I. Why should firms in the airline industry pay more attention tomacro-economic business...

Question

I. Why should firms in the airline industry pay more attention tomacro-economic
usiness environments? (Use either U.S. airline ca
iers and/ or companies from
any other country to answer this quest)
Airline industry is vast, complex and dynamic in nature. Macroeconomic factors largely affect
the business operation of the industry both directly and indirectly. Macroeconomic business
environment refers to the external factors that are not under the control of the company. Several
macroeconomic factors like the economic health of the nation, business cycle, exchange rate,
global political stability, government policies on environmental regulation have vast influence on
the business operations of airline firms. Air travel, both business and leisure travels, expands
when the economy is in boom. On the contrary, the industry has seen a sharp fall in demand
when the economy enters into recession. For example, US air ca
iers were hardly hit during the
period of recent economic crisis. Five among nine major air ca
iers in US have posted a total
loss of $4 billion approximately (Winship, 2010).Delta, American, and United – three largest
mainline ca
iers have experienced huge financial woes during the period of economic
meltdown. Hence, macroeconomic business environmental factors, though not under the control
of air ca
iers companies, have significant influence on their business operations.
2. One of the principal functions of any business firm is to define consumer wants/ needs.
As a...

David · Accepted Answer

I. Why should firms in the airline industry pay more attention tomacro-economic 
business environments? (Use either U.S. airline carriers and/ or companies from 
any other country to answer this quest) 
Airline industry is vast, complex and dynamic in nature.  Macroeconomic factors largely affect 
the business operation of the industry both directly and indirectly. Macroeconomic business 
environment refers to the external factors that are not under the control of the company. Several 
macroeconomic factors like the economic health of the nation, business cycle, exchange rate, 
global political stability, government policies on environmental regulation have vast influence on 
the business operations of airline firms.  Air travel, both business and leisure travels, expands 
when the economy is in boom. On the contrary, the industry has seen a sharp fall in demand 
when the economy enters into recession. For example, US air carriers were hardly hit during the 
period of recent economic crisis. Five among nine major air carriers in US have posted a total 
loss of $4 billion approximately (Winship, 2010).Delta, American, and United – three largest 
mainline carriers have experienced huge financial woes during the period of economic 
meltdown. Hence, macroeconomic business environmental factors, though not under the control 
of air carriers companies, have significant influence on their business operations.
2. One of the principal functions of any business firm is to define consumer wants/ needs.

I. Why should firms in the airline industry pay more attention tomacro-economic business environments? (Use either U.S. airline carriers and/ or companies from any other country to answer this quest)...

Solution

Answer To This Question Is Available To Download

Related Questions & Answers

Submit New Assignment