Homework Question on Alaska Airlines
- Within Alaska, they are, for the most part, the only major carrier in town conducting commercial operations throughout the state. How much of their financial success would you say is attributed to essentially monopolizing the market for major air travel in the Pacific Northwest?
- Would their strong financial performance remain unchanged if the same company and employees were to fly more “lower 48” routes with comparable markets?
Homework Answer on Alaska Airlines
Considering his monopoly operations in the Pacific Northwest, a large portion of its financial success should be attributable to its monopoly operations. The monopoly operations had increased the capacity of the passengers available in the airlines. Also, the Alaska Airlines is also more pressured to launch new routes that increase the expected financial success in the company. Considering the increases costs of operations facing other competitors or airlines including the Southwest Airlines and Hawaiian Airlines, the monopoly power of Alaska Airline remains a motivating factor.
Alaska Airline is able to consolidate its operations with the regions using the same techniques such as shifting to large aircraft and the reconfiguration of aircraft. The techniques are aimed at increasing the capacity of the airlines being the only major carriers in the various states. As a result, a large portion of Alaska Airlines financial success is attributable to its monopoly operations with the various states.
I think there strong financial performance would remain unchanged even if the company operated within more lower 48 routes with comparable markets. First, it has the geographical advantage than the other carriers making it likely to gain more profits from its operations. Most important, the local markets stills remains underserved and I believe its operations in other lower routes would not lower their financial performance. In spite of all, it is consistency and independence of operations would be affected threatening the achievement of strong financials.