the main perpetrators of the problem. In Donald’s case, although he had not been well prepared for college, in his first school the teachers were concerned with his welfare and hence he was able to feel welcome in that school and able to concentrate on his studies. This corresponds to the idea that student-faculty out of class contact is very important to a students’ academic growth (Tinto V. 1993). When a student feels free to approach a teacher out of class, even if he or she was not well prepared when enrolling in the college, there is a high possibility that the student will succeed. The reason given for this is that the student will be able to ask for assistance and guidance from the teachers. This assistance may be academic or personal for example in choosing a career one may be able to get the best guidance from the teachers who know which are the student’s strong and weak points. A student may also be suffering from personal problems that affect his or her academic performance and by opening up to a teacher may be able to get the extra help required for excellence in the academic field. A teacher may also be able to assist a student with required material for the class or direct the student where to get the material if they do not have it or are unable to afford (Tinto V. 1975). From his research, Professor Tinto has found out that most of the students who succeed in college yet were in danger of dropping out attributed their achievement to contact with a faculty or staff member although this was rare (Tinto V. 1975). This contact with someone affiliated to the school helped the students get into the rhythm of college life and gave them someone to approach whenever they had problems in the school. They also got a point of reference when setting their goals of what they would like to achieve since they now had real life models to emulate and learn from. The student-faculty out of class relationship is very important as it leads to various positive gains by the student thus ensuring their retention in school. The student involved in this sort of interaction feels more satisfied with the faculty and the college as he or she feels welcome in the school. They develop both personally and intellectually while gaining the ability to think critically by being constantly in the presence of someone with experience in the field. The perception that the student has of the quality of the college improves consequently leading to their improved performance and in class while raising their educational aspirations. The overall result of all this is the persistence of the student to graduate since they have dreams to achieve (Tinto V. 1975). All the above is possible because the student has become committed to the education that he or she is receiving which is one of the key factors that the professor talks about. The student feels that there is a responsibility to attain the best grade possible because there are people helping him or her and it would be wrong to let them down. Furthermore, they have their appetites for education and also betterment of their futures through the same whetted and they also feel proud of having done the best that they could. There is also a sense of not wanting to be the one who let the entire school down through bad performance and dropping out. The third key factor that the professor talks about is the importance of the involvement of the student in the school society/community. He has come up with the idea of Learning Communities which involves the participation of both the faculty and the students. These communities work in creating a sense of community in the school that helps the students feel that they belong in a society that welcomes them. These communities are not for students only but faculty members can also form their own communities that aid them in providing the best possible education to the students while making learning easier and more enjoyable for both parties (Tinto V. & Engstrom C. 2002). Learning Communities are described as teams that meet on a regular basis a number of times in a week. These teams have an agenda to improve their work for the collective betterment of the school. The members also want to improve themselves daily by engaging in discussions within the group that aid in the attainment of the schools goals and also their individual goals. This is done independent from the classroom experience which also takes place. However the classroom influences the teams because members of the same group have top have similar interests which are determined by what is done in class. In the case of students, those pursuing similar courses tend to be members of the same group because they can discuss the same things in the group and also have the same goals. The students will meet several times a week at a time convenient for all the group members’ other than class time. Their discussions will revolve around the class work and the problems each encounters when attempting the same. In case there is a major problem common to all the members they have the opportunity to get in touch with a teacher and discuss the problem and get the necessary assistance (Seidman A. & Tinto V. 2005). When it comes to the faculty members, they may decide to meet weekly or twice a month to discuss ways in which they can improve service delivery to aid the students in their education. They also offer their criticism concerning the students and try and work out which ways would be best to improve the students’ performance. They also share the common problems that they encounter when performing their duties and discuss the ways in which they can make their work easier and the best ways they can deal with the problems. It is important for both students and faculty members to be involved for the Learning Communities to work. The students have to be able to count on the teachers support when addressing their issues and know that the teacher will respond to their queries. The teachers have to be available for consultations with the students. The students must be able to find time outside class when they can meet and address their problems and discuss class work. This is when this theory meets a hurdle in its implementation because time is a rare factor in college. It is almost impossible to find the people all having some free time at the same time and if the students manage it the teachers may not be available at that particular time. In conclusion, one has to give Professor Tinto credit for the work that he has done in trying to come up with ways to deal with the problems that students encounter in their college life. He has dedicated a lot of his time to researching on how to make learning easier and pleasurable to students so as to avoid their dropping out of school. He focuses on the failure of the faculty to provide a good learning environment thus causing the students to feel that the education they are getting is not worthwhile. He shows the different ways that this can be remedied to ensure that students remain in school and get good education. From his interviews, he arrives at the conclusion that for a better learning environment to be attained the students and the faculty has to change their attitude towards learning by making the learning institutions more welcoming to students. This is done by improving the out of class faculty-student relationships which aids the students get attuned to college life. It can also be done by forming learning communities which help both the students and teachers improve the education in the school and consequently the overall grade of the school. However, as much as his arguments as very valid and his solutions reasonable there are problems that are encountered in executing them. The students and faculty members claim not to have the time to be involved in the learning communities and in the student-faculty out of class meetings. However if they were to be implemented, they would be able to work beautifully. It is however important to note that not all students will be retained since some dropout of school for other reasons different from the ones discussed by the professor but the ones discussed can be greatly reduces if the measures were to be implemented.

The Perception Of Fantasies Are Never Within Line With The...

The perception of fantasies are never in line with the terms of reality. Have you ever fantasized a perception for something, but then come to find out that it was nothing compared to what you thought it actually was? An occurrence such as this exemplifies the manifestation of one of the normal aspects of life. Sometimes in life, the perception of first appearances and certain things, contradict the terms of reality. This usually takes place when the forces of adversities that we encounter cause us to perceive unrealistic fantasies. Our ultimate control powered by the tools of imagination, fuel the inclination to perceive these things. This occurrence is clearly seen in â€Å" Araby†. In the short stoThe perception of fantasies are never in line with the terms of reality. Have you ever fantasized a perception for something, but then come to find out that it was nothing compared to what you thought it actually was? An occurrence such as this exemplifies the manifestation of on e of the normal aspects of life. Sometimes in life, the perception of first appearances and certain things, contradict the terms of reality. This usually takes place when the forces of adversities that we encounter cause us to perceive unrealistic fantasies. Our ultimate control powered by the tools of imagination, fuel the inclination to perceive these things. This occurrence is clearly seen in â€Å" Araby†. In the short story â€Å"Araby† by James Joyce, the theme of the contradiction of perception by reality isShow MoreRelatedInfluences Of Disney Princesses1048 Words   |  5 Pagesby girls and often boys of all ages. The influence a Disney princess imposes on a child is based on how princesses are presented. The interest in a character, such as Cinderella, has mesmerized children as well as parents, but the perception of what is real and fantasy, creates a barrier for parents. 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