Before becoming captains, pilots must earn sufficient fly hours. However, flying schools do not have enough instructors to train enough new pilots. In response, the airline industries face increase labor costs as they raise pilot salaries in order to attract pilots. (3) Post 9/11 Aviation Security: after the 9/11 terrorist attacks, Congress passed the Aviation and Transportation Security Act (PDF), which created the Transportation Security Administration (TSA) and mandated that federal employees be in charge of airport security screening Jet Blue was a discount airline carrier. It offered passenger law fares; operated point to point system.
In 2008, fliers can expect to see fewer flights and fewer seats as airlines cut costs and reduce growth to counteract rising fuel prices. In essence, peak flying season is becoming a year-round affair. Bailey observes that, “Because full flights cause airlines all sorts of operational problems, travelers should also brace for continuing problems with delays and misplaced bags. That means the chance of being bumped from an oversold flight could be greater, and finding a seat on a later flight will take longer.” Paul S. Hudson, executive director of the Aviation Consumer Action Project said, “It’s not a good thing,” about airlines reducing capacity. “You’re going to degrade the reliability of the system.” Experts say it is
In JetBlue case, the current economy situation creates high market entry barriers, which consists extremely high fixed cost and numerous capital requirement. Moreover, the potential and existing competitors affect the industry has a low profit margin, and it is difficult for new entrances to differentiate their products and services from competitors. The bargaining power of supplier is high. The key inputs for the airline industry are the fuel and aircrafts. Boeing and Airbus dominate the aircraft manufacturing industry.
The SOX also calls for additional audits which increase business costs. If a business has increased costs and expenses due to the abidance of the SOX, it will most likely take money from other aspects of the business which can negatively impact the investors. The effectiveness of the SOX is debated by the advantages versus the disadvantages that companies and investors face. De Vay (2006) stated that, “The majority of the survey respondents feel that the benefits of
Loss of income for the company as a whole C. Which federal, state or local laws could be broken because of these legal issues/ why? 1. Issues with the Federal FAA for overlooking the safety of airplanes just to make a scheduled flight D. Recommendation to minimize possible litigation 1. To continue the talks with the company and union to come to a conclusion that will not only support the union but also benefit the company. II.
Fewer companies are willing to enter the market because of the SOX requirements that make going public too costly. Plus, the maintenance required to stay public is too expensive for smaller companies, forcing companies to look elsewhere to raise capital. Rising costs persuade large numbers of companies to exit the public markets to sidestep SEC regulation, creates two problems. First, the overall economy could suffer because corporations limit investment projects due to the higher-cost sources of capital to fund potentially new operations. Second, financially stressed companies that go dark are the very companies’ shareholders need to monitor usually and where transparency is most important.
If the CEO and Chief Financial Officer (CFO) would use the holistic marketing approach the airline would benefit with the change. Both the CEO and CFO are ignoring good marketing and customer relations. By ignoring both of these principals Classic Airlines revenue is suffering. With holistic marketing everything matters. If the CEO and CFO adopt this principal Classic Airlines will thrive in the future (Kotler & Keller,
This figure comes to $940,000 in a penalty fee that Hugo International will be required to pay. Another aspect that Hugo International needs to be aware of when eliminating healthcare coverage are the other financial decisions it would need to make. When the healthcare plan is eliminated and your employees will have to purchase coverage on their own, Hugo International will almost certainly be expected to raise the wages of your employees to enable them to be able to afford that coverage they seek out to have. The wage adjustment on top of the penalty could be more expensive than to continue
Should Britain expand its airports to meet the needs of a Globalised World? In a globalised world, cross-cultural travel has become an apparent trend amongst individuals from all over the world whether for business purposes or for leisure. However, if there is one certainty it is that airplanes have become the number one transportation option for many who wish to travel from country to country. Nevertheless, in this essay it will be argued that Britain should not expand it’s airports to meet the needs of a globalised world because of the destruction it would cause to the environment; only corporations benefit from it; Finally, Britain’s main priority should be it’s citizens. The aircraft option for travelling is one of the most popular forms of transportation available in Britain, with cheap holiday packages indulging many locals, as well as Heathrow Airport being a stopping ground for over 32.8 million overseas visitors in 2007.
Highly competitive industry 2. Unsuccessful implantation of growth strategy 3. The hiring of competent staff who maintain the culture of JetBlue JetBlue’s strategy of maintain customer excellence and providing needed low cost service is a definite way to stay up above the competition, customers want a low cost airline that gives them what they need in terms of pricing as well as destination. JetBlue, will be in a position of failure if a growth strategy is not in place to increase capital and foresee methods in which to cover debt and make a profit “ Achieving our growth strategy is critical in order for our business to achieve economies of scale and to sustain or increase our profitability” (JetBlue,2004) Gating is an important issue that must be looked at, due to the fact it could limit their sales “We will also need to obtain additional gates at some of our existing destinations. Any condition that would deny, limit or delay our access to airports we seek to serve in the future will constrain our ability to grow” (JetBlue, 2004).