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Full-Text Articles in Social and Behavioral Sciences
Information Technology System Failure And Value Of Airlines: A Case Study Of Airlines In 2016, Jayendra Gokhale
Information Technology System Failure And Value Of Airlines: A Case Study Of Airlines In 2016, Jayendra Gokhale
Publications
Technology is a critical component of a firm’s operations. Technology failures can cause widespread problems in airlines. These failures cause disruptions in flight schedules, cause passengers to be stranded at airports and also increase airline operating costs. The objective of this study is to measure an effect of information technology failures on the firm value of passenger airline companies during the year 2016. In that year, there were cases involving delays and cancellations associated with JetBlue, Southwest, Delta, American, and Virgin America that received significant media coverage. Using the event study methodology, this study finds that the intensity of failures …
Effect Of Weather Delays On Shareholder Value: Evidence From The Airline Industry, Jayendra Gokhale, Sunder Raghavan
Effect Of Weather Delays On Shareholder Value: Evidence From The Airline Industry, Jayendra Gokhale, Sunder Raghavan
Publications
Airlines measure service quality based on different factors such as on-time performance, delays and cancellations, mishandled baggage and denied boardings. Among the above factors, recent studies show that long delays and cancellations have a major impact on airlines bottom line not only in terms of current costs but also in terms of loss of future revenue. Finance literature tells us that stock prices reflect the present value of future cash flows. In this paper we use event study methodology to examine how weather delay and cancellations affect current stock market returns for our sample airlines. We find some evidence that …
The Effect On Stockholder’S Wealth On Critical Systems Failure And Remedy: The Boeing 787 Case, Jayendra Gokhale, Sunder Raghavan, Victor J. Tremblay
The Effect On Stockholder’S Wealth On Critical Systems Failure And Remedy: The Boeing 787 Case, Jayendra Gokhale, Sunder Raghavan, Victor J. Tremblay
Accounting, Economics, Finance, and Information Sciences - Daytona Beach
In this paper we analyze the effect of Boeing Dreamliner 787’s battery problems on stockholder wealth. Using the event study methodology, we show that the recall in January of 2013 initially caused the company’s cumulative abnormal returns to fall by almost 4% in four trading days after the recall. This was followed by an announcement by two major airlines to ground all of the 787 Dreamliner jets. The FAA also ordered all US airlines to ground their 787s and announced an investigation to review all critical systems of 787s. However within four months of the investigation, FAA approved Boeing’s revisions …