.

Sunday, May 17, 2020

Characteristics Of An Airline Industry - 1071 Words

Delta Inc. - Characteristics of An Industry â€Å"Delta Air Lines is one of the world s largest airline carriers in the world. Through its regional carriers, the company serves about 330 destinations in about 60 countries, and it operates a mainline fleet of 800-plus aircraft, as well as maintenance, repair, overhaul, and cargo operations† (Hoover’s Inc., 2017). When analyzing the airline industry, it is important to look at the dominant economic features of that industry. The air line industry is considerably large and has reached its’ maturity stage; it is not really growing or declining. There are many independent companies within the industry and some are bigger than others; such as Delta, American Airlines and United, but even smaller†¦show more content†¦Because the airline industry requires a lot of money and other financial resources to provide its’ type of service, it is very capital intensive. Because of Delta Inc.’s capital-intensive nature and fixed costs, barriers to ent ry are low. According to the IATA (International Air Transport Association), about 1,300 new airlines were established in the last 40 years (Cederholm, 2014). Capital is not the only reason there are low entries into the industry: sophisticated knowledge and skill sets can be a challenge when trying to fill positions, and there are many federal and government regulations and laws that must be adhered to which can be a deterrent during initial start-up. Market Share. The passenger air transportation market is a thriving industry, taking individuals to locations around the globe. In 2015, Delta Air Lines was the largest airline in the world based on sales, reaching more than 40 billion U.S. dollars in sales revenue. In 2016 Delta Inc. had a big fall in earnings. Increased costs from a new pilot contract drove the bulk of the year-over-year decline, with a decrease in unit revenue doing the rest of the damage. Conversely, â€Å"Delta expects passenger revenue per available seat mile (PRASM) to return to growth in Q1 for the first time in more than two years. If unit revenue remains on its upward trajectory this year, the company could return to margin expansion by the second half of 2017† (Levine-Weinberg, 2017). Strengthening passengerShow MoreRelatedPorters Five Forces - the Airline Industry1238 Words   |  5 PagesAbstract In this paper I will be analyzing the airline industry using Porter’s Five Forces. Porter’s Five Forces is a business management tool that allows firms to possess a clearer perception of the forces that shape the competitive environment of an industry, and to better understand what these forces indicate about profitability with regard to the microenvironment. The forces include Competitors, Threat of Entry, Substitutes, Suppliers, and Customers. When firms are able to widen their conceptionRead MoreCurrent Situation of Airline Industry1122 Words   |  5 PagesCurrent Situation of Airline Industry Since the airline industry was deregulated in the late 1970s, they shall hold the line on the number of planes they fly. The result is that the people by plane shall be more and more, and the fares shall become expensive. Because air transport is faster than other transportation methods, the people increasingly prefer to fly. The air transportation shall be an important transportation method in the future, and the people engaged in air transportation shall haveRead MoreOligopoly Behavior in the Airline Industry. Case Analysis647 Words   |  3 PagesOligopoly Behavior in the Airline Industry. Case Analysis This case illustrates the pricing behavior of firms that are oligopoly whose market is characterized by the relative few participating firms offering differentiated or standardized products or services. Such firms in an oligopoly have market power derived from barriers of entry that wards off potential participants. As seen in the case, it is clear that because there are a small n umber of US Airlines firms competing with each other, theirRead MoreMarketing Plan For A Company Essay1601 Words   |  7 Pagesanalyze the industry in which your selected Company/Brand operates. For example, Coach operates in the luxury handbag industry. 1 - Using outside sources (cite and reference each source), provide an analysis of the industry. Include specifics on competing brands when possible. Ideas of information to search for: market size/growth rate, industry sales, market share among competitors, current trends, consumer characteristics, product differentiation strategies, and other similar industry data. IndustryRead MoreThe International Air Transport Association Essay1519 Words   |  7 Pagesapplies particularly to the competitive aviation industry. It has evolved rapidly since the first commercial flight in 1914 (Johanson, 2014). Airlines need to rival on various facets such as fares, services, products, routes, schedules, frequent flyer programs and customer service in order to gain a competitive edge (Hussain, Nasser Hussain, 2015). According to the International Air Transport Association [IATA], (2016), who represents 265 airlines, a total of 3.5 billion passengers traveled in 2015Read MoreCorporate Culture Southwest Airlines1276 Words   |  6 PagesDiscuss the corporate culture at Southwest Airlines and how it leverages its culture to achieve a competitive advantage. The corporate culture at Southwest Airlines can be defined within three areas including, core value, management style, and compensation. Southwest Airlines organization structure incorporated several areas but I was impressed with these three the most. Southwest Airlines had two core values, which emphasized on LUV and fun. Not only was LUV the company’s signature symbolRead MoreThe Merger Of U.s. Airways And American Airlines1170 Words   |  5 PagesSince the merger of U.S. Airways and American Airlines, most people would now agree we are living in the age of airline oligopoly. Oligopolies form when there’s a state of restricted competition, and new companies cannot break into the industry for reasons like high-entry costs or government restrictions. This is the condition of the airline industry, today. In order to breach the oligopolistic nature of the airline industry, airlines must be able to break through high barriers to entry such as:Read MoreSkywest Case Study - 5 Forces Analysis Essay794 Words   |  4 PagesInc. 1. The dominant characteristics of the U.S. regional airline industry are they are mostly controlled by larger airlines or have a contract with them to secure flights. . Most regional airlines are there for smaller communities to access a flight to the major hubs. Most of the regional airlines service to major airports, so they are connected or part of a servicing contract with national airlines, who in turn are part of the operations of the global airline industry. Smaller aircraft and retiredRead MoreSouth West Airline919 Words   |  4 PagesWhile the major airlines in the United Stated were making a lost of approximately $8 billion, Southwest was the only airline company that was profitable as well as facing a rapid grow-with a 25 percent sales increase in 1992. In 2005, Southwest was the sixth largest airline in United Stated. The success of Southwest is mainly linked to its pricing strategy, it positioned itself as a low-price, short hauls and bare bones operation. There are numerous distinctive characteristics that had lead toRead MoreBusiness Strategy Tools1065 Words   |  5 Pagesseries of fundamental business strategy tools (including industry analysis, competitive strategy and resource and capability tools) and techniques to the formulation and analysis of value creation and capture at a strategic level. Porter 5 Force analysis Porter framework assumes: 1. industry structure drives competitive behaviour 2. Industry structure is (fairly) stable. [pic] Case: Airline Industry †¦. Porter’s 5 forces – purpose: Identifying the different

No comments:

Post a Comment