Russell Investments Case Competition
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Transcript of Russell Investments Case Competition
TIMELINE
2017
• 5th Freedom Agreements and flight traffic across Pacific
• 9th Freedom Agreements attained for South Africa Terminals
2018
• 5th Freedom established between Ireland and the USA
• Flights running between DC and Dublin
2019
• Cargo terminals in South Africa ready for operation
2020
• Fully functional South African cargo routes to Johannesburg and Dubai
2021
• Track progress from all new air routes
S. Africa Alternatives
1. Middle East: Saudi Arabia and Qatar
i. Expected growth for cargo
2. To and from Russia and South America
i. Expected increase in cargo traffic
- Services market of wealthy clientele in all connecting
cities (clear demographic)
- Builds on existing route so it will be a less expensive
plan to implement
- High profitabillty
- Doesn’t conflict with Fifth Freedom Right for air travel
- Not enough demand for new route
- Governments don’t cooperate- Emirates have fewer transpacific flights
- Access to more travellers in the fastly growing Asian
economy
- Plenty of other companies do similar routes
- Not enough demand for route
- Conflicts with previously unforeseen regulation
- Added bonus for this specific route?
Trans-Pacific Route
- Competition from United and Air Lingus for same flight
path
- Slightly unstable political scene in Ireland
- Dublin is smaller airport than some cities
- Dublin is a gateway into the rest of Europe
- Ability to compete with Turkish Airlines for local flights
in the future
- Expansion of routes across Atlantic
- Get into fast growing Dublin airport
- Introduction of Emirates-level service for this route
- Location is near a lot of major tourist/political/business
destinations
- Dublin has a growing economy (rebounding from 2008
Crisis)
Trans-Atlantic Flight
- Not having routes already established in these areas
- High competition in those areas from other airlines
- More expensive in short run with building terminals
- Governmental regulations (9th freedom rights)
- Growth in Africa = increased shipping demand
- Increased freight routes that can service the Middle
East and Russia
- Building upon pre-existing routes = cheaper
- Playing on shipping strength
- Expansion into smaller cities for
South African Freight Routes
Summary of Points for “Safina” Space Program
Reasons for Exploring this Opportunity:
Exclusivity: No airline offers this service
High speed travel to any destination
Huge increase in goodwill
Original Plan:
Sponsor Virgin Galactic or UAE Space Program
UAE has already invested $5.4 billion
Increase ticket price targetting VIP clientele
Start services around ~2020
Problems We Ran Into:
Emirates is not a production company
No guarantee Virgin Galactic will partner
Most likely a sunk cost
Significant danger involved