Deconstructing commodity risk analysis: A theoretical perspective from the airline industry – Part 1

This paper implies the testing of the impact of commodity risk on airline capacity forecasting, which is based on a system dynamics framework. The urgency for this investigation has been derived from the airline industry's most severe challenge – the profit cyclicality. There, capacity forecasting is considered to be one of its key drivers. It is merged into the starting point of airline capacity planning – forecasting. An extensive literature review implies the essential elements of the paper – risk management, forecasting, and the critical characteristics of the airline industry.