Introduction
Air India airline is one of the biggest airline in the India. It was established by the famous company TATA and since its incorporation. It has grown very well and has spread all over the world in the different destinations. It has become the reputable brand in the airline industry with having the operations over 152 destinations. It has link up connection in the 35 countries and it has currently having 137 fleets. This company becomes the public limited company in the 1946. The company has international and the local route and its performance is increasing day by day with the pace of the good growth as compare to the other airlines in the industries in the area and the channels in which this airline is working.
External factors affecting the Air India
Every company in the market has to face the different challenges and try to cope with the challenges to come up with the strong idea to stay and survive in the market. Market is getting tougher and there are different factors which effect on the company policies and the strategies which the company is looking to apply. Some factors can be managed by the skills of the companies and can be tackled. These factors called internal factors but there are some factors which are very hard to tackle. They are out of control of the company but the alternative actions can be taken to avoid the consequences of the impacts. To analyze the external factors which are affecting the Air India airline, the pestle analysis can be used.
PESTEL analysis:
Pestle analysis is the tool to analyze the external environment of the business. It takes the different factors according to which the opportunities and threats can be analyzed and the actions plan can be made.
Political factors:
In India, ...
... middle of paper ...
... culture.
Stakeholders’ analysis on Air India:
Stakeholders’ analysis is the analysis which tells that how the company is dealing with the people which are directly or indirectly related with the company’s operations. These are called stakeholder and they include the employee, society, suppliers, buyers, shareholders, got and other tax related companies.
Air India has gone through this process very strongly and it is very committed with society and on every big event, they are providing the reduce price to keep the customers with the company. On the other hand, this airline is providing the huge income to the economy as the tax for which got has recently accounted to provide the less tax on buying new fleets. Company varies with the suppliers as the supply of fleets is not often therefore company focuses on the different suppliers which provide them the best price.
American Airlines and US Airways are in the aviation industry. Both companies provide air transportation services for passengers and freight. Together they have formed American Airlines Group, Inc., the world’s largest airline, as measured by revenue passenger miles (RPMs) and available seat miles (ASMs). In 2012 the U.S. airline industry was worth approximately $195billion in operating revenue, up from $154billion in 2009, including an operating fleet of 3,451 aircraft.1
First of all, the power of suppliers under the Qantas Airways Limited is stable, which their supplier is a world’s fuel price for their airlines, self-supply fuel and large in their economy of scale. Then for power of customers, is also stable because the Qantas Airways Limited has already built a reputation for excellence in their safety, operational reliability, engineering and maintenance, and customer service. With that strength can opportunities for them to increase the power of customer, automatically it can be a comfort and the first choice for the customers to the services that given, especially when Qantas Airways Limited can put or offer a better price than other competitors that similar like
In lights of the PESTLE model, the political factors bring both opportunities and threats to Jetstar’s new proposal. Since this proposal focus on the Australia-India low price airline market, the analysis conducts involving Australia and India political environments. There are two potential opportunities in this political environment. Firstly, the Australian government has the incentive to boost the development of tourism between the two countries (Tourism Australia 2012). With the support of government, the start of the new route could be easier. For example, American government erects legislation to increase competition of the airport ‘by forcing these airports to increase the availability of scarce facilities’ (Williams 2015). Such legislations and regulations as well as financing investment or subsidies from government could directly help the airline company cut the cost. Similarly, Australian government could also have powerful intervention to influence aviation market. Thus, it is a big opportunity for Jetstar to the new route expansion if it acquires the
These factors are typically associated with uncontrollable external factors that affect the company. It is easy to accidently include weaknesses of a company as a threat, however, if they are internal factors they will only be included in the weaknesses section of the SWOT analysis (Parnell, 2014). Opportunities and threats can be determined by conducting a PEST analysis. A PEST analysis is the analysis of the political, economic, social, and technological forces that affect the activities and performance of a company in the environment in which it exists (Jurevicius, 2013a). Other things that may be considered opportunities or threats are future business trends, changes in the culture of the firm, the economy, demographics, changes associated with the physical environment where the company is located, and governmental
PESTEL analysis is the technique where political, economic, socio-cultural, technological, environmental, and legal factors are evaluated to identify external forces that impact market’s growth or decline. Assessment of the external environment helps to recognize key drivers and create a development strategy for the company.
In the 1990s, Emirates airlines began to expand its route network to various international destinations including Paris, Rome, Zürich, and Jakarta. With the advancement in aeronautical engineering, long haul flights became more frequent which lead to the airline's route expansion and earned it the name, “finest in the sky”. By 1994, the airline had 4000 employees and netted a profit of about 24 million dollars (The Emirates Story).
