Low cost carrier and air asia essay

Strategies are extremely important as they chart the future prospects of the airline. Diverse sectors were comprehensively deregulated such as air transport. Standardization one jet type in use No frills extra services are not mandatory Low labor expenses, no unnecessary cost Adaption to Asian market: Due to the ease of strategy replication, new entrants may emerge in the South East Asian short-haul market.

With its growth, AirAsia could expand its resources and enter into the air shipping market where it would likely turn a profit by exploiting its strong capabilities.

Accessibility of services extensive use of mobiles in Asia A low-cost strategy meets high demand Barely competition within short-haul, low-cost segment Marketing strategy: Lastly, due to the highly competitive nature and over saturation of international airlines, AirAsia may not realize the same aircraft utilization in long-haul flights as it does with short flights.

Furthermore, the airline needs to shift attention on the available resources and align them in such a way that there is guaranteed benefit on its objective of maximizing profits.

The ascendance of AirAsia: Building a Successful Budget Airline in Asia Essay

Long-haul flights will require more time in the sky with flyer layovers and a less streamlined flight schedule. They all have come out with different strategies to make their company better than their competitors. The key in providing upgraded seats is to ensure customers feel as though they are receiving an extra value and to help retain customer base and market share as regional economics improve.

The Asian air travel was thus full service in nature and intercontinental. Furthermore, such expansion places AirAsia in direct competition with government backed Malaysian Airlines pg. Nevertheless, there was a question as to whether the many entrants would survive in the long-term.

An Integrated Approach, 10th edition. By implementing low cost strategies, AirAsia was able to capture and capitalize on the underutilized segment. Therefore, it became important for deregulation and liberalization to be undertaken in order to provide a means for Japanese air travel to register some further growth.

Another issue AirAsia may face should it overly focus on airline expansion is the fact that barriers to entry in South East Asia are relatively low. Short regional flights allow AirAsia to serve a greater number of flyers over a shorter period of time at a lesser cost example: Some of the most important strategic alignments that AirAsia need to undertake are to do with procurement, resource development as well as sustainability of the important resources necessary for the growth of the airline.

Building a Successful Budget Airline in Asia Essay An analysis of the business environment of Asia indicates a continuous growth and expansion of the economy. By then, the market had experienced some reasonable level of maturity and therefore assumed a plateau state.

Real boom on low fare airlines was actually registered in Japan at domestic and international levels. Asia saw an unprecedented entry of LFAs.

There was an enormous customer base but the regulatory environment in Asia did not keep at pace with the demand for LFA services. In this regard, AirAsia needs to focus serious attention on the nature of the aircrafts procured.

Although this strategy is ideal for AirAsia as a short-haul LLC, it is not transferrable to long-haul flights.

Anti-cyclical marketing to keep demand stable Brand building through sponsoring Williams Formula 1, soccer teams Enforcing coverage in the media Sales: The strategic focus of the airline has shown that there is immense potential for enormous growth by massive rates. AirAsia has developed a specific set of resources and core competencies that it has exploited in order to become the leading short-haul LCC in South East Asia.

Case Study: Air Asia

The market was actually controlled by airlines offering traditional full-service air travel. AirAsia also has to compete with other airplane companies which always come up with new strategies as to compete.

Problems and Challenges Faced by AirAsia Paper

The Malaysian air transport was highly regulated thus a major hindrance to full growth. How to cite this page Choose cite format: Competitive Advantages AirAsia 4 pages words This is a preview content.

To sum up, every company has their own kind of problems and challenges they faced whether it is hidden or visible and whether it is known or not. View Full Essay Teaching Cases: However, there was significant growth potential of LFAs in Japanese air travel. Unfortunately, due to industry saturation in international long haul flights, AirAsia would have to fight to obtain a strong customer base from established airlines by providing actual or perceived value while trying to maintain cost and utilization optimization.

Should new LCC airlines being to emerge in this region, AirAisa may experience a reduction in market share reduced number of passengers and fierce price competition where AirAisa cuts ticket prices resulting in reduced profit margin.

However, as a cost savings measure AirAsia utilizes secondary airports resulting in a competitive advantage.In this essay, I will discuss on the environmental problem caused by air travels and the increase in fares to discourage people from flying of cheap air travels.

Due to vigorous development of aviation, airways constantly continue to expand their market by providing low-cost air travels for low-income passengers. 4 A brief history of low cost carriers In the United States In the post World War II period, commercial air travel in the United States was heavily regulated by the federal government.

Introduction of Air Asia AirAsia is Asia’s largest no-frill and hassle-free airline which based on the low cost carrier (LCC) concept in Malaysia. AirAsia is a low-cost airline based in Malaysia. It has been declared World’s Leading Low-Cost Airline two years in a row.

It has also attained the tittle of Asia’s Best and World’s Best Low Cost Airline by Skytrax for six consecutive years from until AirAsia established in and start the operations on 18 November (Wikipedia, ) Inspired by the success of Ryanair and EasyJet as low cost carrier, Toni Fernandes saw the potential of having the same concept in Asia.

AirAsia should put more effort to set up a pan-Asian low cost airline with Virgin Blue, which is a low cost carrier of Virgin Group serving Australia and New Zealand mainly. Virgin Blue has suggested it may extend services to south-east Asia.

Low cost carrier and air asia essay
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