Pestle Analysis of Virgin Atlantic Airline

Political analysis

It inspects the guidance of government. It is about policies, rules, and regulations on the industry or association with reference to Virgin Atlantic Airline. It can be debated that several political factors such as taxation policies, labor low, customer policies and trade restrictions forced by the government have a great impact on the airline industry. According to Virgin Airline management, they are an expression with various political challenges when business spread into foreign countries compared to the UK, ( ex; USA & Australia). Most of the political challenges are embraced by licensing, bureaucracies set by the UK and foreign governments also increased parameter and control of business operation by the government.

Economic analysis

Virgin Atlantic Airways has been challenged with hard competition from other firms in the industry, for example, the organization was required to lower its flight rates following an analysis of prices for air travels by its major opponents in the air transport industry such as American Airlines and UK Airways. Because of this competition in 1990 “ Virgin Atlantic offered first class ticket at business class prices, inventions included limousine pick up for first class passengers and seat back video entrainment systems for economy class passengers”. This new decision creates an opportunity to win the economic competition and get more profit & customers.

Social factors

British Airways, Atlantic Airways and other airlines such as EasyJet have already requested the EU and the French government to advance an action plan to minimize the effect of ATC( Air traffic controller) attacks on passengers A number of ATC union strikes hit France in 2016 due to social unrest over a series of disputed labour reforms from the Socialist government, causing Virgin Atlantic to cancel many flights to and over France The peak summer season in 2016 was difficult to operate for many airlines including Virgin Atlantic, largely due to social factors outside of the airline’s control particularly, air traffic controller (ATC) strikes in France.

Technologic analysis

Further, as Jones (2009) has argued, the Internet makes industry competition perfect because it allows passengers to compare airfares of different airline companies with just a few clicks, which in effect affects pricing ability, according to Gal-Or (2011). Nevertheless, the internet also offers a cost-cutting chance for Virgin which is why it recently launched AIR4, Virgin Atlantic’s major technological revolution in company history, which saw Virgin invest in IT-based passenger service systems such as the new mobile app, self-service booking technology and improved kiosk functionality (Annual report 2016).

Legal environment

During the December 2016, Virgin Atlantic pilots decided to take industrial action in a row over union recognition after the pilots union, Professional Pilots’ Union (PPU) which represents over 70% of Virgins 900 plus pilots, demanded to be the only exclusively recognized union for Virgin’s pilots and for British Airline Pilots Association to be derecognized (The Guardian 2016).

Environmental Factors

People are much attentive to the effects of climate change since the people of all nations carry knowledge about some form of negative disaster; from floods, drought extreme record-breaking hot temperatures, record-breaking sub-zero temperature etc., that has been credited by scientists on global warming. Virgin Atlantic like many other airlines faced sustained working disruption in June last year (2016) as well as January 2017 due to adverse weather conditions, in particular thunderstorms in South East England, which led to a cancellation of flights to and from London Heathrow and Gatwick and a delay in many other flights (Swinnerton 2017).