These costs are considered to be the major expenses within an airline industry. What opportunities exist in the Asia-Pacific region for the entrance of new low-fare airlines?
Air Asiamust pay attention to this, not having its own MRO facility is a competitive disadvantage. Therefore, customers can switch to other airline easily. AirAsia and its subsidiaries need to take an awareness of environmental factors. Hence, as an investor or business man, they will choose more reliable airlines instead of AirAsia.
It derived the majority of these revenues from checked baggage, on board food and drinks, merchandising, seat assignments and travel insurance.
For Air Asia, it is subject to intense regulatory scrutiny by Environmental Protection. The more people are employed in cities over 15 million people, the more need there will be for journeys to homes in the countryside.
Seats are available at various prices at various points in time.
Malaysia is expected to slow down economically inas well as Thailand and Indonesia. Therefore, it can increase the demand of travelling. Apart from using the brand new A, fuel efficiency is achieved through operational discipline — managing aircraft weight, flight planning, maintenance and engine care, and optimal landing and taxiing techniques.
Together with increased in trade and tourism within and into Asia, demand for air travel increased; more people were willing to compromise on food and other services in exchange for lower prices.
Air Asia to achieve the targeted cost effective marketing through advertising. Therefore, they can reduce the cost of training. The aviation industry has recently become under pressure with higher fuel costs and consumer awareness of the environment in particular. Substitutes and Compliments Sometimes the consumer is not so much interested in the main product for some reasons.
Threat of terrorism, people are afraid to fly after the September 11 terrorist attacks incident. Limited number of aircrafts supplier.
The airline industry offers similar service. This is only the second ever full democratic election in Indonesia and tensions have been running high. AirAsia wanted to become a company that worked on the basis of the average man in the street being able to afford our air fares, and people who would not have considered flying, or would not fly as often as they as do now.
With their strong working relationship with Airbus, they managed to get big discount for aircraft purchase which is also more fuel efficient compared to Boeing planes which is being used by many other airlines.
The longer the route, the less price-sensitive the passenger becomes. In this case, even Air Asia always provide lowest price to customers, but they still will make comparison between airlines.
This everyman CEO insists, contrary to Asian cultural norm, that any employee in the company has the ability to climb the ranks to the top. There are few low cost carriers such as Firefly, Tiger Airway and etc which makes their services provided weak differentiation.Apr 01, · Air Asia faces increases challenge while operating is business outside Malaysia due to bilateral agreements.
Bilateral agreement is one of the major obstacles for the growth and development of low cost carriers in the Asia-Pacific region/5(K). Yield and profitability would decrease for AirAsia if fuel prices become too high.
Overall, although such economic events are unavoidable, the opportunities outweigh the threats, presenting AirAsia opportunities to expand its business: during times of economic downturns, demand for affordable low fares would increase amongst budget-conscious.
Tony Fernandes enrolled low-cost airline experts to restructure the business model of AirAsia. He invited Connor McCarthy, formerly the director of the group operation Ryanair, to join his executive team. Jun 03, · Air Asia is a low fare airline of Malaysia, it had one of the largest number of airplanes and flying destinations.
Know what Business Strategy made Air Asia a successful low budget Airline in Asia. According to AirAsia, the key to delivering low fares is to consistently keep costs low – which requires high efficiency in every part of the business, with every system process incorporating best industry practices.
Strengths Low cost operations AirAsia Berhad is the first airline company that offered a low cost flight in Asian market. By operating the low cost principle, AirAsia Berhad aim to maximize their sales and minimize their operating cost.Download