Air India Express Flights - Mergers in the Airline Industry - Effect on Air Planes

As rumors go, currently Iberia is on focus by British Airways but also by Air France KLM. Not long ago Air France took over the Dutch airliner KLM.

Companies merge because so they can achieve more growth and a higher profitability.

There are just more flight options to offer for clients which is the best basis for supporting a future expansion, in case of KLM Air France. Growth as a criteria for merger is quite straightforward.

Because for European candidates there are only two options: Airbus and Boeing, and this is also very simple. Costs are quite simple: buying and leasing airplanes, in case of the airline industry. But mergers are also about costs.

But there are many (larger) Boeing planes, air France's fleet is more Airbus oriented. The Fleet of KLM is mainly supported by Boeing airplanes.

This must be because of the consortium Spain as well as France are in, has mainly Airbus planes, the Spanish airliner, iberia.

What will happen to this fleet architecture?

Also the focus on a single airplane will concentrate knowledge and knowledge management will be more simple (for example the learning cost to manage and operate a plane types versus more plane types). Advantages of a single airplane manufacturer are most of all cost efficiency and negotiation power.

There is a status (and style) difference (Made in the US versus Made in the EU). Not all planes between either airplane manufacturer are really similar and therefore replaceable. There are also disadvantages.

Flexibility is another disadvantage: a single provider will be less flexible. There is no longer a trade-off. Bargaining power is also a disadvantage because of increased dependency on a single partner.

Much depends on the success of airbus and on the success of the EU itself. A political lobby could favor European companies to use Airbus. And then there is a political component.

2007 Hans Bool ©