The Business Travel Magazine March 2011
There are few industries more challenging than civil aviation. Fierce competition, overcapacity, low yields, volatile fuel prices and susceptibility to external events such as terrorism, ash and snow are all among the obstacles to success. The situation is not helped by some airlines growing too quickly, seduced by the vanity of volume, ahead of the sanity of profitability. This has forced the need for consolidation. In reality, the immediate drivers behind consolidation have been about survival, cutting costs and shareholder value. According to IATA, the industry lost over $50billion in the last decade with over 100 airlines going bust in Europe alone.