Looking at the Future Airline Industry

Jan. 19, 2006
The airline business, to say the least, is a study in contrasts. Recent reports from Boeing and Airbus would have an observer think, considering the record aircraft orders being placed, that the airline business is booming. Add FAA's projections for passenger forecasts and the rose is in full bloom. Except that the petals - the air carriers - seem to fall off the flower faster than it can reproduce. Delta, Northwest, and United remain in bankruptcy protection; overall, the airline industry loses money regularly. It would seem a non-sequitur. The Wall Street Journal took the DOT Secretary to task this week for "musing on the possibility" of a merger of Delta and Northwest; this at a time when DOT appears opposed to a full merger of the Skyteam alliance. The Journal would like to see fewer market constraints and clearer direction from DOT. Seems fair. It also seems fair that a new global market is upon us, and it calls for new rules for the game. One start may be in changing the laws as they relate to foreign ownership of carriers; the next, which the U.S. has actively been pursuing, is open skies. To paraphrase Monty Python, the time has come for something completely different. Thanks for reading.