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Copy of AirAsia
Transcript of Copy of AirAsia
Armando Silva Ryanair easyJet Southwest AirAsia's Value Proposition Tony Fernandes' Mission After seeing a advertisement for Easyjet, Tony realized flying consumers aboard a no-fills low-cost airline could be applied in Southeast Asia. Days after signing a deal to take over AirAsia,
9/11 terrorists attacks forever changed the Airlines Industry. The timing of the Start-up in the aftermath of the tragic events ensured the lowest possible cost structure.
Operating Costs "People Strategy" "Operational Strategy" "Branding Strategy" Tony recieved help from experts in the business of low cost airlines including Ryanair's former director of operations, Conner McCarthy. This spurred his entreprenial strategy, But... Tony wanted to make sure that “his own unstuffy, open and cheerful personality,” resonated throughout AirAsia So Tony and AirAsia transformed existing strategies to form a strategy that can function in a region with a large population and moderately low income. Did Tony weigh all political, economic, and operational risks when taking over AirAsia? So... What risks might have he overlooked? Tony executed the appropiate strategy when entering the Southeast Asian market.
Took Coner McCarthy's advice to "stay closer to home"
Permission from the Prime Minister secured backing of the Malaysian government.
Worked accordingly with the government and political figures
Reductions of the operational cost
Accounted for Economical Factors
Reasons why he did.... The rejection of secondary airports by government officials
Expanding too fast could lead to disastrous results by not meeting the demands and ultimately leads to decreased economies of scale Can new low-Fare airlines Survive? Contributing Factors to their Survival As econonic growth continues, so does their ability to travel
More and more citizens have internet access where tickets are usually sold
Liberalization and deregulation is increasing throughout the region, even China!
Foreigners have more availability to enterjoint ventures or buy stocks of domestic airlines The Significance that governments pose on expansion History has shown that Asian-Pacific governments have been opposed to expanding into the low-fair airline market
Currently, ASEAN countries are prepared to open the skies between their capital cities Combining the features present in other competitive markets and incorporating it in the Asia-Pacific Region Strength is in Customer Service Low fares generating increase passenger traffic
Maintaining costs Consistant and reliable offerings appealing to leisure and business markets What about Emerging Low Fair Airlines? Growth of a competing market can create many challenges Airasia must continue to maintain their current strategy
Improve business aspects when needed to maintain their competative advantage
Dependable and accessible service suited for all customers can be achieved with consistant and proper expansion Singapores Budget Airlines Austrialia's Quantas budget Airline Jetstar Tiger Incumbant Airlines They could possibly increase the competition, but history and costs says otherwise
Restructuring other planes to meet the needs of other markets tends not to be cost effective
They have established a successful company making large profits and expanding rapidly
Established features in order to continue to provide a low fair.
However, the majority of the market is UNTAPPED Gaining even more of the market will increase prices Why? Commodities cannot be catered for every customer available in the market
In order to meet this demand, they would have to find a cheaper distributor AirAsia's Success Future Marketplace for Asian Air Transport Growth & Expansion for LFA's will focus on three factors. Regulation Population Demographics Target Consumer:
500,000,000!!! Failure of Asia's regulatory environment creates uncertainty for liberalization Poor infrastructure and average disposable incomes will have an impact Thank You