Pricing Challenges Facing Airline Industry
TIME @ “MMMM d, yyyy” October 6, 2018
Airline business has been on the rise over the years with increased profits than recorded before. However the industry is also faced with enormous challenges in its bid to provide quality services and still remain profitable. The challenges affecting the pricing in the industries are either natural disasters or human induced factors.
Change in climate is a natural challenges that has highly affected the industry. The sudden change in weather patterns has highly affected the business. During hurricanes and hailstones it becomes almost impossible for the industry to remain functional. This attributes to losses in the business. The insecurity of the sky in such climatic conditions makes it very hard to price the clients using the airline.
Secondly, the fuel factor. The upsurge of eroplanes has led to increased demand for fuel this has directly influenced in the increase in fuel prices and sometimes its scarcity. The prices keep changing which makes it very hard for the management in the airlines to set standard prices. The unstable pricing systems have led to increased losses on the airplanes firms across the globe. This challenge is a core issue in the airline industry.
Congestion, the increase in the number of fliers has led to an increase in the number of airplanes and hence increase in number of flights. This has led to air congestion as many airplanes are flying at the same time. This poses the safety challenge of the sky to the fliers and also the airports that may lack the ability to accommodate the large number of people and airplanes at their management. This increase leads to higher management prices that highly affects the pricing of the airlines.
Customer satisfaction is also another challenge. With the change of life the new generation population likes comfort and high standard of life. The airline are therefore required to provide these comforts of the passengers. This expectations are expensive to meet and maintain they therefore pose a challenge in the pricing of the airplanes. This is because the airplane management wants to meet the passenger expectations and still remain profitable and competitive in the business.
Technology is also a key factor in the industry. Despite the fact that the technological factor has increased the services of the airlines, with it has come many challenges to the industry. Technology is prone to failure and system collapse. This highly affects the functioning of the airlines. The buying and maintenance of the technological devices is very expensive. The dependence factor on technology also has posed a challenge on the airline business.
Terrorism since airline business mostly involves cross border movement. The air safety challenge across nations has also posed challenges to the airline industry. The different air space agreements across countries may also pose a challenge to the industry due to unsafety and even different taxation methods.
Pets among passengers have also posed a pricing challenge. This is because it is hard to price the different animals since they are of different sizes. The pet that fly have also be seen to cause emotional distress and sometimes panics in the flights. This hinders the passengers comfort. The death of the pets during flights also led many companies to be sued. This legal challenge leads to loss of money used in compensation.
How the article is related to the study of the course
The study is very key in this class due to several factors; one, it helps the student understand the weak points and strong points of the business hence is able to focus on research on how to improve on the same. The study is very vital as it open up the students’ scope on the various challenges facing the industry and how they can be minimized or curbed. The study is very key in the fact that it helps student, as scholars, realize the areas that need more academic research and recommendations that may influence policy making on the same. It helps the learner identify the existing gaps in the industry and how to invest in them.From the study is it is evident that despite the profitable nature of the airline business they are enormous challenges facing the industry. The challenges are mostly human induced in either their action or their political affiliation. However, nature has also posed challenges of climate that adversely affect the functioning and pricing of airline business.