Published Articles
Airline Innovation: How FSCs Challenge LCCs with New Products
Air travel is a commodity. For most travelers, price is king, and fare competition is fierce. Over the years, the vicious circle of price wars has left a trail of airline casualties. Surprisingly, many other industries manage to thrive in a commoditized environment, and airlines can learn from them.
Commoditization occurs when the market perceives products to be substitutable. When products are substitutable, customers will naturally purchase the cheapest, and businesses will fight to lower their costs. It is common for economic textbooks to use the evolution of the American airline market after deregulation to introduce commoditization.
This is How Migration is Reshaping Air Transport
Millions of people are fleeing conflict in Syria, Iraq, Afghanistan and Ukraine, as well as persecution in areas of Southeast Asia and Sub-Saharan Africa. Why are people fleeing? Where are they going? How are host countries responding?Fleeing war-torn lands in search of safer, better lives, people have been leaving their native countries. A total of 9.6 million migrants fled the Middle East as of the end of 2015, up from 4.2 million in 2005 – a nearly 130% increase. This increase in emigration waves has been fuelled by arising conflicts mainly in Iraq, Syria, Yemen and Afghanistan creating the highest level of displacement since World War II. Worldwide migration pressures are expected to increase with the rise of war zones and demographic and economic differences between developed and developing countries. These waves of humanity will shape the future character of host countries.
Thailand Aviation: What Happened to It?
In our growth markets series, we covered China, Turkey, Australia, Indonesiaand South East Asia Aviation. Today, we take a look at Thailand.Last year, Thai Airways announced it was axing the Bangkok-Los Angeles route, in a move that put an end to 35 years of service to the US. Rome and LAX were two loss-making routes reported to be costing the airline $3 million a year. After a net loss of $445 million in 2014, Thai Airways’ debt skyrocketed to $5.9 billion, the highest among Southeast Asian airlines.
Once admired for its dream of competing with the likes of Singapore to become Southeast Asia’s global hub, Thailand has seen things changing fast. From the delivery of its flag carrier’s first A380 to the red stamp received by ICAO last year, Thailand seems to have lost its edge. Or has it? After all, Thailand’s airports have doubled traffic in six years, and carriers are ramping up with aggressive plans for expansion.
South East Asia Aviation: What You Need to Know
“The liberalization of ASEAN’s aviation sector will be a major catalyst for the region’s economic growth by 2030” - Liow Tiong Lai, Malaysian Minister of Transport
The Malaysian Minister of Transport’s thoughts are backed by strong arguments as aviation plays a vital role in developing business, trade, sales, innovation, investments and tourism, all facilitating economic growth. With South East Asia being one of the most dynamic areas in the world, a boost in tourism and trade should have astonishing effects and bring countless opportunities - and challenges - for all aviation players. Latest news indicate that the Single Aviation Market (SAM) is due to be signed by this year.