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PEST Analysis of the European Low Cost Airlines Industry - Research Paper Example

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The author of the following research paper "PEST analysis of the European Low-Cost Airlines Industry" underlines that the European airline's industry has seen a tough time in the recent recession. Despite this, Ryanair has been able to fetch profit for the period…
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PEST Analysis of the European Low Cost Airlines Industry
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Download file to see previous pages An ongoing focus on the cost reduction and operating efficiencies are of much significance in the Ryanair’s way of accomplishing activities. However, there have been certain issues which Ryanair has to face regarding operation through the secondary airports. Still, the organization has been able to mark its sign and move to the leading position through proper cost reduction and fuel hedging. In the future, the company would need to connect more destinations, mainly the prospective unexplored ones. To maintain cost effectiveness while attaining a sustainable growth are the main two issues which must be taken care by Ryanair to shape up its strategies.
“At a time when the traditional major airlines have struggled to remain viable, the low-cost carriers have become the major success story of the European airline industry” (University of Connecticut, 2010).
The whole airline industry had seen a troubled time in 2002. The blame was all put to the shock of 11 September 2001. Even before that also, the whole industry figures had been deteriorating due to the decline in the passenger growth rates and overcapacity, leading to declining yields and margins. However, these events have flaunted the difference between mainstream airlines and the low-cost ones. The budget airlines continued to capture a rising share of the aviation market. More precisely, the budget airline operators are the only one to fetch profit in the troubled times. The following factors are supposed to put an impact on the European low-cost airline's industry and hence must be taken into account.
Back in 2003, the European Parliament has decided to force the low-cost airline's industry to pay £250 for each traveler for any overbooked or canceled flight (Mayer, 2007). ...Download file to see next pagesRead More
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