ABSTRACT
Airlines operate in a dynamic and highly competitive business environment. This demands flexible approaches to conducting business that can rapidly adapt to sudden periods of economic downturn as well as exploit new market opportunities during times of economic prosperity. Airline operations are not only very capital and labour intensive (➤Chapters 11 and 18) but also vulnerable to external factors such as fuel price rises, increased competition, weakening of consumer demand and political unrest. Consequently, airline profitability is a major challenge and has been since the inauguration of regular commercial flights in the early 1920s. All airlines develop, operate and continually refine (and, in some cases, redefine) their business model in response to changing market conditions in order to remain operational.
