The External Environment In The Airline Industry

External Environment
Industry Analysis
The goal of the industry analysis is to recognize the external environmental factors which have potential impact on the industry. The first part gives an idea about the airline industry profile.
Airline industry, in the last decade, has been growing strongly at 7% per year for both through tourism and businesses divisions and is one of the most competitive, globally, contributing to economic growth, trade, investment and tourism.
Airline industry is affected by the economic growth, trade and political factors. The tense political situation like in the states Egypt, Cuba and the likes have affected tourism in the past and of course the most famous being on the 11th of September attacks which led to a drop

Thus, the power of the suppliers is high, since the suppliers have a grip on the market due to the huge demand of their manufactured products. Moreover, suppliers can affect the industry through their capacities to raise prices or reduce the quality of purchased goods and services.
Bargaining Power of Buyers
The buyers in the airline industry are demanding more and better quality services .The bargaining power of buyers in the industry is high due strong as low switching costs and plethora of options in the market.
Now, e-ticketing has improved the chance and flexibility to search for different airlines companies leading to down word cost pulls and upward services push. Furthermore, it eases of switching between different airlines companies. Therefore, for airlines they need to keep customers in the fold by providing air miles system to gain customers' attention and retain them.
Threat of a Substitute Products or Services
The threat of alternatives is comparatively low. However the how the service is used in different parts of the world is the driver of substitutes in the

Qatar Airways
Qatar Airways are its aggressive growth plan backed by the state that includes the construction and development of the new Doha international airport, which will include the world's largest aircrafts' hangers to be used for maintenance of Qatar Airways.
Singapore Airlines
Success factors of Singapore Airlines are: young and efficient fleets, educated staff, top ranked travel gateway and its low cost airlines known as "Tiger Airways", plus it's a membership of star alliance airline networks
American Airlines
Success factors of American Airlines are: largest airline in the world in terms of the total passengers transported, highest number of aircrafts, first to launch the loyalty program "frequent flyers".
PEST Analysis
Political factors
The airline industry is affected by political situations, namely wars and terrorism. For instance, terrorists' activities in different areas globally, namely USA (11th Sep), UK, Lebanon and Qatar made the regions unattractive for tourists and business travelers and reduce the passenger's