What is Deregulation in the airline industry? and How it is impact on Tourism?

What is Deregulation?

• The process of removing government imposed restrictions on an Airline can be called as deregulation.

• Airline Deregulation act was established in 1978.

• USA became the first country to implement deregulation and it was signed by the USA president Jimmy Carter.

• The main target of deregulation was to grant more competition between airlines and to allow more flying routes.

So let's see what are the positive impacts of deregulation towards the Tourism Industry.

• Tourism has grown to a rapidly developing industry and many countries are making efforts to be competitive among other countries. This led to deregulations of tourism by many countries to encourage tourism.

• Because of Deregulation new airlines and new flying routes emerged. And also the price for air travel reduced highly. Because of that many people started travel around the world through air.

• The emergence of Low cost carriers due to deregulation was another plus point towards the tourism industry. Many people like to travel on Low Cost Carriers because they don’t need to spend more time on traveling. Low Cost Carriers turned the aviation industry around a lot because of its low fares.

• Many People started to travel around the world to learn about new things. Many started to learn about new cultures because of the frequent travel. Due to the restrictions lifted on the airspace, many countries were able to travel other countries without any difficulties.

Are there any negative impacts of deregulation towards the Tourism Industry?

Yes, in my point of view after deregulation the aviation industry became competitive. Because of that cheap tickets were introduced. This had a negative effect on the airlines. To be more competitive the airlines had price wars and due to this effect the ticket price did not reduced, but it increased its value by 150%. The airlines became greedier. They started to get more money from the passengers. So this had a major effect on the tourism industry.

Hence, the deregulations in the airline industry as detailed in above paragraph indicate the proper picture of more advantages for the airline industry.