The airline industry has suffered through a tough and unforgiving decade. From the economic effects arising from the ' to the current global recession to the swine flu, the downtrodden industry has taken a huge hit in virtually every front: global terrorism on American soil, global economic recessionand a global swine flu pandemic.
To boost the fledging industry, the federal government provided an aid package of $10 billion in loan guarantees and $ 5 billion in short term assistance[i].
By 2006, the airline industry was just beginning to recover when it was hit again by another devastating volley. This time the global economic tsunami that started in late 2007 swept the airline industry putting a sharp halt to airline ticket sales.
With the worldwide recession hitting people’s pocketbooks, less people had the disposable income to fly leisurely. In addition, with the advance in technology and the speed of telecommunications, many companies began to discern the greater economic value of teleconferencing from their desktops over conducting face-to-face meetings. Moreover, the higher oil prices coupled with falling demand rocked the airline industry. In a sense, we had the makings of the perfect economic storm which severely affected the industry’s bottom line with a revenue downturn larger than that of 9/11[ii].
Surpisingly, despite the large financial market and auto bailouts that the federal government provided over the last year, the airline industry has yet to ask for a huge infusion of cash.
#1 Miracle on the Hudson
The most viewed aviation news story in the US in 2009 is luckily the most good news human interest story in this industry as far back as we can remember. CAPT Sully Sullenberger’s heroic actions and poise during the historic water landing into the frigid Hudson River created the most revered aviation icon since Amelia Earhart tried to fly around the world in 1937 becoming a champion for women’s causes and a hero for all Americans who aspire to change the world.
Immediately after the plane had been ditched into the river. All 150 passengers exited the plane via its wings or from an inflated slide deployed from the front from the right side passenger door. After twice walking the length of the cabin to confirm that no one remained inside, CAPT Sully Sullenberger was the last person to exit the aircraft.
#2 Colgan Air Tragedy
Less than a month after the “Miracle on the Hudson”, Colgan Air Flight 3407 marked as the Continental Connection experienced the second year-to-date aviation accident in the state of New York. The commuter plane experienced significant ice buildup on the aircraft’s wings and windscreen shortly before the crash. The National Transportation Safety Board (NTSB) investigation showed that the pilot had failed numerous tests during his career suggesting that he may not have been adequately trained to respond to the emergency that led to the aircraft’s fatal descent. Crew fatigue was also a grave concern since both pilots spent the previous day and night at the Newark airport prior to the 9:18 pm departure[i].
(Photo from Jetphoto.net)
Although the investigators focused on training, qualification and pilot fatigue, the media, the American public and Congress honed in on the shocking detail that Colgan Air pilots as well as many other regional aircrew face long commutes, low pay and second jobs. The analogy that resonated well with the public was the revealing comparison between a bus driver and a pilot: “Most people would be shocked to hear that the train or bus operator who ferries passengers to the airport makes a lot more money than the pilot who is responsible for all the lives onboard.” (Although true, this information can be misleading. Pilot pay per hour is higher than bus and train operators. The distinction is that bus and train operators can work overtime, while commercial air transport pilots are limited to 100 hours of lying in a month).
While the airline industry has come under scrutiny in the field of customer satisfaction, the sentiment and respect the American people have for pilots have for the most part remained unscathed. That is why the story of how two pilots overflew their Minnesota airport destination by 150 miles is almost unbelievable. Normally a story that did not have a tragic ending would not garner significant news interest during a busy news season. However, because the pilots denied falling asleep on the job and admitted doing personal work on their laptops, this questionable statement increased the sensationalism and shock value of this bizarre story. It is incomprehensible for many Americans even those who don’t know the slightest thing about aircraft handling to see how the pilots could over fly their destination by such a large degree. Since the Federal Aviation Administration (FAA) has revoked the license of both pilots, the Airlines Pilot Association (ALPA) has assumed the critical role in providing legal assistance and representation of the two pilots in any legal or administrative courts. However, due to the tremendous media interest, ALPA should also consider representing the pilots in the court of public opinion since this could have more impactful repercussions in the airline industry and flight safety overall.
#4 Swine and Airline
Another challenge to the airline industry was the spread of the swine flu. In late April 2009, when the first cases of H1N1 were reported in the United States, the World Health Organization declared a "public health emergency of international concern". Combined with the detrimental effects of the recession on ticket sales, the swine flu spelled deep trouble for the airlines.
The airline industry is very vulnerable to the spread of the swine flu and other bacterial-related communicable diseases which can be spread between humans by coughing, sneezing or by touching. The swine flu is most contagious during the first five days of the illness while children can be contagious for up to ten days[iii].
The swine flu could not have happened at a worse time for this industry. Sadly, more than any other sector, the airline industry was hit hardest by the H1N1 pandemic.
With the exception of Mexicana and other Mexico-based airlines, the US airline industry was impacted the most since the World Health Organization severely restricted travel to Mexico. Every U.S. network carrier flies to Mexico. Some airlines like Continental fly an average of 450 flights a week to Mexico.[iv]
Swine flu originated in the rural villages of Mexico and spread briskly throughout all parts of the world, through the freedom and free limits of air travel. Many customers who didn’t want to risk getting sick or getting inconvenienced, simply cancelled their flights to and from countries of concern. Meanwhile, the airlines had to waive change fees for passengers flying through Mexico and provided many refunds for those whose plans were turned around. The airlines industry faced a difficult time adsorbing lost revenue something that took many close to their breaking point. Since another outbreak of swine flu or other communicable diseases are distinct possibilities in the near future, the airline industry must be ready to incur and respond to more damages.
#5 Airlines Leveraging Social Media
Consumers have been using social media like My Space since the proliferation of Web 2.0 around the middle of this decade. Many customers found social media an effective tool to vent their annoyances and share their challenges and lessons learned with air travel. Seeing the enormous potential and instantaneous reach of social media, several airlines over the last year have began a massive campaign launching their own brand footprint into this previously-unchartered territory. These new media sites help airlines market their brand while interacting with customers simultaneously and at the same level. industries have an incentive to fill every seat on a flight. Not only does a full plane increase ticket sales, it gives the impression to flyers that their seats are in high demand. When there are last minute empty seats on a plane, some airline companies advertise these as hot deals on their Twitter page--filling otherwise empty seats while building customer loyalty.
Imagine if Twitter was invented prior to 9/11. If the passengers of the doomed United Flight 93 could tweet to the rest of the world that they had just been hijacked, that information could be critical and valuable for both rescue, remembrance and litigation.
[i] Makinen, Gail (Sept 27m 2002). "The Economic Effects of 9/11: A Retrospective Assessment", Congressional Research Service. pp. CRS-4
[ii] Mutzabaugh, Ben, “Airline Outlook Worsens; Impact of Crisis Larger than 9/11”, Sept 16, 2009
[iii] Polek, Gregory, “NTSB scrutinizes Pilot Actions in Q400 Crash Probe” Aviation International News, May 12, 2009.
[iv] Grossman, David, “Regional Airlines Thrive while the Big Boys Cut Back”, USA Today, Nov 3, 2009
[vi] Graves, Robert, “U.S. Carriers Cutting Service to Mexico”, MSNBC, May 1, 2009
[vii] Warren, Christina, “Analysis: Which Airlines do Twitter Users Prefer,” Mashable, the Social Media Guide, Oct 1, 2009
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