Air Tran Revisado

7/27/2019 Air Tran Revisado

1/18


2/18

MISSION

Innovative people dedicated to delivering the best flying

experience to smart travelers. Every day.

VALUES

Safetyin every decision and every action, every time, every day.

Courtesy

Pride

Teamwork

Innovation

Service


3/18

HUMAN RESOURCES

Robert Fornaro Chairman President & Chief Executive Officer

Stephen Kolski Executive Vice President,

Operations and

Corporate Affairs

Arne Haak Senior Vice President of Finance,

Treasurer and Chief FinancialOfficer


4/18

SWOT

WT Strategies

Expand domestically (W1, W2,

W4, T3, T5)

Relocate main hub (W4, T3, T5)

ST Strategies

Advertise shared cost savings

due to fuel-efficient planes (S1,

T2)

Advertise new, safe planes (S5,

O4)

Expand short haul flights /

business class on west coast (S3,S4, T3, T5)

Threats T

Unionized workers / possible

strikes.

Rising Fuel Costs

Major competitors in same

market.

Society s view of flying after

September 11

Eastern / Southeastern weather

conditions.

WO Strategies

Expand domestically / West Coast

and Mexico (W1, W2, W4, O3,

O5)

Create another main hub other

than in southeast (W2, W4, O3)

Create cost efficient computer

reservation system (W5, O4)

SO Strategies

Expand more flights to west

coast / Mexico (S1, O3, O5)

Advertise business class to firms

throughout the country (S3, O3)

Advertise the number of

available seats to all of North

America (S4, O3, O5)

Opportunities O Appeal to public due to new,

safe, planes.

International Expansion.

Domestic Expansion.

Allow for computer reservations.

Negotiations between United

States and Mexico / possibly

more flights to Mexico

Weaknesses W

Only domestic flights offered.

Primarily east coast flights.

Among lowest rated for on

time performance

Heavy reliance on Atlanta,

Georgia

Net income dropped from 100.5

million to 12.3 million (2003-

2005 respectively)

Strengths S

New planes consume 24% less

fuel than old planes Has remained profitable despite

airline conditions

Business class on all flights

Additional seating in place of

galley / no meals are served

Average age of planes is 2.5

years

AirTran Airways

SWOT Matrix


5/18

CUSTOMER VALUE PROPOSITION

AirTran reward program

700 daily flights

57 destinations

Low Cost quality

Service Oriented

Response time

Real time desision -

response


6/18

STRATEGY PROPOSAL

AirTrans strategy is one of low cost within a narrow geographic

areaAtributes

, wide emphasis on cost

controls

Highlabor productivity

High asset utilization.

- 2aircraft types

- 86 Boeing 717

- A new fleet of 50 Boeing 737

Competition

- 2 new aircrafts

- Cost

advantage

- 1 old aircraft

- Cost

advantage

Low-cost


7/18

INCOME STRATEGIES

Auxiliary products and services

Optional fees for advance seatasigment

Call center fees

Pet fee

Alcoholic drinks

Excess baggage

Unaccompained minors

STRATEGY PROPOSAL

2005 revenue = 77 million dollar

Grow Client Value

Diffetentiaition Strategy

Web service

Free Xm Radio

Wifi availability in every flight

Premium beverages and food (paid)

Service quality


8/18

PRODUCTIVITY STRATEGIES

Market Penetration

Go after Dell, Southwest, and US Airways market share

Market Development

Concentrate on major vacationers, cooperate company trips,

tourists destinations with the help of package deals (hotels plus

flights) ect.

Joint Venture

Join with already established flight services in the West and

then gain more presence in the area.


9/18

PROPOSED ANNUAL OBJECTIVES

Continue rapid growth

Bidding on gates that become available at current hubs

Expand into new hubs

Increase revenues

25% per year

Increase efficiency

Cut expenses wherever possible while abiding by AirTrans beliefs

and values (culture of company)

Maximize passengers per flight


10/18

OPERATIONS COSTS ANALYSIS


11/18

Fuel is incrementing

Delta, Continental, U.S.

airways, Northwest, & United

declare bankrupcy

Some other stop operation

Greatrevenue

Market Share


12/18

CONCLUSION

Local Expansion

Purchase more fuel efficient planes which will increase the number of Non-Stop flights

Increase the number of promotions, and packages to new markets.

International Expansion

Purchase fuel efficient planes to travel international

Create contracts with international airports to allow Air Tran to land at theirairport. As a new venture, Air Tran should expand to South America,Caribbean, Europe, then further international destinations will be establishedafter Air Tran is stable in the international market

Establish connections with international tourist destinations, and createpromotional travel packages to introduce the new destinations that Air Tranwill help promote the new services that Air Tran will be providing


13/18

CONCLUSION

Advertising for Businesss

Establish contracts with various businesses to optimize the use of AirTran for their various business related tasks such as business trips,

shipping etc.

Set up a plan with businesss that would give them discounts on

tickets if they have all their employees fly with Air Tran


14/18

The end


15/18

LOW

COST

DIFFERENTIATION

STRATEGY PROPOSAL

How itsdifferent?

Business class en every airplane

Hube and spoke system

Student travel program Free Kraft snacks


16/18

SERVICE QUALITY

Direct Competition

2

12

3

6

1

10

23

0

2

4

6

8

10

12

14

Airtran Delta JetBlue Southwest

AxisTitle

Quality Comparison

2008 Vs. 2007


17/18

MARKET SHARE

American has the

highest domestic marketshare (14.3%), followed

by Southwest (13.0

percent),Delta (10.8

percent), JetBlue (4.3

percent), and AirTran

(3.3 percent).


18/18

DESTINATIONS

Air Tran Revisado

Documents

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