Global Business: PESTEL Analysis of the UK Airline Industry

This report provides an overview of the UK airline industry, examining its global business environment and the changes it has undergone. It utilizes a PESTEL analysis to assess the political, economic, socio-cultural, technological, environmental, and legal factors impacting the industry in 2017. The report highlights key challenges such as political instability, economic downturns, terrorism concerns, technological advancements, environmental regulations, and legal compliance. It also discusses how organizations have adapted their strategies, focused on consumer relations, and addressed issues like air pollution and fuel costs by adhering to international standards and seeking tax exemptions. The report concludes by referencing relevant books, journals, and online resources to support its analysis.

Business

Table of Contents
INTRODUCTION...........................................................................................................................4
Overview of airline industry in UK............................................................................................4
REFERENCES................................................................................................................................6
.........................................................................................................................................................6

INTRODUCTION
Global business environment is a combination of three different words which involves
trade in the international market by taking into account nature and dynamics of global business.
The factors in different countries affect decision making regarding resource use and capabilities.
The is drawn into airline industry and covers changes that have occurred in such industry, drivers
responsible and the ways organizations responded to such forces (Maria, 2017).
Overview of airline industry in UK
UK's airline sector is a large one having enormity of airlines operating in global context.
It is the most active airline industries in the world and more than 151 million passengers
travelled through airlines operating in this area. Since, it is a globalised business there are
changes that have impacted organizations in this market. In order to understand the changes,
PESTEL has been conducted.
PESTEL analysis is a tool used for assessing and monitoring environmental factors
affecting an entity. Analysis has been conducted in the year 2017 which is mentioned below:
Political: The elections, riots etc. in many countries impact the business. These cause
hurdles which cannot be corrected until the situation becomes stable. The factors responsible are
the political stability and instability (Boshyk, ed., 2016).
Economic: The factors like financial crisis, global downturn, oil price spiked etc. are the
reason which decreased the sales on airlines by certain percentage. Furthermore, BREXIT has its
separate impact. Government's policies, plans, inflation and ease in carrying business are some of
the elements that changed the way airlines have been carrying their businesses.
Socio-cultural: The organizations have to make changes in their policies and procedures
along with budget in safety of customers due to increased encounter of terrorism attacks.
Continuous pressure from customers to meet the demand of safety.
Technological: The technology introduction such as internet has made it easy for airline
organizations to manage their business. Online bookings have enhanced the services and sales.
Utilising technologies that are reliable and eco-friendly.
Environmental: Due to greenhouse gases, pollution and other similar factors,
organizations have to incurred extra cost affecting the business (Hamilton, and Webster, 2018).

Customers have become aware and conscious about nature, hence, there is a regular demand to
meet environmental standards.
Legal: The higher tax rates on airlines by government which is recovered from customers
have raised the fares resulting in decline in customers (Peng, 2016). The enhanced non-
compliance level causes legal consequences which every organization wish to avoid.
There were serious issues which were and are still being faced by the entities operating in
airline industry. In order survive and sustain in long term, organizations have changed their
strategies, decision-making criteria and focused more on creating effective consumer relations.
For example, the level of air and noise pollution have increased due to expansion and added
flights. To reduce such issues, organizations have started complying with standards as provided
by International Civil Aviation Organization (ICAO) (Aviation pollution, 2019). Similarly, the
high fuel price was also a problem which has been managed properly as international flights
have been exempt from taxation.

REFERENCES
Books & Journals:
Boshyk, Y. ed., 2016. Business driven action learning: Global best practices. Springer.
Hamilton, L. and Webster, P., 2018. The international business environment. Oxford University
Press.
Maria, L.P., 2017. A Scenario Approach to the European Airline Industry: Impacts of Jet Fuel
Prices and Availability.
Peng, M.W., 2016. Global business. Cengage Learning.
Online:
Aviation pollution. 2019. [Online]. Available through: <https://www.environmental-
protection.org.uk/policy-areas/air-quality/air-pollution-and-transport/aviation-
pollution/>.