Strategic analysis -Air asia case study

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Microeconomics & Strategy

Case study: AirAsia


Contents

Microeconomics and Strategy

Market structure and industry analysis


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


PEST analysis: AirAsia

http://www.free-management-ebooks.com/dldebk-pdf/fme-pestle-analysis.pdf

Macro-environment


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


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


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


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


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

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://www.slideshare.net/mariammana/task2-tc644mariam-afsharp67787

Strategic analysis -Air asia case study

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