- MAINLINE AIRLINES – A type of passenger airline like PAL and Cebu Pacific that can accommodate a large
volume of passengers (100+).
- CHARTERS – A private type of airline for unscheduled flights. Usually, these are privately owned companies.
- COMMUNITY AIRPORTS – For general aviation use such as flight training and private flights.
- CARTEL – Organizations focus on “price fixing“ on the market.
- SAFETY MANAGEMENT SYSTEM (SMS) – It’s about safety and risk management in the company.
Example: In APLUS: They have SMS training for supervisors. - DEPRECIATION – In businesses, this reduces taxable income. They generate tax savings.
- TAX DEDUCTION – The higher the depreciation expenses, the lower the taxable income.
- SALE AND LEASEBACK METHOD – Airlines sell their aircraft, then lease the aircraft from the company
they sold it from. - FUEL HEDGING – Airlines will have fixed or capped fuel costs by forming a contract. This is helpful for
budgeting since they will about the risk of increasing fuel prices in the future. - APPROVED MAINTENANCE ORGANIZATION (AMO) – Companies approved by the state and ICAO to perform
aircraft maintenance. - APPROVED TRAINING ORGANIZATION (ATO) – Qualified organization offering aviation skills training.
- GROSS DOMESTIC PRODUCT (GDP) – Market value of goods and services in a country per year. An increase
in GDP will grow the aviation industry. - DOMESTIC FEEDER SERVICES – Transfer of passengers locally.
Example: People in Davao will go to Manila for international flights. This will increase local air transport
activity. - DIRECT ECONOMIC IMPACT – Effects of aviation industry activities in the local area such as an increase in
the salary of employees, and expenditures that lead to local business activity. - RP 776 – Reorganize CAB. ATO, and CAA to provide regulations to CAAP.
- AIRLINE PASSENGER LOAD FACTOR – Percentage of filled seats sold over the total number of seats of a
flight. - GROUND SERVICES – Include all the ground handling tasks in the airport such as ramp, cargo, postal, flight
operations, and surveillance services. - EO 219 – Executive order establishing the Domestic and International Civil Aviation Liberalization Policy.
- OLIGOPOLY – A market structure in which a market or industry is dominated by a small number of large
sellers or producers.
- Act No. 3996 – An act concerning the licensing of airmen and aircraft, inspection, air traffic rules, schedules
and rates of aviation companies, and the enforcement of the law.
MAINTENANCE AND LAWS
- CONFIGURATION DEVIATION LISTS (CDL) – Declared by mechanics when they approved the aircraft to fly
even though some external parts of an aircraft are missing. The aircraft is airworthy even with missing
parts. - MINIMUM EQUIPMENT LIST (MEL) – The aircraft is still airworthy even though some minor parts are
broken. - ASSOCIATIVE METHOD – The statistical relationship between the forecasted (dependent) variable and
explanatory (independent) variables. - Out of Service Time – The time when the aircraft is unprofitable.
- 16 hours – Daily limit maximum flight time for pilots.
- 10 hours – Rest period of pilots when they reached 16 hours shift in a day.
- COMMONALITY – Operating a standardized fleet of aircraft that share common parts, and other
characteristics. - RATIONALIZATION – Making a company more efficient by using quality equipment and hiring the right people.
- STANDARDIZATION – Simplifying things and processes to reduce cost.
- 100 HOURS – Limit of pilots to fly in 1 calendar month.
- 8 HOURS – Rest period of flight crews in any 24-hour period.
- 40 FLIGHT HOURS – Maximum flight duty of flight crews in 7 consecutive days.
- 24 HOURS – Minimum time to rest from duty of a flight crew for the week.
- IN-SERVICE – Aircraft flown on scheduled services.
- OUT-OF-SERVICE – Aircraft temporarily assigned for maintenance or special projects.
- LINE RESERVES – Extra aircraft used for backup.
- ACCELERATED DEPRECIATION – Makes depreciation faster such as postponing taxes over the life of the
asset, increasing the rate of return on that asset. - OPERATING LEASE – The leasor remains the title of the asset. A noncancelable short-term lease.
- FINANCIAL (CAPITAL) LEASE – Title passes to the lessee. Title of the asset remains with the leaser until
all payments are done. - COMPUTERIZED RESERVATION SYSTEMS (CRS) – Displays airline schedules and prices for the agents to
make reservations.
AIRLINE MANAGEMENT
- BOARD OF DIRECTORS – The chief governing body of a corporation made by the stockholders. They elect
the president and other executive officers. - TOP MANAGEMENT – Under the board of directors is the top management. Includes CEO, executive VP, and
senior VP. - MIDDLE MANAGEMENT – They interpret policies and are responsible for developing operational plans and
procedures. - OPERATING MANAGEMENT – Focus on the execution of policies. It includes managers, assistant managers,
section chiefs, general supervisors, and supervisors who head up departments. - LINE DEPARTMENT – They produce and sell air transportation products. Examples: flight operations,
engineering, maintenance, marketing, and other services. - FIXED COST – Remain the same regardless of the sale.
- DEFERRED TAXES – Refer to certain taxes that companies are required to collect for various taxing
authorities, including federal excise and state sales taxes and payroll withholding of employee income taxes. - VENTURE CAPITAL – Money is invested in business enterprises that generally do not have access to
conventional sources of capital. - SELF-FINANCING RATIO – The proportion of capital expenditure financed from internal sources.
- DEPRECIATION – This represents the airlines’ largest single source of internal funds.
- OPEN JAW – The departure and the destination are not the same each way.
- APEX FARE – Fares are usually purchased in advance.
- BEREAVEMENT FARE – Offer them to family members for funerals, or in the case of imminent death.
- LAW OF DEMAND – States that other factors being constant, price and quantity demand of any good and
service are inversely related to each other. - ELASTICITY OF DEMAND – Percentage change in passenger demand over the percentage change in price.
- A-CHECK – Every 125 flight hours (2-3 weeks), Involves pre-flight visual inspections.
- B-CHECK – Every 750 flight hours (3-4 months). Involves preventative maintenance, oil and lubrication
replenishment, and all tasks from A-check. - C-CHECK – Every 3,000 flight hours (15 months). Incorporates A and B-check, flight control calibration,
structural inspections, and post-check flight tests. - D- CHECK – Every 20,000 flight hours (6-8 years). Parts are removed for structural inspection. The aim is
to return the aircraft to its original condition. - DIRECT OPERATING COSTS – Include all flying expenses and all aircraft depreciation expenses. Ex. Aircraft
insurance, oil and fuel cost, and employee salaries.