British Airlines Literature Review

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The literature review for the responses of some airlines (Qantas, Air New Zealand, Air Canada, Alitalia, Iberia, Aeroflot, ANA, LAN, TAM and British Airways) is summarized below in terms of setting up an LCC, alliance/merger/partnership/franchise, capacity, and fare and product policy: Figure 6 : Some of the major airlines in the world

Table 17 : Responses of Qantas to LCCs (Forsth, 2003)
Country Australia
Airline Qantas
Deregulation 1990
LCC entry Compass, 1990(lasted 1 year)
Compass Mark II, 1992 (lasted 6 months)
Kiwi Airlines, 1995 (international operations) (collapsed by Freedom Air)
Impluse, 2000 (taken over by Qantas in the first half of the year)
Virgin Blue, 2000 (subsidiary of Virgin Group)
Responses
Set up LCC Quantas set up its
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Alliance/
Merger/
Partnership/
Franchise • Merger with Iberia in 2011
• oneworld alliance member
Capacity Decrease frequency on some of the routes by
• transferring operations to regional carriers
• replacing 737s with regional jets
Catering operation outsourced
Fare • removal of minimum stay requirements for cheap fares on short haul flights while requiring a return journey enabling the tickets starting at opposite directions may not be cheap.
• made some one-way seats available at lower fares through consolidators.
• made lower fares tickets flexible but in case of change difference in price has to be paid
Product

The below Table 27 summarizes the overall result for the analyzed airlines;
Table 27 : Response Strategies of some airlines
Airline Overall
Result Response Strategy Price revision Capacity change Product enhancement Subsidiary LCC Alliance membership
Aefoflot  -    
Air Canada     x 
Air New Zealand     x 
Alitalia x  - - - 
ANA  -   - 
British Airways    - x 
Iberia     - 
LAN  -  - - 
Qantas   -   
TAM     -

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