GlobalIssues in Aviation
GlobalIssues in Aviation
Theimportance transport and communication cannot be gainsaid as far asthe economic wellbeing of any country in the long-term or theshort-term is concerned. Indeed, a large proportion of commerce andeconomic activities would be non-existent without the transport andcommunication sectors. This would explain why governments across theglobe have strived to invest huge sums of money in the two sectors,particularly in an effort to enhance the utilization of technology inenhancing the efficiency, ease, and convenience that characterizesthese two sectors. Perhaps one of the most acclaimed inventions inthe transport sector is the invention of aeroplanes, as they allowedindividuals and gods to be transported from one part of the globe tothe other in a matter of minutes at considerably low prices (Boef& Keele, 2005, pp. 44). This has seen a large number of countriesand regions in the globe open up even in instances where they werepreviously unreachable, with goods and services being availed moreoften than in the past. Unfortunately, as much as the aviationindustry has enhanced interconnectedness between countries, it iswell acknowledged that the sector is not deficient of some downturns.This is particularly with regard to the increasing rates of airplaneaccidents (Dobruszkes&van Hamme, 2011, pp. 47).Of course the airplane accidents are considerably low than is thecase for others such as car accidents. For instance, there has been atotal of 1015 fatal accidents that involved commercial airplanesacross the globe from 1950 to 2010. These statistics, of course,excluded aircrafts that had 18 passengers or less on board,helicopters, private aircrafts and military aircrafts. Nevertheless,the occurrence of any airplane accident always sends ripples amongindividuals in the contemporary human society especially since thereare few chances that any individual on board would get out of italive. Essentially, as much as there may be far fewer airplaneaccidents than motor vehicle accidents and fatalities it is often thecase that the effects would be felt more in the case of the formerthan the later. Questions have been asked regarding the effects ofairplane accidents on the aviation industry. While there may bediffering opinions, it is evident that accidents have a negativeeffect on all stakeholders in the aviation industry.
First,research has shown that in instances where an accident occurs, therewould be a decline in the volume of traffic in airlines. Of course,there are variations in the demand for air travel depending on thetime or season. Indeed, the demand for travelling in line withholidays, trend cycle, seasons, week days and holidays, in which caseoff-peak and peak demand periods would be formed. In instances, anaccident occurs, there is always a drop in demand particularly in thecase of the traffic of the airline that is involved in the accident.Scholars and researchers have acknowledged that in cases where theaccident takes place just before or in the course of a peak period,there decrease in demand would be considerably lower than if it hadtajen place during the normal or regular periods (Carlsson,2002,pp. 76). Indeed, in cases where accidents occur in the course ofoff-peak periods, the situation would be much higher. This underlinesthe fact that irrespective of the time period in which the accidentoccurs. This means that the airlines would have to do with lessprofits. Of course, the decline in demand for airline services isbased on the sense of safety of the customers with regard to theinvolved airlines or even the airline market as a result of theaccident (Cento,2009,pp. 46).Further, it may be noted that the severer the extent of damage andfatalities pertaining to an accident, the higher the magnitude of thenegative effect. Scholars acknowledge that the airline involved inthe accident would most likely respond to this accident throughreducing its prices so as to attract passengers, as well as increasethe load factor. This means that in the short-term, the airline willexperience a decline in its profits.
Inaddition, the airline industry suffers direct costs pertaining to thelosses of aircrafts, as well as the costs incurred in compensatingthe families. As much as a large number of airlines have alreadyinsured their planes and would most likely get compensation from theinsurance companies, they would still have to part with some amountsin terms of “insurance excess”. This adds to other costspertaining to lost hours of work and the increased need for advertsand public relations so as to regain the trust of the public andpotential travelers. This often has a negative impact on the economicstability of the airlines. Indeed, the frequent occurrence ofaccidents would leave a dent on the reputation of a particularairline to the extent of declaring bankruptcy and sometimes beingforced to fold up and exit. This, in essence, means that there wouldbe a decrease in the number of players in the aviation industry,which is detrimental to the success and sustainability of theaviation industry (Drukker, 2003,pp. 173).Similarly, airlines are insured against a large proportion of directcosts pertaining to an accident including compensation for the lossof the damaged plane and the fatalities. However, the airlines wouldstill have to bear the negative effects of market incentives such asa decrease in the equity value, switch in customer demand, andincrease in the insurance premium. Indeed, it is often the case thatthe insurance premiums will be based on the safety precautions thathave been put into place, as well as the reputation and rates ofaccidents in which a particular airline has been involved (Castillo,2005, pp. 16). This means that the occurrence of an accident wouldresult in an increase in the amounts of premiums to the airline,which, essentially, increases the costs of an accident to aparticular airline.
