Political And Environmental Factors That Affect The Airline Industry

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9. Environments

Like any other Industry, the airline industry is also affected by changes in its external environment. King III (2009) highlights that leaders are not supposed to compromise the natural environment and the livelihood of future generations. Environmental Factors can also have a significant role to play in an airline industry; like in the case of Prof. McPherson we observe the bad weather reducing his time by 1 hour and thirty minutes. In light of the environmental factors that affect the airline industry this Study will focus on the traditional Political, Economic, Social, Technological, Environmental, and Legal Analysis, often referred to as the PESTEL Analysis. PESTEL analysis is a tool that is used to analyse an organisation’s macro-environment.

Political Environment
The incident of 9/11 has affected the airline industry adversely. The number of tourists to different countries has immensely decreased due to the fear of safety and security issues. On the other hand countries have put measures in place such as strict visa policies and border controls in an effort to combat terrorism attacks.
Economic Environment
Factors such as Crude oil prices, aircraft prices, Economies of Scale may also have effect on the airline industry.
Social Environment
Tourists and Business travellers contribute to the growth of the airline industry.
The use of modern technology by the airline manufacturers can contribute significantly to the growth of the

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