Air transport research
Air transport is, as per the latest research and studies conducted, the fastest and reliable means of transportation available in the world today. It has always provided a better avenue through which trade between different states can take place. The air transport has proven to be one method that is efficient in the conduction of urgent businesses. It is due to such efficiency that it has been seen to attract a lot of business people. Cargo airlines, on the other hand, is the transport of goods in large quantities by the use of airplanes (Bazargan, 2016). Therefore, we can say that cargo carriers are companies or rather firms that are responsible for transiting trade goods with the use of planes. Some of the cargo airlines are part of the passenger airlines that are already existing. They are deemed with the responsibility of ensuring that trade is conducted in the most efficient way possible by providing punctual delivery of goods to the destiny where that they are needed at any given time. This paper seeks to have a review on the cargo airlines and with much interest, the Canadian airline market.
To begin with, it is worth noting that the Canadian airline market is one that is of the duopoly structure and this implies that it has two major firms dominating the industry (Sangster & Smith, 2016). The two firms that dominate the Canadian airline market are Air Canada and the Canada Airlines International Ltd. The two companies have a good time now been famous for the provision of cargo airline services to the people of Canada. The two firms are also famous for the provision of passenger airline services, but then they still get to dominate the airline industry. The two companies have been in the recent past seen to be offering stiff competition to each other, and this has been a major factor in contributing towards the efficiency in the services provided by each.
Airline market and the Canadian economy
Notably, the airline market has a significant impact on the Canadian economy according to researchers. One good instance that explains this well is the financial year 1991 when the cargo airline industry was seen to have had generated a whopping $7.6 billion in the form of operating revenues and still created a lot of employment opportunities for most of the Canadians (Sangster & Smith, 2016). That aside, the amount of cargo that was transported that year summed to a total of 640 million kilograms. This means a lot to the economy as it would have significant positive implications for the country regarding foreign exchange earned. Despite the fact that the huge or rather lucrative the two airline companies make from cargo transport, studies have proven that still, the passenger airlines provide more returns for the enterprise. In addition to that, the cargo airlines of Canada have been found to be accounting for only 2% of the entire cargo airlines in the world.
Certain features are seen to be popular in this industries, and they affect the industry big time. The market for the cargo airline is highly dependent on seasons. This implies that the market has times when its demand is high and a time when the demand is way too small. The peak seasons within a month occurs twice for the Canadian Airlines (Sangster & Smith, 2016). After that, the request for the services of the cargo carriers declines. In addition to that, though n a much different way, the demand for services from the cargo carriers flow with the general demand in the entire economy. When the demand in the whole economy is weak, then the same case applies to the industry whereas when the demand increases the industry hits it peak seasons. The industry has another characteristic which is so unique about it, and this is the high initial capital cost that is required for a firm to join the industry. The companies that occupy the industry sets the bars or rather standards for the same high to ensure that there is quality maintained in the kind of services that are offered. In addition to that, it is the high initial capital cost is the reason as to why the industry is seen to be generating huge returns.
Another characteristic feature of this industry is the cost structure which has been seen to be unique and makes it different from other sectors. The cost structure in this industry is predetermined by some factors and amongst them is the plane sizes (Sangster & Smith, 2016). The smaller planes are seen to be charging more than the larger ones. Another factor that affects the cost is the distance that is bound to be covered by the planes with the goods in transit. These among others constitute the characteristics of this industry.
Summarily, the Canadian air market is different from the ones offered in other countries because its market and cost structures have led to the growth or rather maintenance of the duopoly structure in the industry. The factors discussed in this text are what have contributed to the emergence of both a vertically and horizontally integrated structure through merging with the regional partners as well as the international air carriers. Indeed, the Canadian cargo airline is at its level thanks to the two firms that dominate it.
Bazargan, M. (2016).T Airline operations and scheduling. Routledge.
Sangster, J., & Smith, J. (2016). Beards and Bloomers: Flight Attendants, Grievances and Embodied Labour in the Canadian Airline Industry, 1960st1980s.T Gender, Work & Organization,T 23(2), 183-199.
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