Aviation Industry Information

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The airline industry provides transportation services for passengers as well as cargo through scheduled air routes. The aviation industry derives its revenues from regular ticket fees and freight charges. Other major components of the aviation sector include:

  • Air traffic control
     
  • Helicopter and private charter services
     
  • Airport management
     
  • Express delivery service

    History of the Airline Industry

    The pioneers of the airline industry, the Wright Brothers invented the first airplane in 1903. The first modern airliner, Boeing 247, was launched in 1933. It traveled at 155 miles per hour and had a capacity of ten passengers. Boeing 747 was launched by Pan Am in 1969. This highly sophisticated aircraft had four engines and a seating capacity of 450. The airline industry initially fell under the category of a public utility service, with government agencies establishing the air routes and prices. However, with the Airline Deregulation Act of 1978, the industry became market drive

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    Demand and Supply Drivers of the Airline Industry

    The demand drivers of the airline industry include:

    • Ticket prices
       
    • Passenger income levels
       
    • Access to and suitability of other modes of transportation
       
    • Frequency of services
       
    • Safety
       
    • Random factors such as terror threat

    The supply drivers of the aviation industry are:

    • Behavior of competition
       
    • Government regulation
       
    • Cost of resources (fuel, labor, maintenance, technology)


    Airline Industry: Major Players

    The European airline giants dominate the aviation industry. British Airways reported annual revenues of GBP8,593 million in 2008. Lufthansa reported annual revenues of Euro22.4 billion in 2007. Qantas, Australia’s largest airline, reported annual revenues of A$12.6 billion for 2007. The other major passenger airlines include Cathay Pacific, the Emirates, US Airways, Japan Airlines, Air France-KLM and Southwest Airlines. Cathay Pacific won the 2009 Airline of the Year title in the famous World Airline Awards, replacing Singapore Airlines as the 'world's best airline.' Among the freight carriers, FedEx is the world’s largest, with total revenues of US$ 37.953 billion in 2008.

    Some of the major airports across the world include:

    • London’s Heathrow Airport
       
    • Los Angeles International Airport
       
    • Frankfurt International Airport
       
    • Tokyo International Airport

    The global aviation sector generated revenues of $430 billion in 2007, with over 2,076 million passengers traveling by air. According to the US Bureau of Labor Statistics, the airline industry provided employment to around 487,000 people in 2006 in America alone.