As could be expected, the media are moving in for an imminent collapse. Have you flown with Tiger?
Customer has little brand loyalty. If consumers of Air Asia do not have brand loyalty, then the strength of the threat of new entrants is very high.
The high numbers of competitors in the industry also decrease Air Asia customer loyalty. Most of the travelers prefer low cost. New competitors which want to come in the industry have to spend little to compete with Air Asia. The industry of airline needs large volume of start-up capital.
The cost of setting up of offices, buying or leasing aircraft, hiring pilots and other staffs like air stewardess and etc incur a high start-up cost.
Thus, the threat is low for Air Asia. Other than the passenger sales ticket, Air Asia also include holiday packages which is affordable around Asia. Air Asia has good connection with hotels and tourism companies around Asia, which it is hard for new competitors to compete.
Customers do not need to spend more on switching to another airline. Moderate access to distribution channel. Air Asia is the first airline company to enable customer book and purchase air tickets online in Malaysia.
This makes its website www. Although new competitors can create a website for their company, it is quite difficult to compete with Air Asia website. The website is known of its simplicity and user friendly. Thus, new competitors are difficult to make known their websites to travelers.
In obtaining license and permit to operate an airline company is quite restricted. This is because in Malaysia, the airline industry is very competitive already and that the government also wants to protect the interest of its national airline, MAS which is operating on loses a few years back.
Rivalry among existing firms The strength of this factor depends on: High numbers of rivals. Some of the airline does not compete directly with Air Asia, but it competes indirectly in routes that Air Asia does not fly.
Thus, the higher the number of competitors, the more fierce the competition. The airline industry incurs high fixed cost which consists of finance cost, hire purchase, and staff costs. The airline companies have to gain more market share to cover the fixed costs.
In doing that, constant price reduction is done by them to compete with others. Thus, the rivalry is strong. The main purpose of using the airline services is to get to the destination intended.
Customers can switch to other airline easily which makes the industry so competitive.Nov 14, · Firearm Discussion and Resources from AR, AK, Handguns and more! Buy, Sell, and Trade your Firearms and Gear. Porters 5 Forces Analysis On Air Asia Management Essay 5 Dec Porters Five-Forces Model of competitive analysis is widely implemented by most of the company to progress their strategies in many industries.
As increasing in the number of airline competitor such as Jet Star and Tiger Airways which are also promote low cost fare may. Fan us on Facebook! We will be posting special offers and important news on our Facebook page. Porter created the th Fighter Squadron, Army Air Forces, eagle with boxing gloves which came from the American Eagle Squadron in the Royal Air Force.
Williams created the Flying Tiger. Porter’s 5 Forces Before the idea of Ryanair or indeed any low cost carrier was even devised the European airways industry was, as already illustrated, highly regulated.
Therefore post and deregulation, great changes came about.
Porter’s Five Forces Analysis Michael Porter identified five forces that influence an industry. These forces are: (1) degree of rivalry; (2) threat of substitutes; (3) barriers to .