From ArticleWorld

There are numerous airline companies currently in operation around the world. The number of individual airlines is constantly changing due to smaller airlines being acquired by larger operators, and some being forced into liquidation by the uncertain economic climate. Terrorism has also been responsible for a number of airlines losing revenue. The American airline Pan Am, struggled after its flight 103 exploded over Lockerbie, Scotland in 1988, and was forced into closure.

Industry overview

The size and capacity of modern airline companies vary from those that have a single airplane that carries mail or cargo, all the way through to a major full-service international airline that owns and operates hundreds of different aircraft.

Airlines can operate scheduled or charter services that can be further divided into four different categories:

  • Intercontinental
  • Intra-continental
  • Regional
  • Domestic

There are a number of patterns that have emerged in the airline industry over the past 50 years:

Nevertheless, some patterns have emerged in the last 50 years of experience:

  1. Airline ownership in many regions has moved away from government owned or funded to self-governing, commercial public companies.
  1. Demand for airline services depends on business requirements for cargo shipments and business and leisure passenger demand. This means that the demand is highly seasonal and can often vary down to the time of day. Overall demand for airline services has increased consistently.
  1. Consolidation is a trend in airlines with partnerships being formed and takeovers and mergers also occurring, especially among airlines within a country. In the USA, more than 200 airlines have been merged, taken over, or gone out of business since deregulation began in 1978.

Early development of airlines in the USA

After the First World War there was a surplus of aviators and many took their ex-warplanes around the country to earn money from thrilling crowds with their aerobatics, or barnstorming skills. Around this time the United States Postal Service was given financial backing by congress to launch an air mail service. This grew to a transcontinental network of air mail routes by the mid-1920s, and bids were invited by independent operators for additional routes. These emerging companies included those that would one day become Braniff Airlines, American Airlines, United Airlines, Trans World Airlines, Northwest Airlines, and Eastern Airlines.

Carrying air mail was the focus of the majority of airlines until 1925 when the Ford Motor Company began construction of the all-metal Ford Trimotor, the first successful American airliner. Around the same time, Juan Trippe also began his campaign to create an air network that would link America to the world and he succeeded by launching the first international flights with his airline, Pan American World Airways.

Early development of airlines in Europe

France, Germany and the Netherlands were the early innovators of European airlines.

The Dutch airline, KLM, was founded in 1919 and remains the oldest carrier operating under its original name. Its early growth was due to passenger transport needs between the Netherlands and its colonies in the Dutch Indies.

The French airline, Air France, began life as an air mail service to Morocco in 1919. The resulting airline actually went bankrupt, but was merged with other French airlines to become the national carrier.

Lufthansa, the German national airline, began in 1926, and the airliners built by Junkers, Dornier, and Fokker were the most advanced in the world at the time.

The United Kingdom's first national airline, in the 1920s, was Imperial Airways. This became BOAC (British Overseas Airlines Co.) in 1939. British Airways was formed by a merger between BOAC and BEAC in April 1972.