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Tables of Contents for Air Transportation
Chapter/Section Title
Page #
Page Count
Preface
xii
PART ONE AN INTRODUCTION TO AIR TRANSPORTATION
3
164
1 Aviation: An Overview
3
30
Introduction
4
1
The Aerospace Industry
4
20
Characteristics of the Industry
5
2
Economic Profile of the Industry
7
3
Industry Suppliers
10
1
The Government Market
11
2
The Civil Aviation Market
13
5
Factors Affecting Commercial Transport Sales
18
4
General Aviation
22
1
Related Products and Services
23
1
The Air Transportation Industry
24
6
Contribution to the Economy
25
3
Contribution to Efficient Conduct of Business
28
1
Impact on Personal and Pleasure Travel Patterns
29
1
Key Terms
30
1
Review Questions
30
1
Suggested Readings
31
2
2 Historical Perspective
33
60
Introduction
34
1
The Formative Period: 1918-1938
35
12
The Post Office Department Service
35
2
Contract Mail Service
37
3
Postmaster General Brown and the Airlines
40
3
The Turning Point for the Airline
43
3
The Arrival of the Professional Airline Manager
46
1
The Growth Years: 1938-1958
47
4
1938-1945
47
1
The Postwar Years
48
3
Maturity-Jets Arrive: 1958-1978
51
3
Economic Developments Prior to Deregulation
54
4
Federal Legislation and the Airlines
58
16
Early Federal Legislation
59
1
The Air Commerce Act of 1926
60
2
Additional Air Mail Acts
62
1
The Civil Aeronautics Act of 1938
63
2
Economic Functions of the CAB
65
2
The Federal Aviation Act of 1958
67
1
The Deregulation Movement
68
3
The Airline Deregulation Act of 1978
71
3
Postderegulation Evolution
74
6
Merger Mania
75
2
Regional Commuter Airlines
77
1
New-Generation Airlines
78
2
General Aviation
80
9
The Home of General Aviation
80
2
Mr. Piper and His Cubs
82
1
The Post-World War II Years
82
2
The Maturing of General Aviation
84
3
Business Aviation
87
2
Key Terms
89
1
Review Questions
89
2
Suggested Readings
91
2
3 Air Transportation: Regulators and Associations
93
34
Introduction
94
1
The Department of Transportation
95
7
The Federal Aviation Administration
97
1
The Federal Highway Administration
97
1
The Maritime Administration
98
1
The St. Lawrence Seaway Development Corporation
98
1
The Federal Transit Administration
99
1
The United States Coast Guard
100
1
The National Highway Traffic Safety Administration
100
1
The Federal Railroad Administration
101
1
The Research and Special Programs Administration
101
1
The Bureau of Transportation Statistics
101
1
The Federal Aviation Administration
102
9
Major Responsibilities
103
1
Other FAA Activities
110
1
The National Transportation Safety Board
111
5
Scope and Responsibilities
111
3
Steps Involved in a Major Accident Investigation
114
2
Major Aviation Associations
116
8
Airline-Related Associations
116
1
Other Airline Associations
117
2
Aircraft-Manufacturing Associations
119
2
General Aviation Associations
121
1
International Aviation Associations
122
2
Key Terms
124
1
Review Questions
124
1
Suggested Readings
125
2
4 The General Aviation Industry
127
40
Introduction
128
1
General Aviation Statistics
129
18
Factors Affecting General Aviation
131
4
Uses of Aircraft
135
8
Airports
143
2
FAA Services
145
2
The General Aviation Support Industry
147
7
The Manufacturers
147
1
The Aviation Service Industry
148
6
The Available Market-The Users
154
7
The Business Market
155
5
The Personal Market
160
1
Key Terms
161
1
Review Questions
162
1
Suggested Readings
163
4
PART TWO STRUCTURE AND ECONOMICS OF THE AIRLINES
167
58
5 The Airline Industry
167
30
Introduction
168
1
Structure of the Airline Industry
168
3
Growth and Regulation
168
3
Deregulation
171
1
Major and National Carriers
171
5
Regional Carriers
176
5
Early Growth
176
1
Role of the Regional Air Carrier
177
1
Code Sharing
178
2
Flight Equipment
180
1
Airline Statistics
181
1
Airline Certification
181
2
Section 401 Certificates
181
2
U.S. Air Carrier All-Cargo Certificates Under Section 418
183
1
Commuter Air Carrier Fitness Determinations Under Section 419
183
1
Data Collection by the DOT
183
1
Air Carrier Accounting and Guidance
184
1
Financial and Statistical Reporting
184
1
Industry Agreements
184
3
Identification Codes and Airline Designators
185
1
Publishing Schedules
185
1
Interline Agreements
186
1
Traffic and Financial Highlights: 1960-1996
187
7
Early 1960s
187
2
Late 1960s
189
1
Early 1970s
