Divisibility, Technology, and the Competitive Potential of Regional Airlines

Abstract

During the 12 years following deregulation of the airline industry, tremendous change has taken place involving both industry structure and industry competition. Much of the discussion concerning these changes has not fully considered the factor supply side of the industry, especially with respect to emerging technology and factor indivisibility. However, new technology airframe and engine design (turboprop and turbofan) and the use of new materials promises to mitigate the problems associated with aircraft size. The availability of this new technology will enable regional air carriers to implement new competitive strategies such as regional hubbing and hub bypassing. This paper discusses the impact of technology on the competitive potential of regional airlines, looking at the benefits of and impediments to such competition.

Authors

• Fawcett, Stanley A Embry-Riddle Aeronautical University
• Fawcett, Stanley E Embry-Riddle Aeronautical University