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Airlines
First Research, April 2012, Pages: 10
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Executive Summary
Brief Excerpt from Industry Overview Chapter:
The US airline industry includes about 600 companies with combined annual revenue of about $175 billion. Major companies include American (owned by AMR), Delta, and United Continental, as well as the air operations of express delivery companies such as FedEx and UPS. The industry is highly concentrated: the 10 largest companies account for more than 75 percent of industry revenue.
The worldwide airline industry generates about $500 billion annually. Major international companies include Air China, Deutsche Lufthansa, Air France-KLM, Japan Airlines, and British Airways.
Companies in this industry offer scheduled air transportation of passengers and cargo. Nonscheduled transportation is covered in the Charter & Other Nonscheduled Air Transportation Services industry profile.
COMPETITIVE LANDSCAPE
Airlines depend highly on the health of the economy, which affects air travel by business and consumer passengers. Because many costs are fixed, the profitability of individual companies is determined by efficient operations and on favorable fuel and labor costs. Small airlines can compete by serving local or regional routes.
PRODUCTS, OPERATIONS & TECHNOLOGY
Major services include domestic passenger transportation (about 70 percent of industry revenue) and international passenger transportation (20 percent); mail and freight transportation accounts for most of the remainder. Other revenue comes from providing maintenance, servicing, training, and reservations. Some airlines also offer nonscheduled (charter) flights. Some airlines carry only cargo, using specially equipped planes. Most passenger airlines also provide cargo services.
The basic operations of airlines include acquiring and maintaining airplanes and airport facilities, acquiring...
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