During 19991-1992, Modiluft, East West and Damania went bankrupt. Air Sahara and Jet Airways survived along with government own Indian Airlines because they had the capability to bear losses. Globalization and privatization had a major impact on aviation industry. Indian aviation industry was deregulated by the government in 1990s. As a result now 14 airlines are operating today in Indian sky. Now, collaboration with international organization and foreign direct investment are welcome to improve infrastructure and technology. Today people who can not afford high prices of Full Service Carriers (FSC) can travel by Low Cost Carriers (LCC) or budget airlines. Air Deccan was India’s first LCC started in 2003. It flies to several metro and non-metro destinations. All airlines have three major fixed costs i.e. fuel costs, financing or aircraft lease and labour cost. But LCC costs are 10 to 15 per cent lower than FSC. This is because of three reasons. Firstly, saving on distribution cost as passengers book tickets on the internet. Secondly, no frills are offered on board. Thirdly, to accommodate additional seats, catering and cabin crew space in these aircraft has been used. So these aircraft have 40 seats more than the FSC.
AirAsia Berhad (AirAsia) is a leading Low-Cost Carrier in the Association of Southeast Asian Nations (ASEAN) region. AirAsia focuses on providing high-frequency services on short-haul domestic and international routes. The main goal of this paper is to analyse the business strategy of AirAsia as a low-cost airline. This paper aims to apply the management process of strategy and analyse the three levels of strategy by which AirAsia is able to maintain its reputation as the top Low-Cost Carrier (LCC) in Asia. This paper will then show how innovation is a key aspect in AirAsia’s strategy, and will finally consider the external environment framework in which AirAsia is succeeding.
The current global competition among businesses has attracted an environment where companies or organizations must devise all the possible ways in order to make the most of profits and also ensure growth by concentrating on the strategic marketing methods. A good example of a competitive business is Classic Airlines. The company has the potential to change the general outlook of the airlines business. As a way of guaranteeing its success in the airline industry, the company must be in a position to suitably predict the market capacity as well as the impending demand through the creation of long-term marketing goals.
The low cost operations, effective ,management level, and aggressive management .There are offers low-cost and affordable airfares and offers in-flight services that promote Malaysian hospitality and a huge variety of the local food.The Air Asia company also supply a simple proven business model that systematically delivers that lowest fares. Air Asia serves a canonical need of their passenger, getting from point 1 to point 2,its business models derives from Southwest Airlines, Ryanair and Easy Jet. Air Asia’s “No Frills” module means deduce the unnecessary offering such as air-flight meals,less room baggage allowance,and reduced seat pitch.Besides that,Air Asia get through to volume markets.By using the common fleet, Air Asia reduces the cost of training cabin crews and pilots as it is more easier to move them around and the floor plan and layout remains the equal.There have multiple skilled of the staffs means they are efficient and motivational workforce.Besides the common of social media advertising , Air Asia’s top management also take advantage and benefits on marketing activities through news by being very “media friendly” and free contribute and sharing the latest information and details on Air Asia as well as the airline manufacturer. Their partnership with other service providers such as hotels and hostels, car rental company, hospitals (medical tourism), Citibank (Air Asia Citibank card) has created a vary new image among traveling. Alliance with Galileo GDS (Global Distribution System) that be able travel agents over the world to check flight details and information for makes bookings have also chip in to their brand’s name.Air Asia is the lowest cost leader in Asia. With the utility of Air Asia Academy, Air Asia has successfully created a “low cost airline mentality” among their workforce. The workforce is very flexible
Jet airways India’s second major airline in terms of market shares after Indigo airlines based at Mumbai known as India’s economic capital in addition to being its India’s widest network with 3000 flights a day with 76 destinations worldwide, main operations are handle from Mumbai but secondary hubs are Delhi (Nation Capital of India) Kolkata and Bangalore, It has an international hub at Brussels Airport, Belgium.
A PESTEL analysis is a framework or tool used by marketers to analyse and monitor the macro-environmental (external marketing environment) factors that have an impact on an organization. The result of which is used to identify threats and weakness which is used in SWOT analysis. (Professional Academy n.d.)
The first step to doing an external analysis on General Electric is to conduct a PESTEL Analysis. PESTEL is an acronym for political, economic, sociocultural, technological, ecological, and legal factors affecting a company. Using the PESTEL model, it is easy to evaluate external factors that could possibly have an effect on the company.
Historically the Airline industry is one of the most competitive fields today. The large number of players in the industry combined with falling profit margins intensifies the competition. High exit barriers and mergers among competition makes it extremely difficult to growth in the industry
A PEST analysis is an analysis of the external macro-environment that affects all firms. P.E.S.T. is an acronym for the Political, Economic, Social, and Technological factors of the external macro-environment. Such external factors usually are beyond the firm's control and sometimes present themselves as threats. For this reason, some say that "pest" is an appropriate term for these factors. Let us look at the PEST analysis of the Indian aviation sector: