Aviation Industry
Aviation Industry
Learning Objectives :
• History of the aviation industry
• Understand the commercial planes
configurations
• Define airline industry terminology
Aviation history
• By 1917, seventeen regularly operating
airlines in Europe, Africa, Australia, and
South America
• Some airlines from that era that are still
operating include: Royal Dutch Airlines
(KLM), SABENA World Airlines,
Lufthansa, and Qantas. Americans
viewed air travel as a dangerous sport,
not a safe means of transportation.
Aviation History
• By the 1920's governments started to form
national airlines through combining a few
private airlines. One such case is the
British government who formed Imperial
Airways.
Aviation Industry
•
described as building and flying aircraft.
Two sectors :a) Military :- aircraft flown by a nation’s air
force and other branches of its military
Aviation Industry
b) Civil :- divided into domestic service and
international service
i)
Domestic :- flight must start and end
within the borders of the same country
e.g. Malaysia, USA, India, Australia
ii) International :- flight starts in one country
and ends in another e.g. SIN-LAX
Airline growth
• Surplus of military planes left after World War I,
were converted to civilian use
• In 1919, bombers were being converted in
Europe to form over twenty small new airlines
• First regular international airline service was
started by one of those. The company setup by
Henry and Maurice Farman used old Farman
bombers to make weekly flights between Paris
and Brussels.
Airline Innovations
• Needed both larger, faster and safer
airplanes
• Many improvements were made, e.g.
cockpit instruments, altimeters, airspeed
indicators were installed in aircrafts in the
1930s that many believe it was the most
innovative period in aviation history
Airlines’ Regulatory Bodies
1)
2)
Federal Aviation Administration (FAA)
controls’ operations, licenses pilots,
inspects aircraft, and overseas
maintenance
International Air Transport Association
(IATA)
association made up of most of the
world’s airlines, sets standards for civil
aviation
Air Service and Routes
1)
2)
Scheduled service :- business or for
vacation travel operating regularly as
per fixed schedule, advertised times
regardless of number of passengers
Chartered service :- tour operator/s
chartered the whole plane or flight for
a round trip e.g. Singapore-TasmaniaSingapore
Air Service and Routes
3) Privately owned jet :- business travellers
(usually senior executives) fly on a corporate
jet that their company owns, e.g. Donald
Trump’s (Private Jet B727-23) owns NYC
Plaza hotel and Atlantic City’s Taj Mahal
Casino etc.
• Wholly or fractional ownership may be less
expensive than frequently buying first or
business class seats for their executives
Types of flights and journeys
1)
2)
3)
NonStop:- from origin to destination
with no intermediate stops
Direct :- flight from origin to destination
with one or more intermediate stops but
still on the same aircraft
Connection :- passengers must change
planes at the stopover city
Hubs and Spokes network
• Precise timing of arriving flights to offer a
seamless onward transfer to departing
flights and to maximise the number of
attainable connections for incoming
passengers and to keep at the same time
the connecting times within defined and
acceptable limits.
Aircraft
Two types of jet aircrafts :1) Narrow-body jet :- diameter of 3 to 4
metres, a single-aisle, seats arranged 4
to 6 seats, largest narrow-body jet
carries about 280 passengers
e.g. B727, B737, B757, A320
Aircraft
2)
Wide-body jet (jumbo jets) :- large
airliner with fuselage diameter of about
6 metres and twin aisles, accommodate
200 to 600 passengers
e.g. B747, B767, B777, A380
Configuration
1)
the way seating is arranged within the
aircraft, e.g. 3-4-3, 3-3
2)
normally, narrow-bodied jet with one
aisle, has two seats per row or 3-3
(common sight)
3)
wide-body jet, has two aisles and
normally comes with 3-4-3
Yield Management
• Also known as revenue management
• Average amount of revenue earned per
airline passenger divided by total number
of passengers miles flown
• Computer-assisted process that, by
assessing supply and demand, enables
airlines to arrive at pricing that yields
maximum load factors and revenue
Yield Management
• Equals profit
• Everything an airline does to make costs
and revenues break even
• Manipulate the variables to make as much
profit as possible
Budget Airline History
• Rollin King and Herb Kelleher developed the
original concept back in 1971; a ticketless airline
(Southwest Airlines) reducing frills and aiming
squarely at offering the lowest possible prices
• RyanAir through profit warnings and drifting
balance sheet, decided to follow the same
business model therefore, cutting the frills and
focusing on the functionality.
