Case Analysis Of Qantas Airlines

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The airline Industry in Australia is struggling to make profits, and this is seen by the market performance of Qantas Airlines. In fact, for a number of years, Qantas Airlines is struggling to make profits, and it faces a decline in the share of its market. Certainly, the airline industry in Australia is struggling to be profitable as a whole. On average, the airline companies in Australia are making about 1-3% in terms of profit. Of course, it is not only ion Australia that the airline industry is on a decline. The decline is witnessed all over the world, even in the United States, where the market is established. For instance, the average profit that American airline companies are making is 5%. This percentage profit is very low, compared…show more content…
A pricing policy that benefits the company is one that does not lead to losses, or low profits that cannot sustain the organization. It is important to note that in a s much as cost leadership strategy, is one of the most efficient strategies that can lead to profitability of the organization, the company must provide high quality services, to be guaranteed of customers. This is because customers are prepared to pay a significant amount of money for a quality service. Furthermore, the BlueJet must know the demand elasticity of the different market segments, as this is an important factor that determines the pricing policy of airline…show more content…
Because of these policies aimed at capturing customers, there is an intense competition in the airline industry. Indeed, entry of low cost airlines has shifted the advantage to these airline companies. In fact, a company such as Tigerair is emerging as a leader in offering low cost air services in Australia. Other potential competitors include Airnorth, Rex Airlines and Jetstar. BlueJet has to study the pricing and managerial policies of these competitors, for purposes of ensuring that it comes up with the best marketing strategy that will give it a competitive edge over these rivals. It is important to denote that without information about these competitors, BlueJet may initiate policies that may not be effective in penetrating the market segment held by these

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