The comparative analysis of financial risk level of airlines companies by using fuzzy logic method

Abstract

Civil aviation sector has entered a rapid development process in the globalized world and increased competition has forced companies to be included in the different alliances. Furthermore, the low cost airline companies appeared in the nineties has changed the structure of the sector and the competition has become more difficult. The costs of minimum standards on flight safety as well as this tough competitive conditions make it difficult for companies to manage their financial risk. This study aims the comparative analysis of financial risk levels, measured over their financial ratios, of Star Alliance, One World and Sky Team; the world's three largest global airline alliances and the airlines that sell cheap tickets through low cost strategy by performing fuzzy logic method. Two different analysis are made using two different models. The first analysis results show that there is no difference between alliances and low-cost airlines in terms of financial risk levels for the period of 2010-2014. However the second analysis results show that there is difference between alliaces and low-cost airlines in terms of financial risk levels.