ABSTRACT
Commercial aviation has undergone enormous growth over the last few decades as the globalization of industry and commerce has matured, while at the same time air travel’s relative affordability has allowed it to become an integral part of many people’s lifestyles. With just a few hundred metres of runway, even the most remote corner of the planet has the potential to be integrated into the global economy. Yet the industry remains in a financially distressed state returning only marginal profitability down through the decades which can be directly attributed to its high fixed cost structure, overleveraged balance sheets, low barriers to entry, high barriers to exit, fragmentation, militant unions, cyclical macroeconomics, fluctuating fuel prices, a unique regulatory environment, and monopolistic/ oligopolistic suppliers – which are just a small sample of the varying dynamics that reside when managing airlines.
