The airline industry is known worldwide for its dynamic nature in a volatile market that typically experiences numerous changes. Nonetheless, air transport has proven to be a flexible and reliable mode of transportation that also doubles up as a dependable option in as far as ferrying goods is concerned. It is for this reason that the airline industry has been growing exponentially over the past decade, favored by a collection of favorable factors. Some of the reasons why this sector has been developing at a record pace include the enactment of incentives aimed at reducing regulation coupled with a move by firms to create low-cost models. The airline industry presents unending opportunities to make profitable gains, which is why investors have recently flocked this market, investing millions of dollars into this nascent entrepreneurial venture. A large chunk of this money is spent on improving an airline’s fleet as it is often viewed as an effort geared towards increasing the firm’s profitability. Growing annual projections is a major objective of carriers, which can only be achieved by minimizing operational costs while capitalizing on the resources available at any given moment (Lantseva et al.). An important fact that needs to be acknowledged is the resilience of this cost-driven industry, no stranger to the seasonality of air ticket prices. Even though economic experts have failed to pay particular attention to this phenomenon, fluctuation of ticket prices remains at the heart of the airline industry, due to the fluidity causative factors. In particular, this event has been witnessed in the Middle East and the reason why Emirates Airline will serve as a case study to better understand the seasonality of tickets purchase and prices.
According to Kraft and Havlikova, the seasonal demand for tickets is often as a result of travel patterns of individuals all across the globe (70). Globalization, in particular, plays a significant role in this intricate web of factors that ultimately influence that the demand and purchase of tickets. It’s vital to acknowledge that the world is presently more connected than it has ever been. The expansion of travel channels and technological innovations has over the years simplified the process of traveling. Before these changes, traveling to far-flung areas was virtually unheard of, with those choosing to make such excursions often facing an arduous task. Air travel, for instance, revolutionized the travel process, primarily by cutting down significantly on significantly on travel time. Individuals from different walks of life made the most out of this development to travel to different localities across the globe in search of unending opportunities. Most immigrants are motivated by the promise of financial security, affordable housing, and advanced education programs. These individuals maintain correspondence with their kin back at home and would make a point to travel, even if it means doing so once a year. Leading airlines such as Emirates have invested heavily in mapping out the travel patterns of different groups of individuals across the globe. This seasonal demand for tickets is responsible for a boom in business for leading airlines that are a preferred choice for most passengers. Occasions such as the Holy month of Ramadan are held in high esteem by all Muslim faithful across the globe intent on making their pilgrimage to Mecca each year. Even though demand for tickets during such an occasion would be high, but still on demand, translating to profits for the companies involved.
Suppositions by Garrigos-Simon, et al. on the impact of seasonal demand on tickets paints a negative picture of the since airlines will undoubtedly be making huge profits at the expense of the traveler (351). During this particular period, carriers such as Emirates are well aware of the high number of potential clients traveling to specific locations around the world. Airlines are often well aware of the fact that a considerable number of individuals would be flying at these particular moments but still, choose to hike ticket prizes. At the end of it all, they end up on top in this elaborate game while the customers are forced to dig even deeper into their pockets to purchase tickets. There are numerous occasions where a family is unable to afford these trips and are sometimes forced to leave some members behind or forfeit it all together. As a result, families that would typically spend time together during momentous cultural or religious occasions are separated and fail to enjoy it as they would have if they were together. All this is as a result of these capitalistic tendencies that emphasized profitability above anything else. Moreover, fluctuation in the price of tickets has a ripple effect that has a far-reaching impact on travelers. Other industries take their cue from airline companies when tweaking their prices for the goods and services that they offer, making it even more expensive for tourists (Alves and Caetano 21). Accommodation, in particular, proves costly for tourists as hoteliers seek to keep up with the high demand for tickets by ensuring that they too hike prices. In this scenario, industries that have a direct connection to the airline industry capitalize on the seasonality of ticket demand, which often translates to additional costs that have to be serviced by travelers.
Lantseva, et al. opines that the overall impact of the seasonal demand for airline tickets eventually hinders tourism altogether (271). Airline economics is often wrought with apparent disparities in the cost of travel, especially if one is to compare high and low seasons. Demand for prices is usually high during particular periods, for instance during the start of winter when a tourist would typically prefer to vacation in countries that warmer climatic conditions such as the United Arab Emirates (UAE). One of the common excuses given by airlines for hiking their airline tickets is a response to a rise in global oil prices, which is often not the case. Leading fossil fuel companies that increase the cost of jet fuel only do so as a response to the seasonal demand for airline tickets and the price hike that follows (Kraft and Havlíková). In reality, these companies implement this policy to level the playing field and ensure that airlines such as Emirates do not end up reaping the lion’s share of the profits made. A reality that many have to contend with is that the income of many of these individuals remains static, even with an increase in the cost of living as a response to global gas prices. The resultant effect is that these individuals end up forfeiting their travel plans altogether due to its costly nature, ultimately lowering the number of individuals willing to travel.
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