Canada's Airline Duopoly: Is It an Optimum Strategy in a Globalized, CommoditizedAir Transport Environment

摘要

Economic, political, and geographical pressures are causing airlines to rethinktheir objectives for long-term survivability due to a changing environment. Three important events are changing international aviation markets in the nineties: the European single market, the continuation of immense growth in the Pacific, and the development of long range aircraft with acceptable economics. The current duopoly in Canada suggests that economic forces have allowed only a few firms to serve the marketplace profitably. Concentration has occurred by mergers and takeovers which took place, prior and during the deregulation phase that was formally introduced in 1988. In determining an optimum strategy for the Canadian airlines, one must consider the implications for all parties concerned, in terms of use and regulation. This report examines the Canadian situation in a global marketplace, and recommends a future strategy to compete more effectively in a globalized marketplace, while trying to balance the wants and needs of all parties. A number of strategy options suggested highlight methods of achieving efficiencies that are present within the Canadian air transport market. Overcoming the political obstacles is necessary for future strategy implementation. Only through cooperation and coordination by governments, consumers, and airlines can a beneficial option be achieved. It is suggested that in the end, a compromise by each of the parties involved, will be necessary to achieve stability in a rapidly changing and consolidating marketplace.