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Development History of Price Management in Aviation Market

by:CNS     2021-07-09
The development history of price management in the aviation market 2021-06-20 10:09:00 1938~1978 In order to avoid excessive competition and unfair competition within the aviation industry, the US Civil Aviation Law imposed controls on the aviation industry to control tariffs and revenues. Fares remain high and the financial situation deteriorates. The Air Passenger Deregulation Act was passed in 1978 and emphasized that the government should reduce its control over the aviation industry and adopt a policy of liberalizing fares. The Civil Aviation Commission no longer controls airline fares. Since the 1990s, Brazil, Germany, Japan and other countries have begun to loosen government controls on civil shipping prices. Deregulation generally goes through three stages: In the first stage, airlines strictly enforce government pricing, and they are changed to allow airlines to apply preferential discounts and fares to some passengers with additional restrictions. The restrictions are set by the government or Approval. In the second stage, the transition is to no longer stipulate the restriction conditions, but the government defines the range, the airline's independent limited floating fare system, and gradually expand the airline's independent floating range. In the third stage, the restriction on the range of independent pricing by airlines is cancelled. At present, domestic air passenger transport in developed countries has basically implemented market-adjusted prices, allowing air transport companies to independently set prices based on market supply and demand conditions and marketing needs. Since 1949, the price management of the domestic aviation market has gone through different stages of development, from the initial unified government pricing, to later government-controlled pricing, and then to the current government-guided pricing. National policies at different stages of development are also significantly different. From 1949 to 1974, the government set a unified price for domestic air passenger tickets. At this stage, airlines are operating well and remain profitable. There is almost no competitive atmosphere in the market. The overall air passenger volume and cargo volume are relatively small. From 1974 to 1984, the government still has unified pricing, but based on the income background and the purpose of travel, different prices are set for domestic and foreign passengers. Two prices are implemented for domestic flights. The fares for foreign passengers are slightly higher. The profitability status remains good. From 1984 to 1997, the government further adjusted the unified pricing method and began to give discounted fares to Chinese citizens, while the published fares were still implemented for overseas passengers. At this time, airlines continued to maintain profitability. From 1997 to 1999, the government controlled air tickets and set a type of fare for specific routes, but airlines could provide different discounts according to the needs of their operations; from this moment on, the country has gradually relaxed its strict restrictions on ticket prices. . Since then, some airlines have begun to lose money. From 1999 to 2003, the government continued to control the price of air tickets, but in order to curb the proliferation of price wars in the aviation market, new policies such as 'no discounts' and 'airline alliances' were introduced. Subsequently, airlines gradually resumed profitability. From 2004 to now. The government guides airlines for pricing, and each airline introduces mature revenue management systems in Europe and the United States, sets multi-level fares, and differentiates consumers through various means. After excluding the impact of major disasters and emergencies, airlines have achieved overall profitability. Therefore, for airlines, the real realization of this own price behavior is after 2004. In the process of pricing from Guangzhou to Xiamen logistics, both airlines and airports have gradually adopted many effective pricing methods and techniques to recover costs and gain benefits. This article will mainly introduce the basic pricing principles and the more widely used pricing strategies in the air transport industry.
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