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Us Airways Group

Essay by   •  February 24, 2013  •  Case Study  •  338 Words (2 Pages)  •  1,187 Views

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Summary

Data and information have been gathered on a monthly basis over a six year period from 2006-2012 illustrating US Airways' revenue passenger miles. All data for this study was obtained through the United States Securities and Exchange Commission from direct documents from the US Airways Group. Dependent data is represented by revenue passenger miles in billions. Causal data selected has been gathered from other governmental agencies. The independent data used in this study are the average prices of all forms of gasoline, unemployment rates, and on-time rates. All independent data are recorded as monthly data over the same six year period.

Evidence

Data Shows Seasonality Over 6 Year Period

Figure 1 illustrates that revenue passenger miles (RPMs) are seasonal and that there are both monthly and quarterly patterns year after year.

Figure 1.Revenue passenger miles over a six year period of monthly reports from US Airways.

Figure 1 shows a stationary trend where there is no dramatic growth or decline over the six year period which indicates that US Airways will ultimately continue its seasonal pattern regardless of external factors. During the six year period examined, there were several external factors that affected the revenue of the company yet, the data continued to remain seasonal both monthly and quarterly. From the data gathered, it can be concluded that RPMs will continue to peak during the months between May and August and will drop in the beginning months of each year.

Unemployment Rates Affect Revenue Passenger Miles

Figure 2 displays the relationship between revenue passenger miles and the unemployment rate during the six year period. During the economic recession, the unemployment rate was the highest at 10.0% while US Airways had the lowest reported revenue passenger miles.

Figure 2. Unemployment rates during the six year RPM period.

Future forecasting would reveal that when there is an economic recession or downturn, less consumers will be using flight for travel resulting in a decrease in revenue. With that said, as unemployment rises in the future it is important to consider the amount of business travel being lost.

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