External Environment Of The Airline Industry (Essay Sample)

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Business Environment Analysis
Most people associate airplanes with luxury and flourishing businesses due to their ability to offer comfort and travel convenience. However, most airlines, such as TransGlobal Airlines, struggle to remain profitable beneath the veneer due to the ever-increasing cost of operation and other external factors affecting the financial performance and business merger strategies may be internal or internal internal-external environment. The PESTEL analysis is crucial in establishing the external factors influencing an organization's financial performance and decision-making. The decisions may include acquisition, merger, leasing, and expansion. The external factors analyzed by PESTEL include political, economic, social, technological, environmental, and legal environments.
Political Environment.
Governments globally highly regulate the aviation industry due to the potential risk involved with air transport. Airlines are prime targets for terrorists, they lead to many deaths in case of accidents, and their accidents may lead to irreparable damages to infrastructure or the planes. It is prudent for airlines to factor in the political aspect when laying out their strategies for acquisitions (Nguyen et al., 2020). Acquiring a company with no track record abiding by security protocols would negatively jeopardize the acquiring company's operations. Loss of customers and damage to reputation may follow.
Economic Factors.