Josh Wagner's Blog

An otherwise deemed unsustainable and small market has shown evidence of growing and is shocking economists. This market is for car sharing whereby users pay for access to a car that is charged by the hour or even the minute. The service works by having a customer order a car and pick up the vehicle at a nearby parking area. The car is then dropped off at similar location and locked using a keycard. I find the growth of this market quite fascinating because it shows that the demand for more sustainable transport is growing and therefore it is becoming profitable for companies to supply more environmentally sustainable goods and services. Additionally, this is going to become both an issue and a benefit for car manufacturers. In the short term, the growing car-sharing market will show an increase in demand for certain vehicles. Although in the long run, a growing car-sharing market will become a substitute service for owning a car. If this market continues to grow, and trends have shown that it will, car manufacturers may need to invest more heavily in electric vehicles that car-sharing companies may be interested in, to maintain sales in the long term.

More information can be found in the article:

http://www.economist.com/node/16945232

Recently Air Zimbabwe has been struck by a series of striking pilots due to a cut in allowance payments. As a result, the chairman of the company has refused to “entertain [their] demands” and has essentially fired all pilots that are continuing to strike. This issue is expected to continue into the courts, however I believe this is simply going to exacerbate the situation as their brand’s image is being destroyed. Furthermore, there is the obvious ethical issue as to whether the pilots are entitled to these payments, especially from a company that is being described as “cash-strapped”. If the company decides to give in to these demands, they may be left with long term legacy costs that will create a liability for the future. In addition, their fixed costs will increase and will most likely put the company in a more difficult financial situation. On the other hand, if the company decides to continue to ignore the pilot complaints, they will be faced with an increased drop in revenue as they are already losing “half a million US dollars a day as a result of the strike”. I personally believe that the company needs to re-create their entire business plan and perhaps adopt one similar to Ryan Air in order to increase their profits and financially overcome the strike.

Article URL : http://www.bbc.co.uk/news/business-11273905

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