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Blue Sky Man

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Submitted By roseneal30
Words 4823
Pages 20
External Environment analysis
Summary
There have been turbulent times for the Australian airline industry. It has been confronted with the marked decline in international tourism in the aftermath of the September 2001 terrorist attacks in the US and, more recently traffic loss attributable to war in Iraq and severe acute respiratory syndrome (SARS) outbreaks in part of Asia and Canada. And off course, the global financial crises in 2008.
While the domestic airline industry is largely deregulated, Australia’s international airline industry remains quite deregulated at the commonwealth level, as it is subject to the detailed capacity controls of airline service agreements (ASAs) that underpin the industry. These agreements control the amount of airline seat capacity which may be deployed on scheduled services over individual country to country routes; they are general of treaty status and are enforceable in international law.
In another move to free up the international side of the industry, the Commonwealth adopted a policy of allowing more than one Australian owned international airline to operate scheduled services to and from Australia. However the September 2001 failure of the Ansett Airlines group brought an end to Ansett International's short-lived operations. Although Qantas is once again the only Australian flag carrier, Virgin Blue has signalled its interest in operating in some international markets in Australia's immediate region, such as the trans-Tasman market.
A significant trend that has started felt in Australia is the rapid emergence of low cost international carriers. Irish airline, Ryanair, is a high profile European example; Southwest airline is a long established American example.
Levels of competition vary widely within each sector. In the domestic trunk airline sector, the fairly robust competition that previously existed between Qantas,

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