189
2
Late 1970s
191
1
Early 1980s
191
1
Late 1980s
192
1
Early 1990s
193
1
Late 1990s
194
1
Key Terms
194
1
Review Questions
194
1
Suggested Readings
195
2
6 Economic Characteristics of the Airlines
197
28
Introduction
198
1
The Airlines as Oligopolists
199
9
Number of Carriers and Market Share
199
1
High Barriers to Entry
200
2
Economies of Scale
202
1
Growth Through Merger
203
3
Mutual Dependence
206
1
Price Rigidity and Nonprice Competition
207
1
Other Unique Economic Characteristics
208
7
Government Financial Assistance
208
1
High Technological Turnover
209
1
High Labor and Fuel Expenses
210
1
The Competitive Advantage of Schedule Frequency
211
1
Excess Capacity and Low Marginal Costs
212
1
Sensitivity to Economic Fluctuations
213
1
Close Government Regulation
214
1
The Significance of Airline Passenger Load Factors
215
5
Traffic Peaks and Valleys
216
1
Capacity Versus Demand
216
3
Pricing in Relation to Load Factor
219
1
Key Terms
220
1
Review Questions
220
1
Suggested Readings
221
4
PART THREE MANAGERIAL ASPECTS OF AIRLINES
225
302
7 Airline Management and Organization
225
48
Introduction
226
1
Management
226
5
Levels of Management
226
3
Decision Making
229
2
Functions of Management
231
4
Planning
231
3
Organizing
234
1
Staffing
234
1
Directing
234
1
Controlling
235
1
Organization
235
3
Principles of Organization Planning
235
3
Line and Staff Responsibilities
238
1
The Organizational Chart
238
1
Staff Departments
239
5
Finance and Property
239
1
Information Services
240
2
Personnel
242
1
Medical
242
1
Legal
242
2
Corporate Communications
244
1
Economic Planning
244
1
Line Departments
244
24
Flight Operations
245
6
Engineering and Maintenance
251
10
Contract Maintenance
261
1
Marketing and Services
261
5
The Flight-Serving Passengers
266
2
Key Terms
268
1
Review Questions
269
1
Suggested Readings
270
3
8 Forecasting Methods
273
26
Introduction
274
1
The Purpose of Forecasting
274
2
Analysis
275
1
Planning
275
1
Control
275
1
Forecasting Methods
276
11
Causal Methods
276
3
Time-Series or Trend Analysis Methods
279
3
Smoothing the Variations
282
1
Accuracy of the Causal Models and Time-Series Forecasts
283
1
Judgmental Methods
284
3
Usefulness of Judgmental Methods
287
1
Key Terms
287
1
Review Questions
287
1
Suggested Readings
288
1
Appendix: Air Marketing Research
289
6
Appendix: TWA
295
4
9 Airline Passenger Marketing
299
26
Introduction
300
1
Development of the Marketing Concept
300
1
The Marketing Mix
301
7
Product
303
1
Price
304
1
Promotion
305
1
Place
306
2
The Consumer-Oriented Marketing Concept
308
6
Market Segmentation
309
2
Intensive Growth Strategies
311
3
Marketing Strategies Since Deregulation
314
7
Computerized Reservation Systems (CRSs)
315
1
Travel Agents
316
1
Frequent-Flier Programs
317
1
Business-Class Service
317
1
Code Sharing
318
1
Hub-and-Spoke Service
319
2
Advertising and Sales Promotion
321
1
Key Terms
321
1
Review Questions
322
1
Suggested Readings
323
2
10 Airline Pricing, Demand, and Output Determination
325
38
Introduction
326
1
The Trend in Domestic Passenger Air Fares
327
2
Pricing and Demand
329
9
Determinants of Demand
330
1
Changes in Demand
331
2
Elasticity of Demand
333
4
Determinants of Elasticity
337
1
No-Frills Air Fare and Survey Warfare
338
1
Types of Passenger Fares
339
1
The Pricing Process
340
7
Pricing Strategies and Objectives
341
1
Pricing Tactics
342
3
Pricing Analysis
345
1
The Role of Inventory Management
346
1
Airline Costs
347
5
Direct Operating Costs
347
2
Indirect Operating Costs
349
1
Nonoperating Costs and Revenues
350
1
Fixed Versus Variable Costs
351
1
Pricing and Output Determination
352
6
Total Costs in the Short Run
353
1
Load Factor
354
3
Profit Maximization in the Short Run
357
1
Key Terms
358
1
Review Questions
359
2
Suggested Readings
361
2
11 Air Cargo
363
28
Introduction
364
1
Historical Overview
364
7
Air Express
365
1
Overnight Air Express
366
2
Air Freight
368
1
The Arrival of Jumbo Jets
368
1
Types of Carriers
369
2
Air Cargo Today
371
3
The Future
374
1
The Market for Air Freight
375
2
Types of Air Freight Rates
377
5
General Commodity Rate
377
1
Specific Commodity Rates
378
1
Exception Rates
379
1
Joint Rates
379
1
Priority Reserved Air Freight
379
1
Speed Package Service
380
1
Container Rates
380
2
Special Air Freight Services
382
3
Assembly Services
382
1