Budget Airlines
• The factors above contributed to the airlines'
relative successes, the most pivotal
development was EasyJet's (Switzerland)
pricing model
• market deregulation in 1997, the practices laid
down by these EasyJet and RyanAir (UK) were
adopted by many other budget operators both in
the UK, throughout Europe and the world.
Budget Airlines
• In SE Asia it started about 3 years ago
• Air Asia started in Malaysia followed by
many others, e.g. ValuAir, Tiger Airlines,
Jetstar, Phuket Airlines, Jet Airway and Air
Sahara, Adam Air etc.
Budget Airlines’ Definition
Generally, budget airlines practice the followings:•
•
•
•
•
•
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don't issue tickets
don't do connections
short check in times
promote and sell journey 'legs' separately
one class, budget
sell direct to the public
don't have free meals or entertainment
Codes and Jargon
• To promote efficiency and conciseness in
the transfer of information, the travel
industry has developed a system of
standardized codes
Code Sharing
• Allow one carrier to sell seats on another
carrier’s flights at a preagreed price e.g.
SQ and NW with a four-digit flight no.
• SQ relying on NW to reach out to US cities
• NW relying on SQ to reach out to Asia and
Australasia
City Codes
• IATA assigns and administers all the threeletter location identifiers used by the
airlines worldwide, e.g.,
• Bangkok
:- BKK
• Los Angeles :- LAX
• New York :- JFK
• Singapore :- SIN
Classes of Service
• First Class (P or F class)
• Business Class (J class)
• Economy Class (Y class)
Major Airlines with IATA call
codes
• Singapore Airlines (SQ)
• Malaysia Airlines (MH)
• Emirates Airlines (EK)
• Qantas/British Airways (QF/BA)
Major airlines with IATA call
codes
• Japan Airlines (JL)
• Thai Airways (TG)
• SilkAir (MI)
Computer Reservation System
(CRS)
• Major systems are called host systems
• Sellers of a computer system are called
vendors
• Travel businesses that lease access to a
system are called subscribers
Computer Reservation System
(CRS)
• Airlines that do not host a system but want
their information displayed are called
cohosts.
• Cohosts pay to have their information
displayed in the host’s computer system.
Some of the low-fare carriers have chosen
not to participate in the systems
Computer Reservation System
(CRS)
• Sabre (USA)
• Apollo/Galileo (UA/European Airlines)
Owned by Travelport which bought Apollo
and Worldspan)
• Worldspan (UK)
• Amadeus (Europe) founded by Air France,
Lufthansa, Iberia, and SAS
• Abacus (Singapore)
The Airline Reservation
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Flight itineraries
Effective/discontinued
Frequency codes
Minimum connecting times
Seat availability
Confirmation
Wait Lists
Methods of distribution
• Airports, city ticket offices (CTOs) and
telephone networks
• Travel agencies
• The Internet
• Post Office (Air Asia)
• SMS (Air Asia)
Commonly used terms
• Commercial flight :- seats sold by an
airline to the general public
• Gateway :- city and/or airport that serves
an airline as its departure/arrival point for
international travel
Commonly used terms
• Frequent-flyer programs (FFPs) :- initiated
by American Airlines in the late 1970s and
quickly copies by almost every airline,
frequent-flyer programs (FFPs) reward
their members for the number of miles
flown on an airline and its affiliates, e.g.
Krisflyer, Mileage Plus, World Perks,
Enrich, Royal Orchid Plus etc.
Summary
• The aviation industry has evolved from an
infant stage to a very competitive
environment with an emerging of budget
airlines.
• The different types of commercial planes
that are in the market and various
common terms that are used in the day-today running of the aviation industry.