Africa Airlines Case Study

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Recommended: Strategic planning in the airline industry

As a consequence, SAA markets has gradually suffering from slack down recorded from the past three years dated 2012. SAA is finding itself difficult to sustain profitability due to reduction in passenger’s traffic and increased in operating expenses coupled with heavy competition burdened by competitor’s pressure. Customers are more than ever demanding a different and personalised relationship with the airline. SAA continues to operate in highly competitive markets. The growth and expansion in the airline industries has also been fuelled by the emergence of competitive carriers through capacity being added on several existing regional routes. Besides, Non-African airlines are also gaining the fifth freedom rights to operates between African …show more content…

To gain market share, it is clear that SAA cannot focus on profit deliverance alone. The game has changed and it is very important that we understand that today ‘customer and relationship’ are the driving forces for our business growth and success. It is one of the top-of-mind distinctive issues that SAA should be prevailed. However, since the past years, SAA is experiencing a continuous decrease in profitability and customer’s engagement. SAA is struggling to carry out a high standard of service. Yet, this leads to a lack of value added in creating a customer orientation organisation. The number of passengers opting to fly with SAA until now is continuing to be on a downward spiral, slipping to an overall rank. The SAA market is underperformed primarily due to the intense competition in offers and poor focused laid on customer loyalty and long-term engagement. The main competitors increase their seat capacity significantly and practiced various price undercutting. Emirates Airlines (EK) and Air Mauritius (MK) launched aggressively promotional campaign to revamp the business and to maintain their customer based with challenging approached that keep repeaters clients with extended network. From Figure 1.2 we can understand that MK maintains growth for the African in term of load factor moving from 58.6% in 2013 to 61.5%

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