PESTEL analysis on European airline industry.docVIP

PESTEL analysis on European airline industry PESTEL analysis is an updated version of “ETPS”, a mnemonic for the four sectors of his taxonomy of the environment: Economic, Technical, Political, and Social (Aguilar, 1967). PESTEL analysis is an analysis of the external macro environment (big picture) in which a business operates. These are often factors which are beyond the control or influence of a business. Airline industry is one of the most important transportation sectors for an area’s progress which makes crucial contribution on an economic, political and social, cultural level (Button, 2008). In the following part, this essay will target the Europe airline industry analyzing the political, economic, social, technological, environmental and legal aspects of the European airline industry. In the political aspect of European airline industry, EU has liberalized the aviation market of two decades. EU adopted the first directive in 1983 so as to liberalize some inter-regional services. The second directive was adopted in 1994. In the second directive made most of the European market opened up. From then on, airlines registered in the EU and controlled by EU nationals had the right of establishment throughout the EU and were free to fly within and between all member states (Starkie, 2012). For example the biggest low-cost airline company Ryanair has the bases all over the European countries (list below). Ryanair Bases January 2010. Source Airline Business, January 2010. Along with the liberalized process of the European airline industry, EU politicians also focus the development of the full-service airline companies in order to satisfied multiple demand of the airline passengers. With the increasing growth of LCCs, the FSCs have changed their business policies (European Cockpit Association, 2006) and have been forced to implement reforms (pricing structures, cost-cutting, changes to on-board services, etc.) to increase the competitivity. In the economic