Real Estate Market - Research Paper Example

Running Head: RECOMMENDATIONS TO US GOVERNMENT Recommendations to US Government of the of the Recommendations to US GovernmentIntroductionThe current scenario of US economy has greatly affected its airline industry and has caused great loss to the industry as a whole. With these difficult economic factors, it is important for US government to adjust to the changes. (Carlson. S and Paulson, 2010, 32) The airline industry as a whole is not currently operating in a way that will promise a successful and profitable future.

The key factors for a successful future of US airline industry in the domestic and global markets will include the following.Recommendations to US GovernmentIt is important to consider the reality, while the whole US airline industry is suffering; Southwest is beating the odds and prospering. The main aspect of Southwest’s advantage in the economy is their fuel hedging program. (Dunn, 2009 It is important for US government to take account of the fact. Since, this fiscal strategy allows airlines to protect themselves in opposition to rising oil prices by locking in a price for fuel.

While this strategy is a risky gamble, it has proven successful for Southwest and has saved the airline company $3.5 billion since 1998 over what it would have spent if it would have paid the industry’s average price for fuel. Reduction of fares will eventually minimize obstacles to efficiency of airlines in long run.Another recommendation for the US government is to appreciate Mergers of airlines. Mergers among competing airline corporations will bring profitable results. (Fishback, 2007, 415) By companies merging together, this allows them to cut costs by eliminating duplicate operating costs.

Through their success, Delta and Northwest have set the path for other airlines to follow. Mergers, such as that of Delta and Northwest, will eliminate duplicate routes from the two airlines departing from the same airport. By doing so, wage and fuel expenses will also decrease substantially. As airlines merge the competition in the industry will drop benefiting the entire industry. This will decrease buyer power, economic inequality between airlines and let the airlines set the prices they need to operate profitably.

Currently customers have a great deal of power within the airline industry due to the fact that each airline does not differ greatly from one another. (Yosef, 2005, 210) Therefore, price is ultimately the only factor that buyers will consider while choosing an airline. It is recommended to the US higher authorities, to make airline companies focus more on customer service in order to separate themselves from their competitors. This involves focusing both attention and finances into the human resources and marketing departments to create a loyal customer base.

By focusing more attention on aspects such as reward programs, in-flight services, and timeliness associated with arrivals, departures, and baggage claims customers will be more likely to book future flights with that airline company. Hence it will also help the economy to grow in long run.As technology continues to advance, many big airline companies feel they must conform by spending a great deal of money to include these advancements to satisfy customers. However, it is found that the low cost, low fare method practiced by Southwest is more profitable and practical in the current economy.

(Karnjanatawe, 2009) This method includes one class flights, no meals, and no in-flight movies or wireless. US Airways has recently started removing all in-flight movies and entertainment claiming it will save them $10 million annually. (CBSnews.com, 2008) By spending less for such type of luxuries, it becomes possible for airlines to provide a cheaper fare that is more attractive for the travelers. Hence, US government must make an effort and reduce costs in technological facilities in airline companies, which may also add to their profits and as a result they will get more popular amongst consumers.

ReferencesCarlson. S & Paulson. H (2010) ‘You, Me & The U.S. Economy: A Plainspoken Story of Financial Crisis’ Rosetta Books, pg 30-34CBS News (2008) ‘US airways to cut out movies’. Retrieved from http://www.cbsnews.com/stories/2008/07/10/national/main4247207.shtmlDunn, G. (2009, February). Fuel Hedging. In Flight global. Retrieved from Reed Business Information website: http://www.flightglobal.com/articles/2009/02/19/322650/fuel-hedging.htmlFishback. P. V (2007) ‘Government and the US Economy, A New History’, University of Chicago Press, pg 410-422 Karnjanatawe, Karnjana (2009, September 7).

Airlines trim down it spending. Retrieved from http://www.bangkokpost.com/travel/travelnews/19927/airlines-trim-down-it-spendingYosef. E. B (2005) ‘Evolution of US Airline Industry’ Theory, Strategy and Policy’ Springer, pg 200-210