- April 25, 2014
- Posted by: essay
- Category: Term paper writing
The aviation industry faces a number of opportunities related to slow travel. The slow travel is particularly beneficial for low cost companies because they do not need much financial resources from the part of companies. The low travel allows setting affordable price for customers. As a result, customers enjoy relatively low price of the slow travel. At this point, the slow travel is better compared to fast travel because the fast travel normally implies the high price as customers have to pay for the speed of the travel, while the slow travel, in contrast, admits the low price customers have to pay to aviation companies.
Furthermore, aviation companies save costs on travel and transportation due to slow travel. Aviation companies do not need to maintain the large staff to conduct the slow travel. In addition, they do not need the large fleet as well as aircrafts capacity can be lower compared to the fast travel. Smaller aircrafts need less fuel that allows aviation companies to save costs on the slow travel.
In addition, the slow travel allows aviation companies to increase the number of passengers. The slower is the travel, the larger is the number of passengers. Companies can use smaller aircrafts to transport passengers. Aircrafts are full and the number of passengers paying for each flight is high. As a result, the slow travel is highly productive and beneficial for aviation companies.
On the other hand, the aviation industry faces the problem of the low capital turnover because the low travel. In fact, the number of passengers increases due to the slow travel, but on the other hand, the number of flights decreases. As a result, aviation companies invest funds into flights but the return on investments is slow. For instance, if the fast travel includes ten flights per week, then the slow travel includes two-three flights per week. Therefore, if the company earns $10,000 per flight in the fast travel, then the company will earn $100,000 per week, while even if the company earns $20,000 per flight in the slow travel, its weekly earnings will be just $40,000 – $60,000 per week that is much lower compared to the fast travel.
The slow travel raises the problem of the decrease of the number of flights and companies operating in the aviation industry cannot increase the number of flights and increase sales. Therefore, the slow travel leads to the slowdown of the business development of aviation companies. In such a way, companies operating in the aviation industry cannot grow fast and expand their market share.
Companies operating in the aviation industry cannot raise the price. Otherwise, consumers will refuse from aviation travels. The slow travel discourages high price because the slow travel implies that passengers and clients will not pay for the time of the transportation or delivery. Instead, the slow travel forces companies to set low price that limits their earnings and profits.
In fact, the slow travel leads to the overall decline of travel that leads to slowing down the development of the aviation industry. Companies operating in the aviation industry cannot raise prices, they cannot expand their business fast, and they cannot increase the frequency of flights because costs will outweigh earnings of aviation companies.