Airline Indutry - Asia Pacific Region - 8163 Words

1.Executive Summary Airline is a complex industry. It involves major capital requirements for aircraft, monitor by government regulations, restrictions and state policy, competitive reaction from other tourist transport and requiring high level of expertise to operate and manage. Airline facing increasing globalization, rising fuel prices, heavy repair maintenance cost, raising labor costs, increasing competition and requirements for higher service levels and greater flexibility. The acceptance of China to World Trade Organization and Beijing s winning bid for 2008 Olympics is expected to have a beneficial effect on airline industry to Hong Kong. However, loosening regulation of China s airline industry, additional flying†¦show more content†¦Part of this is related to the restrictive bilateral agreements, which also protect the home market. Some states have privatized their airlines and others intend to do so, a considerable number remain state-owned. As Forsyth observes, there is a strong correlation between per capita income levels and private ownership. In the richer countries in the region, such as Japan, Korea, Singapore, Taiwan, Malaysia, along with the colony of Hong Kong, all the airlines are privately owned. By contrast, there are few examples of private ownership of airlines in the poorer countries , while a number of governments have allowed the introduction of private airlines (e.g. Asiana in Korea, Dragonair in Hong Kong) to compete on international routes. 3.Asia Financial Crisis These are frenetic times time for aviation in Asia, although there are still problems leftover from the region s economic crisis which started in July 1997 and continued through 1998 for most markets. Whilst there has not been a full recovery to pre-crisis levels, Asia s economic is now showing recovery from the recession. The busiest international route in Asia is Hong-Taipei. In terms of international-only traffic, Hong Kong is listed as the largest airport in the