IMPACT OF DEREGULATION ON INVESTMENT AND PRODUCTION STRATEGIES IN THE COMMERCIAL AIRCRAFT INDUSTRY

The impact of the Airline Deregulation Act of 1978 on the U.S. aircraft manufacturing industry is investigated. The ways in which the removal of fare and route restrictions precipitated a restructuring of the investment and production strategies of the two major domestic airframe manufacturers are explained. On the basis of a series of interviews with informants in the airline and aircraft manufacturing industries, it is concluded that deregulation has affected the commercial aircraft industry in four significant ways: (a) fleet analysis procedures were transformed following deregulation, (b) the emergent hub-and-spoke system precipitated major fleet reconfigurations, (c) there was a rise in manufacturer and institutional financing and leasing agreements, and (d) airlines were saddled with aging and multiple-model fleets. Manufacturers have responded to these developments by assuming an increased share of the risks associated with aircraft acquisition, incorporating customer concerns in aircraft design, and reducing capacity while increasing productivity.

• Record URL:
  http://onlinepubs.trb.org/Onlinepubs/trr/1995/1480/1480-005.pdf
• Record URL:
  https://scholar.google.com/scholar_lookup?title=IMPACT+OF+DEREGULATION+ON+INVESTMENT+AND+PRODUCTION+STRATEGIES+IN+THE+COMMERCIAL+AIRCRAFT+INDUSTRY&author=E.+Golob&publication_year=1995
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• Supplemental Notes:
  • This paper appears in Transportation Research Record No. 1480, Public-Sector Aviation Issues: Graduate Research Award Papers 1993-1994. Distribution, posting, or copying of this PDF is strictly prohibited without written permission of the Transportation Research Board of the National Academy of Sciences. Unless otherwise indicated, all materials in this PDF are copyrighted by the National Academy of Sciences. Copyright © National Academy of Sciences. All rights reserved
• Authors:
  • Golob, Elyse
• Publication Date: 1995

Language

• English

Media Info

• Features: References; Tables;
• Pagination: p. 37-42
• Monograph Title: Public-Sector Aviation Issues. Graduate Research Award Papers 1993-1994
• Serial:
  • Transportation Research Record
  • Issue Number: 1480
  • Publisher: Transportation Research Board
  • ISSN: 0361-1981

Subject/Index Terms

• TRT Terms: Aircraft; Aircraft industry; Airframes; Financing; Fleet management; Hub and spoke systems; Impact studies; Industries; Investments; Leasing; Production; Productivity; Risk management; Strategic planning; Vehicle design
• Identifier Terms: Airline Deregulation Act of 1978
• Uncontrolled Terms: Aging aircraft; Aircraft design; Capacity; Risk sharing
• Old TRIS Terms: Fleet analysis; Fleet reconfigurations; Multiple-model fleets
• Subject Areas: Aviation; Design; Highways; Planning and Forecasting; Vehicles and Equipment;

Filing Info

• Accession Number: 00712971
• Record Type: Publication
• ISBN: 0309061180
• Files: TRIS, TRB
• Created Date: Oct 10 1995 12:00AM