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Evaluate To What Extent Have The "No Frills" Airlines Coped Better In The Decline Of The Airline Industry Following The Events On September 11th

1709 words - 7 pages

Evaluate To what extent have the "no frills" airlines coped better in the decline of the airline industry following the events on September 11th and explain what could have led to their continued success.Introduction.The decline of the air industry was evident even before the events of September 11th. The global economic slowdown had left airlines suffering from excess capacity as passenger numbers, especially lucrative business travellers, dropped. In particular, the US downturn affected major airlines, such as British Airways, which generate a lot of their business from the transatlantic route.Method.The evidence I will bring together should enable me to see the extent to which the low cost airlines dealt better, what enabled to do so and the extent of their continued success. Primary and secondary research will be used to gather suitable information. Once this has been done I will examine to what extent have the "no frills" airlines coped better in the decline of the airline industryBackground.The attacks on September 11th resulted in a massive decline in passenger confidence in flying, which caused a huge fall in demand for airline seats as was pointed out by the media. By mid October 2001 more than 100,000 jobs had been lost in the industry worldwide and flight capacity had been reduced by 15 to 20 percent. For the large airlines, with huge outgoings that could not be reduced overnight and a drastic cut in revenue, which kicked in immediately.Airlines main assets are the planes it has. It's ability to either sell off these planes or to avoid the obligations to pay for them is negligible all it can do is to try and save on running costs by grounding them, however the trade off is that they bring in no revenue. This shows how the grounding of planes on September 12th would have caused problems for everyone having researched numerous Internet sites (see appendix for bibliography) it was clear that the low cost or "no frills" airlines such as Easyjet, Ryanair and Go dealt with the uncertainty better than other traditional carriers such as British Airways. It even seems that the events have led to an opportunity for these "no frills" carriers and they have been able to act on this and therefore increase there market shares.The changes that occurred within the industryThere were numerous changes that therefore meant the airlines had to deal with the change.*Following the slump in the aviation industry it was thought that tighter security measures being introduced would likely disrupt air traffic, hike costs and deter passengers. (BBC news). Industry experts said, "Some smaller airlines and airports would be forced out of business because of the cost of introducing these changes".*The US introduced new measures including strict screening, a ban of checking in baggage outside the airport, and a total ban on knives and scissors and even tighter measures followed, with America saying it would like to see as many airlines as possible to introduce...

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