Question

Explain the domestic air transportation industry—regulation era, deregulation era, the impact of airline deregulation on air carriers, general aviation, and airports.

Answer 1

Regulations era witnessed excessive competition and probably predatory pricing due to perfect competitive structure which led to plunged profitability, excessive customer switching, expansion of newer routes, dynamoc pricing which all led to stringent regulations to preserve health of sector and consumer interest as well. This also led to strict protocols for consumer at airports and general aviation safety was largely regulated to meet safety international standards and prevent hazards.

The deregulation era was largely implemented to bring free entry in to market, commercialization ofnew servies, optimization of fares and redundancy in routes, bring bottim rates in airline sector, promote employment opportunities and growth in global economy. Also freeing up passengers Airlines and decongestion of existing airports were prime objectives.