Ofparticular note is the fact that the effects of airplane accidentswould not only be felt by the airlines and the general public butalso the airplane manufacturers. Scholars note that in instanceswhere accidents occur to a particular airline, it would essentiallysend a message pertaining to the safety and appropriateness of theairplane and, therefore, the quality of the manufacturers’products. This would, with no doubt, result in the lower demand forthe same products, stock price and sales revenue. According toAl-Tamimiet al (2011, pp. 14), in the month after the accident, the demand forthe model type that was involved would drastically go down, with thedemand for similar sized models from other manufacturers gettingaffected adversely as well. This underlines the fact that theaccidents and the insinuations of defective products would causeimmense value losses both for the manufacturers and its competitors.Underlining the substantial nature of loses is the fact that thetotal loss that would be sustained as a result of accidents would befar much more than estimates pertaining to direct costs of theaccident.
Further,there are loses that would be incurred as a result in drop of equityfor the manufacturers and the airlines alike. However, the amounts oflosses in the long-term are dependent on the investigations and whothe blame should fall on. Indeed, researchers have noted that ininstances where the accident is found not to be the fault of theairline, the share price would drop by around 12%. This value woulddouble or even triple in instances where it is the fault of theairline (Daetal, 2010, pp. 56). Of particular note is the fact that the costs thatare imposed on the involved airlines by the stock market were lesscompared to the social cost pertaining to the accident. Nevertheless,the effects would be felt beyond the involved airline, with thevolume of travelers going down. It is noteworthy that the effectscould be positive or negative depending on the proximity of theairline to the one that has been involved in the accident. Indeed, itmay be acknowledged that the rival airlines may gain from thecustomer-switching effects, while the distant ones would lose as aresult of the general fear-of-flying effect (Bondet al, 2012, pp. 346). While this may be the case, the gains indemand for services by the switching customers would still be offsetby the loss of some potential clients as a result of the public fearof flying. Indeed, scholars have noted that the total externalityeffect in general would be negative in both the short-term and thelong-term.
Ofcourse, the major question revolves around what should be done to notonly curb the negative effects of airline accidents but also ensurethat such undesirable occurrences are reduced or even eliminatedentirely. Scholars have noted that the reduction in airplaneaccidents necessitates the participation of all stakeholdersincluding airline operators, manufacturers and the government. Giventhe negative total externality effect, it is imperative thateffective measures are put in place to reduce the possibility for theoccurrence of accidents.
First,it is imperative that the airline operators only hire qualifiedpilots and ensure that they are well monitored. An immense proportionof research has indicated that a large number of accidents resultfrom human error. This often comes into play in instances where themental state of a pilot is wanting at the time he or she takes on aplane. There have been cases where pilots are not well rested, inwhich case their fatigue decreases the speed at which they makedecisions or even the efficacy of the decisions that they make at aparticular time (Berry,2008, pp. 53). Essentially, it is imperative that the pilots andother flight operators are well monitored to ensure that not only arethey well qualified for the tasks but also sufficiently stable as faras their mental state is concerned, so as to ensure that theaccidents can be eliminated or reduced. This could involve testingtheir skills on a regular basis and subjecting them to regulartraining in the long-term so as to ensure that they are well equipped(Cai,2009,pp. 87).
Inaddition, it is imperative that the airlines subject their planes toregular and through maintenance and ensure that they have top of therange safety equipments to avert the possibility of accidents. Therehave been quite a large number of accidents in the contemporarysociety where the blame has always been placed on the airlineindustry particularly with regard to failure to subject to planes toregular maintenance. This was the case for the Concorde airplanecrash that occurred in 2000 in Paris claiming the lives of 113 peopleincluding 100 passengers, 9 crew members and four people on theground. This was seen as one of the most devastating accidents by theConcorde fleet. Subsequent investigation showed that the main orprimary cause of the accident was the deflation of one of the tyresafter the wheel came across titanium metal debris that had fallen onthe runway from another plane a few minutes prior to the taking offof the Concorde. Essentially, the researchers acknowledged that thedeflated tyres flew to the left hand side of the tank, with theimpact causing an explosion and a ball of fire that eventuallybrought the plane to the ground a few minutes after taking off(Carteret al, 2012,pp. 54). Of particular note is the fact that the management and theengineers of the airline company had, for more than 20 years, knownthat the plane did not sufficient shocks that would protect it incase of impact from external objects. This means that the accidentwould, rightfully, be blamed on the inefficiency of the airlinecompany as far as the maintenance and the incorporation of sufficientsafeguards is concerned (Blanchard,2000,pp. 56). Essentially, it is imperative that airlines subject theirequipment and planes on sufficient checks so as to ensure that thenumbers of accidents are reduced.
