Airline Industry Situational Analysis Group B4 Ayanna Mills Chuck Newton Vicky Pan.
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Transcript of Airline Industry Situational Analysis Group B4 Ayanna Mills Chuck Newton Vicky Pan.
Airline Industry Situational Airline Industry Situational AnalysisAnalysis
Group B4Ayanna Mills
Chuck NewtonVicky Pan
Situation AnalysisSituation Analysis
Industry is at a turning point.Interrelationships between revenue
generation, cost structures and productivity, operational delays, and stringent security requirements are all major contributors to the current crisis in the airline industry
Critical ProblemsCritical Problems
Airlines Inability to Generate Adequate Revenue
Operating Costs and Productivity ProblemsOperations
Decreased Demand for Air Travel– Due to overall economic downturn
“Hassle Factor” – Increased passenger times due to increased
security requirements
Alternatives to Air Travel – Cheaper alternatives available
Revenue ChallengesRevenue ChallengesRevenue ChallengesRevenue Challenges
Congestion Related Delays– 15-20% reduction in airline capacity
Security Related Delays
Operating ChallengesOperating ChallengesOperating ChallengesOperating Challenges
Low-fare AirlinesLabor and Management RelationsIncreased Labor Negotiation Process
Cost ChallengesCost ChallengesCost ChallengesCost Challenges
Improve Customer ServiceEntrance into Discount Airfare MarketAchieve Meaningful Labor Cost DeductionsProductivity Improvements
OpportunitiesOpportunitiesOpportunitiesOpportunities
SWOTSWOT
Strength Weakness
Opportunity -Strong Cash Reserves -Brand
Recognition -Terminal Rights
at Busiest Airports
-Inability to Generate Revenue
-Cost Structure and Productivity
Threat
-Health and
Safety -Alliances
-Lower Demand for Air Travel
No Single Solution to Current Airline Industry Situation
Inability to generate Revenue due to security concerns
Perceptions of Poor Service Increases Attractiveness of Low-Fare Airlines
ConclusionConclusionConclusionConclusion