Competitiveness Airports operate in a highly competitive environment and therefore encourage developments which make the airport sector more responsive to the needs of their passenger and airline customers. Competition in the airline sector has been a driver of innovation and cost reduction and has delivered major benefits for consumers in terms of increased choice and value. Effective competition between airports is clearly something to be encouraged for the same reasons. “Within the aviation industry, MRO, ground handling, catering, CRS and freight forwarding created economic profits, but these were much more than offset by economic losses by airlines and airports. Airlines were responsible for the large USD17 billion of economic losses globally.
Nok Air has two major hubs located in Don Mueang international airport, which is a central domestic airport, and in Chiang Mai. A key competitive advantage that leads Nok Air to be the top budget domestic airline and to gain higher market share is using the product differentiation. Nok Air differentiates itself from other competitors in terms of routes and periods. The firm offers a variety of routes and periods to passengers to enjoy with Nok Air compared to other competitors in the market of low-cost airline. Expanding flying route is one of the firm’s strategies to serve more passengers.
Opening up of industry and availability of financial resources, reduces this barrier. Strong branding forces new comers to invest heavily on attracting customers from the present airlines. However, branding has not been very effective in keeping the customers in airline industry. Thus threat of new entrants in airline industry is high particularly in low-cost segments. Only very high efficient operations can keep the new entrants out of industry.
Jetstar would need to invest heavily in infrastructure and advertising. The other critical issue which could be a cause of failure in the international routes is “straddling”. Given the fact that the airline industry entry barriers are quite low for existing players, bigger airlines could easily copy the “Jetstar business model” and Jetstar would have to accordingly adapt its strategy through non profitable “positioning trade-offs” which could hurt its profitability in the long
Delta created its separate subsidiary in response to competitive threat of low-cost airlines. In addition, its subsidiary used pilots of its parent airline with independent decision-making authority. Does song have an effective strategy? Evaluate strategies by using three tests of effectiveness? Low-cost airline: Faster growth of low-cost aviation industry with homogenous service makes this industry fragmented across the United States.
Threats: FlyDubai just like any other business faces threats to its existence. For instance, with the global financial crisis and later the Eurozone crisis, the number of travellers has significantly reduced due to economic hardships. This has affected the profit levels of the airline as well as slowed down its growth prospects. The airline also faces intense competition from other low cost airlines forcing it to extensively invest in product differentiation to counter the competition. This is an expensive
The federal government’s absolute control over the TSA makes airline travel inefficient because adjusting the administration’s budget for more screeners, technology, and research is difficult and slow to develop. The security lines in airports are more often than not long and slow and there is no obvious solution that would make the TSA more efficient. Author Julia Zorthian of Time magazine claimed that the TSA blames passengers: “They carry on too many bags, which causes delays, and sometimes ignore small steps like having their IDs and boarding passes ready what would expedite the security process”. There is an unfortunate distribution of blame between the federal government and the consumers. The federal administration of airport security isn’t beneficial to either party; the federal government is responsible for drafting a budget of $7.4 Million dollars which adds to the national debt and the consumers are being subjected to inconvenient and intrusive screening processes (Zorthian 1).
Part 3: Results and analysis To answer question 1. An analysis of the business performance, and question 2, an analysis of business strategy SWOT Analysis Strengths BA has a strong brand, in 2015 BA retained its title as the nation’s strongest brand [Smithers, 2015]. In addition to the below strengths, this explains how BA managed to increase their revenue passenger kilometres (RPK) [Appendix 4. Figure 8] in the year due to being well known as a reputable airline in the market, thus resulting in an increase in profit. BA has a strong safety reputation and was ranked the fifth safest airline [Smith, 2017], this means that passengers would be more likely to fly with BA, as they will feel more secure about their safety during the flight, and result in an increase in passengers booking with BA [evidenced in appendix 4.
This company seeks to keep up its focused administration position and it actualized some forceful measures to enhance the efficiency for the organization like no more paying commission on flights booked by the conventional travel operators, merging its reservation operations focuses and persuading the representatives to keep on looking for the creative approaches to maintain the business better and easily. The test for the Southwest aircrafts is to stay with the way of life of the alive. As it keeps on growing and strengthens its part as driving prime time industry
Ultimately the goal is that Delta gets viewed along with other high-quality industrial companies like rail companies, and even to a certain extent the aircraft manufacturers. But it's just hard to make that today, given the multiple disparity and the volatility of the stock, it's hard to say that it's a real peer even though if you line them up on an ROIC standpoint and performance over the past couple years they look very similar. Limit it to Alaska and Southwest." Q12a - OE_PreferredInvestment Thinking about Delta along with its peers, which company is your preferred investment? "Delta and Southwest."