Macro and Micro Environment Analysis of the Airline Industry

Running head: HOSPITALITY AND TOURISM MANAGEMENT
Hospitality and
Tourism
Management
5/5/2019

HOSPITALITY AND TOURISM MANAGEMENT 1
Table of Contents
Introduction................................................................................................................................2
Macro environment analysis..................................................................................................2
PESTLE analysis................................................................................................................2
Micro Environment Analysis.................................................................................................3
Porter Five Force Framework............................................................................................3
Swot Analysis.........................................................................................................................4
Strength..............................................................................................................................4
Weaknesses........................................................................................................................5
Opportunities......................................................................................................................5
Threats................................................................................................................................5
Conclusion..................................................................................................................................5
References..................................................................................................................................7

HOSPITALITY AND TOURISM MANAGEMENT 2
Introduction
The aim of this report is to present the Macro-environment analysis, Micro-environment
analysis, and SWOT analysis of the Airline industry, by analysing the available case study
regarding the Strategic Alliance in the Airline Industry.
Macro environment analysis
PESTLE analysis
Political Factors – The political environment in which the companies of airline operate are
extremely controlled and favours the customers or passengers over the airlines. It is because
the global industries of the airline in the environment where the safety of the passengers is
vital and where the propensities towards monopolistic behaviour by the airline businesses
have resulted in the political establishment exhausted and therefore, they have to shift to the
strict rules and regulations for the airline operators (Shaw, 2016).
Economic Factors – The economic forces have a major influence on the industry of airline.
In fact, the recent economic downturn has resulted in experiencing the lowest period of the
industry. There was a decline in premium and economy traveling. Furthermore, airline
operators were dealing with high pressure in managing the increasing prices of fuel. In order
to manage the economic losses, a number of airlines have involved in strategic alliance, for
example, Sky Team Alliance, One World Alliance, and Star Alliance. However, some of the
airlines like Emirates have avoided getting involved in a strategic alliance and developed its
own strategies (Common Wealth of Australia, 2019).
Social Factors - Airline business also gets involved in creating social values, the same as
other businesses because consumers in today's market have changed a lot. To fulfil the
altering demands of the customer, companies of airline need to integrate changes into their