Aviation Question: The Airline Industry is a Great Paradox (Essay Sample)

Question 1
Airline yield is basically the amount paid by a passenger per a mile travelled using the airline. It is calculated by dividing the overall passenger revenue collected by the number of passenger miles. It is often calculated during the estimation or measure of the charges upon each passenger or customer per mile. Airline yield is basically meant to do the overall analysis and assessment of airline fares over a specified time period. The current trend in the airline industry is characterized by low profit margins and low shareholders returns. This has prompted the airline industry to embark on laying down strategies to cut the overall cost in a bind to streamline revenue growth and consequently increase its profit margins. In spite of those challenge the airline industry has continued to record consistent growth over the past few decades. Much of this growth can be attributed to low cost and at times reduced oil prices that work to the advantage of the airline.
Question 2
There is great difference between load factors and high yield factors.Load factor involves measures that maximize utilization of public facilities and especially public transport in this context. The load function is calculated by dividing the average weight by the maximum amount of the load at a given time period. On the other hand, high yield factor in reference to transport refers to a situation where the demand that is experienced is high than the supply in the said market. Example if in an airplane is supposed to carry a maximum of fifty passengers but due to demand, it is forced to carry more or take extra trips, then that is high yield factor. The maximum weight of goods that a cargo plane can carry is its load factor.
Question 3
The airline industry is a great paradox in the sense that the industry is bound to face many challenges but at the same time it attracts new entrants that find the business very viable. The industry involve high capital intensive and it happens to be very prone to fluctuations in the oil prices and many economic cycles yet at the end of the day the industry is sustainable. This is a paradox in the sense that many analyst would expect and anticipate the collapse of the airline industry while the opposite end up happening, the industry is sustainable.
Question 4
Types of organizations within the air transport value chain include the following; southwest airlines value chain, American airlin...