Data Analysis: Airline Industry

Data Analysis: Airline Industry
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Data Analysis: Airline Industry
The Business Imperatives in The Airline Industry
The business imperatives in the airline industry are driven by increasing construction costs, decreased funding, increasing number of passengers, periodic downturns, and increasing customer expectations. Most airlines operate in a business environment with skinny margins and revenue. Consequently, revenue generation is one of the biggest imperative in the airline industry by delivering best-in-class passenger experience. However, in today's digital economy, revenue generation can only be increased by leveraging data, artificial intelligence (AI), and cloud computing to scale, adapt, and grow. The primary reason airlines must invest in these digital technologies is the enormous data generation capacities of next-generation aircraft (Weerasinghe & Ahangama, 2018). Many airlines are operating next-generation aircraft like Airbus A350 and Boeing 787, which come with enabled in-built data generation systems: these aircraft are not just contraptions capable of conveying people and cargo across continents but also huge data-generating computers.
Unlike legacy types, next-generation aircraft are prognostics powered, and their systems can try to troubleshoot when mechanical issues arise. Airlines can integrate this ability with adaptive aircraft maintenance to reduce time and costs. The immense data generation capacities of next-generation aircraft mean that airlines can analyze the information to implement incremental innovations towards higher revenues and lower costs. For instance, the data flows generated by these aircraft can be analyzed using AI and cloud computing to facilitate predictive maintenance fuel management and improve customer services (Eltoukhy et al., 2019). Another business imperative relates to the growing phenomenon of merging. Many airlines are consolidating into larger businesses to leverage the most revenues from the expanded size and scope. Mergers allow airlines to adapt their business models to match changing business climates and leverage new opportunities such as new routes or new pricing models that increase brand recognition and revenue generation.
Airline groups are choosing to retain the composite brands rather than consolidate them into one brand to capitalize on the benefits of scale and individual group members' brand awareness and loyalties. This strategy is especially effective when airline groups operate in several national markets. For instance, the International Airlines Group is a composite brand of four airlines: British Airways, Vueling, Aer Lingus, and Iberia. However, instead of merging all four airlines into one unstructured transnational brand, International Airlines Group has chosen to retain the brand names of group members. The airline group is now leveraging the cost advantages of economies of scale as one of the globe's largest airline conglomerates while enjoying the brand awareness and loyalties of the group's three national flag carriers (Price et al., 2019). Furthermore, airlines are now making strategic alliances in joint investments and processes like constructing new engine overhaul facilities to leverage the benefits of economies of scale without losing brand loyalties or affecting corporate sovereignty.
Another business imperative relates to inclusive hospitality. The growing number of disabled passengers who require additional accommodation when traveling is a significant business opportunity for airlines. Travelers are demanding more from airlines and want to engage only with brands that choose to anticipate their needs in advance or are trying to engage with them meaningfully. Engaging with vulnerable travelers about what the airline needs to meet their needs will improve the brand's market sizing and increase revenue growth (Dou, 2020). The other business imperative in airlines is sustainable travel. Passengers now demand that airlines embed sustainability in every aspect of their business by investing in sustainable aviation fuels, reducing single-use plastics, and promoting a net-zero supply chain. Airlines must now consider the climate impact of their activities and start investing in disruptive solutions that reduce their carbon footprint.
The Business Imperatives in The Maintenance Subsector
The business imperatives in the fleet maintenance subsector are driven by the rapid development of new technologies, tightening industry regulations, growing commercial pressure, and shortage of top talent. One of the biggest issues in aviation maintenance is the development of new technologies in repair and overhaul. The technological change in fleet maintenance will significantly alter how the industry works, with market analysts expecting severe reductions or redistributions of industry revenue (Yadav & Goriet, 2022). For instance, drones will soon replace workers to deliver spare parts and conduct aircraft inspections. Shortly, aircraft inspections will no longer be conducted visually by engineers. Drones, which take less time and resources to perform the same task, will now be us...