ABSTRACT
In addition to the continuing crisis it faces, the airline industry has also to face up to a dichotomy. It is forecast that the world economy will remain moderately stable and healthy in the near future, despite a slowdown in economic growth. In the short term, inflation may hold steady and inflation rates will probably decrease gradually. Happily, over the past decade, commercial air carriers have broken the shackles of rigid regulation to form strategic alliances among themselves. In its contemporary business garb, franchising has permeated a wide spectrum of businesses, introducing a sophisticated business relationship between two parties, thereby creating a contractual relationship. Competition in global air transport presents unique strategic issues. Global industries, such as multinational air carrier alliances, are characterized by the presence of competitors operating worldwide from home bases in different countries. Competition in air transport industry is complex process, as there is no consensus among airline economists as to the exact nature of the industry.