Inaddition, airline companies must invest heavily on securitypersonnel. In a wide range of airplane accidents, there have beenclaims of hijackers. This means that the criminals may have gainedaccess to the airplanes and used weapons to direct the planes toother destinations where it may not be safe to fly. While it is notyet clear, there have been indications that the Malaysian plane thatwent missing some time in 2014 may have been hijacked only for thepilot to be directed to unfamiliar territories where the weather maynot have been appropriate, leading to the loss of the plane and allpeople that were aboard. Similar cases of hijackers and othercriminals causing airplane accidents have been seen in the past forinstance the Libyan terrorists who shot down a British plane leadingto the deaths of all on board (Barnett&Wang, 2000, pp. 36). Of course, such episodes can only be preventedor eliminated completely through ensuring that the different lawenforcement agencies in different countries engage in informationsharing and intelligence collaboration so as to ensure that criminalsare weeded out of the society (Akhtaret al, 2011, pp. 1242). The apprehension of criminals even when theycross the borders of particular countries would go a long way inlowering the prevalence of accidents and enhancing the safety of airtravel. The effects of the same would be felt not only in enhancedprofitability and sustainability of airlines but also the growth anddevelopment of the economies of countries involved (Ashcraft,2005, pp. 76). Essentially, it is in the best interests of lawenforcement agencies in different parts of the globe to collaboratein eliminating these criminal elements (Bakeretal, 2001, pp. 449).
Lastly,it is imperative that airlines invest in technology in an effort toenhance air travel safety. There have been numerous emergingtechnologies that are aimed at enhancing safety in airplanes. Forinstance, through collaboration, research and development, Boeing hascome up with sophisticated technologies that offer distinct safetyadvantages to airplanes. A case in point regarding the manner inwhich technology has made aviation safer would be the readily visiblein flight deck systems that are designed to assist pilots to avoidtwo of the most common safety issues in that the aviation industryhas been grappling with in the recent times. These are controlledflight into terrain (CFIT) and windshear (Baltagiet al, 2009, pp. 2913). Predictive windshear equipment alongsideenhanced windshear training programs for air crew would eliminatethese types of accidents. On the same note, the “look ahead”terrain avoidance warning systems like Enhanced ground ProximityWarning Systems have considerably played a key role in eliminatingCFIT accidents (Akhtaret al, 2011, pp. 1243). There has also been other technologies thatenhance safety in airplanes including vertical situation display, asophisticated system that builds on the terrain awareness warningsystems through provision of clear pictures pertaining to thevertical position of an airplane relative to the predicted terrainand flight path (Durge,2011, pp. 56).The capability enables pilots to see through a cursory glance therunway offshoots and potential terrain conflicts at a considerablymuch earlier point in time compared to conventional warning systems.
Inconclusion, the aviation industry may be termed as one of the mostfundamental in the contemporary human society particularlyconsidering that it aids in providing better, more convenient andconsiderably safer transport alternatives (Alderighi& Cento, 2004, pp. 103). However, the recent times have seen anincrease in accidents involving airplanes, which only ends up hurtingthe industry. Indeed not only would the industry suffer direct costspertaining to the loss of equipment and the compensation required forthe fatalities but also there are social costs involved where thereputation of the airline and the manufacturers would be at stake inthe long-term (Barroset al, 2008, pp 43). Costs such as a reduction in equity as a resultof the damaged reputation, as well as the increased insurance costswould negatively affect the financial stability of all thestakeholders including the governments where the affected airlinesare located (Blanchard,2000,pp. 56). In essence, it is imperative that companies, governments andthe employees alike collaborate in enhancing the safety of airtravel. Such efforts would entail the subjecting of airplanes toregular and thorough maintenance so as to avert or minimize thepossibility of mechanical failure. In addition, companies must investin technologies that aim at enhancing safety including those thatallow for convenient and proper communication with all players(Alderighi& Cento, 2004, pp. 103). Further, it is imperative thatgovernments collaborate with each other particularly in lawenforcement to ensure that the criminal networks that have thecapacity to injure air travel are dismantled.
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