strategic analysis -air asia case study
TRANSCRIPT
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NonstopWorldWebsite: jennifervuhuong.com
Microeconomics & Strategy
Case study: AirAsia
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Contents
Microeconomics and Strategy
Market structure and industry analysis
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Airasia: An overview
• Vision: To be the largest low cost airline in Asia
• Strategy: – Safety First– High Aircraft Utilization– Low Fare, No Frills– Streamline Operations– Lean Distribution System– Point to Point Network
• Business Model: Low-cost-carrier
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PEST analysis: AirAsia
http://www.free-management-ebooks.com/dldebk-pdf/fme-pestle-analysis.pdf
Macro-environment
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PEST analysis: AirAsia
http://www.free-management-ebooks.com/dldebk-pdf/fme-pestle-analysis.pdf
Bilateral agreement Landing charges Threat of terrorism
Competition Current recessionOil prices
Customers’ reluctance to enter cheap airline with long flights Increasing world's population, tourists and number of educated people
- Online service that combines air ticketing with hotel bookings, car hire and travel insurance/GO Holiday- Upgrade the planes
Politics
Economy
Society
Technology
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Porter’s Five Forces: AirAsia
The market – competitors
The organisation
Figure 2.1 Exploring Strategy, Scholes et al
Potential entrants
Threat of entry
Buyers
Bargaining power
Substitutes
Threat of substitutes
Suppliers
Bargaining power
micro-environment
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Porter’s Five Forces: AirAsia
The market – competitors
The organisation- Rivalry with
competition – high
Figure 2.1 Exploring Strategy, Scholes et al
Potential entrants: High
Threat of entry
Buyers:High
Bargaining power- Offer cheaper flights with better quality compared to similar competitors
Substitutes: moderate
Threat of substitutes
Suppliers:
moderate
-All airlines seem to have same two options – Airbus or Boeing -Airasia order Airbus form of airplane so benefits of airbus will be influenced by airaisa
-High capital to set up new airlines-Brand awareness (to create brand loyalty by making huge investments to establish their reputation)-The government legislation to get new routes(Air Asia has always been close to the governments in South Asia)-Government policy limited the New entrants so AirAsia is settled
Bargaining power-Depends on the distance to travel and the price -Once customers fly with airasia, they may choose again even with shorter distance and a little bit higher price
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Porter’s Five Forces: AirAsia and now
• Potential entrants – Now less threat because more
tourists/educated people are willing to pay for cheap flights with guarantee of safety/less luxury
• Most busiest routs – Airasia shouldn’t compete with national
routes but international routes – Example: flights from Japan to the USA
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References
• https://www.ukessays.com/essays/marketing/pest-and-swot-analysis-of-airasias-international-business-operations-marketing-essay.php
• http://www.slideshare.net/mariammana/task2-tc644mariam-afsharp67787
• http://centreforaviation.com/analysis/airasia-x-long-haul-low-cost-service-to-the-us-will-provide-an-important-test-for-the-asian-model-218201