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. Last Updated: 07/27/2016

11/30/1992

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In Air Travel, Deregulation Needs Rules

The alarming increase in air crash fatalities in Russia - 160 already this year, compared with 67 in 1991 - is enough to send a chill through regular Aeroflot passengers. Though air fatalities fluctuate naturally from year to year, there is plenty of reason to believe that this rise is something more than a statistical aberration. If ever there was a dangerous mix of business turmoil and critical safety needs, then it is Aeroflot's painful transition to profitability. Consider the airline's recent history and near future. Once the world's largest airline, Aeroflot has been divided into 15 newly independent airlines -14 of which operate without supervision by the Russian Ministry of Transportation, depending instead on republican ministries that became instant air companies. Fuel, once 25 percent of Aeroflot's costs, is now 60 percent of the operating budget. This puts tremendous pressure on the airline to try to cut costs elsewhere.
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