AirAsia

History of AirAsia:established by DRB-Hicom Berhad in late 1996The death of Tan Sri Yahaya Ahmadmanagement and financial crisis 8th December 2001, Tony Fernandes had taken over AirAsia with RM 1 (40mil)7 month in operation, gained RM 113 million Going public on 2004 and got its own airport on 2006

The quantity and types of planes• AirAsia has 135 planes which are operating for both domestic and international flights• Various types of planes - Airbus 320-200, Boeing 737-200, Airbus 330- 300, Airbus 340-300, and Airbus 350-900.

AirAsia promotional tools• Magazine• Newspaper • Internet and Email• Merchandise

Air Asia Present Strategy

Success of Air Asia

1.A low-cost carrier among the airline industry - Offer low fare for all destination around the world.

2. Low operating cost - Have a very lean organization structure and operating costs are

kept to the bare minimum with low wages.

3.Management strategy Maximize shareholders value- Profit creation by expending business reach within Asia and

Europe

Focus on customer needs- No fuel charge, customers just need to pay tickets price and tax- Comprehensive distribution channel Operation excellence - All staffs are contribute-no ranks or hierarchy - Performance based remunerations and incentives

5. Pricing strategy- Air Asia using randomized pricing strategy and this strategy to

increase the market demand and profit maximize- With a randomized pricing strategy, a firm varies its price from

hour to hour or day to day basic, consequently. When a firm randomly changes the prices of their goods, consumer cannot learn from experience which firm charges the lowest price in the market

6. New routes and frequency of flights

- Air Asia airline now introduced new flights routs to countries around the world.

- increases the frequency of flights for certain destination not only in Malaysia but Asia countries too. For example frequency flights to KL to Jakarta increased to seven times per day.

Failure of Air Asia

1. Flight delay complaints from passengers - Air Asia passengers start to complaint about the delay of the

flights for certain destination.- passengers have to wait for the flights for long hours and this

make them feel not comfortable

Future OutlookTechnology Innovation

AirAsia can learn from MAS’s iFly servicesOffers a remote check-in service in more

languagesReplace the self-service check-in kiosks with PCs

and printers Business Expansion

Venture into the cargo business Emphasize more on customers from Japan and

KoreaImprove its influence in the European market

Brand AwarenessUsing corporate social responsibilityIntroducing flights powered by bio-fuel Advertise more in other countries

ConclusionAirAsia is a leading low fare airline in the

Asia.Has expanded rapidly since 2001.The products of AirAsia have entered into

growth period in the lifecycle.More customers are familiar with this brand.Low cost products are easily acceptable for

customers and thus, AirAsia is able to occupy more market share and increase its revenue.

The management should pay more attention to sustainable development and the trend of consuming in the tourism market.