3513NSC Economics in Aviation

Your assignment is to be in the report format. • In 1990, Australia introduced deregulation of the airline industry. One of the near immediate results was the startup of the first Australian Low-Cost Carrier (LCC) Compass Airlines in December 1990. Within 12 months, Compass ceased operation and a new airline, known in the industry as Compass II,started in August of 1992. It too failed with operations ceasing in March 1993. Yet Virgin Blue started in August 2000 and succeeded as a LCC up until the Global Financial Crisis in 2009.
You are to determine the reasons why both versions of Compass failed and what its leaders should have done, using the aviation economics principles of the course up to Week 8.
In your examination of the reasons for the Compass failure, you are use comparisons where possible of why Virgin Blue and Jetstar succeeded where both versions of Compass failed, showing strengths and weaknesses.