Air Carrier Case Study

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2.4. Characteristics of market development scenarios in the context of the creation of the new air carrier
Depending on the market development scenarios in the context of creation of new air carrier proposed hypotheses of the study can be proved or disproved. Thus, below are factors that determine the development of scenario, confirming alternative hypothesis, according to which the creation of new air carrier providing safe, effective, low cost air services to a wide range of consumers will be profitable:
Obtaining the required governmental approvals.
Securing financing.
Experienced management.
Marketing; either dealing with channel problems and barriers to entry; or solving problems with major advertising and promotion budgets. Targeted
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Traffic expansion faster than speed of expansion in the sector. During recent years, where the Turkish civil aviation sector entered into a serious growth trend, Pegasus has proven to be satisfying a significant demand in aviation sector with the number of its guests increasing much more than average growth in the sector. In 2012, Pegasus Airlines, the second largest airline in Turkey, has signed for up to 100 A320neo Family aircraft (57 A320neo and 18 A321neo models), of which 75 are firm orders. Pegasus becomes a new Airbus customer and the first Turkish airline to order the A320neo. This is the largest single commercial aircraft order ever placed by an airline in Turkey, and was announced on December 18, 2012. In 2012, Pegasus Airlines carried 13.6 passengers in total. Between 2008 and 2012, the number of passengers has grown by a cagr of 32.5…show more content…
Dry leasing - 3 (followed by 2 additional aircraft in subsequent years) narrow body jet aircraft, either Boeing B737-800 or Airbus A320 family types with high-density seat configuration.
2. Provision of a sufficient cash reserve to assure timely payment of the leasing payments and all operating costs related to the aircraft through at least the first three months of scheduled operations.
3. Marketing, advertising, and public relations costs, including costs of setting up a website capable of offering flight and company information and making online sales for airline tickets, and related Internet marketing, as well as conventional print and broadcast advertising, and public relations activities.
4. Costs associated with recruiting, training, and certifying required cadre of flight, ground crew members, including management and administrative support staff members.
5. Sufficient reserve to cover overall operating costs, aside from aircraft related operating costs, over at least the first three months of operations.
6. Administrative and legal costs incurred in the establishment of the enterprise and commencement of flight

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