Distribution Service
383
1
Pickup and Delivery Service
384
1
Other Specialized Services
384
1
The Air Cargo Guide
385
1
Factors Affecting Air Freight Rates
385
2
Costs of the Service
385
1
Volume of Traffic
385
1
Directionality
385
1
Characteristics of the Traffic
386
1
Value of the Service
386
1
Competition
387
1
Key Terms
387
1
Review Questions
387
1
Suggested Readings
388
3
12 Principles of Airline Scheduling
391
36
Introduction
392
1
The Mission of Scheduling
392
3
Equipment Maintenance
395
4
Flight Operations and Crew Scheduling
399
2
Ground Operations and Facility Limitations
401
4
Schedule Planning and Coordination
405
12
Traffic Flow
406
1
Schedule Salability
407
3
Schedule Adjustments
410
4
Load-Factor Leverage
414
2
Putting Together the September Schedule
416
1
Equipment Assignment and Types of Schedules
417
2
Hub-and-Spoke Scheduling
419
3
Advantages of Hub-and-Spoke Systems
420
2
Disadvantages of Hub-and-Spoke Systems
422
1
Data Limitations in Airline Scheduling
422
1
Key Terms
423
1
Review Questions
424
1
Suggested Readings
425
2
13 Fleet Planning: The Aircraft Selection Process
427
34
Introduction
428
1
Factors in Fleet Planning
428
10
The Prederegulation Era
428
1
The Hub-and-Spoke System
429
1
Technical Aspects
430
1
Fleet Rationalization
431
2
Fleet Commonality
433
1
Long-Range Aircraft
433
1
The Trend Toward Leasing
434
3
Noise Restrictions
437
1
Design and Development-The Manufacturer's Viewpoint
438
8
The Boeing Approach
438
3
Challenges from Airbus
441
4
Other Factors in Design and Development
445
1
The Fleet-Planning Process
446
6
Information Needed
446
2
The Fleet-Planning Model
448
1
System Constraints
448
1
Aircraft Evaluation
449
3
Tentative Fleet Plan and Financial Evaluation
452
1
Presentation and Management Approval
452
1
The Decision to Upgrade or Replace
452
2
Key Terms
454
1
Review Questions
454
1
Suggested Readings
455
1
Appendix: Fleet Planning at American Airlines
456
5
14 Airline Labor Relations
461
32
Introduction
462
1
The Railway Labor Act and the Airlines
463
6
The Origin and Provisions of the Labor Relations Act
463
3
The Collective Bargaining Process
466
2
Criticism of the Process
468
1
Historical Overview of Airline Union Activity
469
7
The Prejet Age
469
2
The Jet Age
471
4
Summary: Prederegulation Labor-Management Relations
475
1
Labor Relations Since Deregulation
476
13
Elimination of the Automatic Labor-Cost Pass-Through
478
1
A Period of Labor Unrest: The 1980s
478
5
The Consolidation Period: 1986 to the Present
483
4
Future Collective Bargaining Strategies
487
2
Key Terms
489
1
Review Questions
489
1
Suggested Readings
490
3
15 Airline Financing
493
34
Introduction
494
1
Sources of Funds
495
10
Internal Sources
495
1
External Sources
496
9
Sources and Uses of Funds by the U.S. Scheduled Airlines
505
14
Industry Balance Sheet
507
1
Sources and Uses of Funds: 1960-Present
507
8
Funding Sources in the 1990s and Beyond
515
2
Putting It All Together
517
2
Cash Management and Financial Planning
519
4
Cash Flow
520
1
Cash Budgeting
521
2
Key Terms
523
1
Review Questions
523
1
Suggested Readings
524
3
PART FOUR THE INTERNATIONAL SCENE
527
30
16 International Aviation
527
30
Introduction
528
1
The Question of Sovereignty in Airspace
528
3
The Paris Convention of 1919
529
2
The Havana Convention of 1928
531
1
International Air Law
531
8
The Warsaw Convention of 1929
532
1
The Chicago Conference of 1944
533
6
The Formation of the IATA
539
1
The Bermuda Agreement of 1946
539
2
Three Decades Later: From Bermuda to Deregulation
541
4
Challenges to the Established Order: The Early 1970s
541
3
New U.S. Policy in International Aviation: The Late 1970s
544
1
The Pursuit of Open Skies
545
5
The International Air Transportation Competition Act of 1979
545
1
The 1980s
546
3
Late 1990s Policy
549
1
Globalization
550
3
Future Challenges
553
1
Key Terms
554
1
Review Questions
554
1
Suggested Readings
555
2
Appendix A Career Planning in Aviation
557
20
Introduction
558
1
Choosing and Getting Your First Job in Aviation
558
7
Making a Self-Assessment
558
1
Examining Career Fields and Job Descriptions
559
4
Collecting Information
563
1
Finding Job Openings
563
2
Cover Letters and the Resume
565
2
Cover Letters
565
1
The Resume
565
2
The Interview
567
10
The Questions
567
1
After the Interview
568
9
Glossary
577
34
Index
611