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The airline industry is struggling

Source: www.aea.be
Topic: Airline Industry

Sort Desciption: outside the airline industry for inspiration they. commonly look at the hospitality and retail. industries. Impurity, imitation, and innovation ...

Content Inside: Kristian Hvass (45) 38153454 Solbjerg Plads 3, C5 kah.tcm@cbs.dk 2000 Frederiksberg Denmark www.airlinebusinessmodels.blogspot.com SURVEY RESULTS A QUESTION OF CHANGE The current airline industry has been plagued with adverse market conditions, increasing competition, depressed economies, and ever- increasing fuel prices. Such an unfavorable environment has created a situation that is ripe for airlines to implement strategic changes, which this brochure categorizes and explains. Results show that competition is fierce, not only among similar types of airlines but also among the other strategic groups found in the industry, and that all airlines continue to struggle to clearly define and differentiate themselves. Fare structures and network integration are the greatest changes taking place in the industry today, while service improvements are largely ignored, even though a majority of airlines stress its importance in differentiation attempts. In 2005 Copenhagen Business School initiated a PhD study of airline business models with the intention of proposing future models that may appear in the industry. A survey was distributed in early 2007, in collaboration with the Association of European Airlines, to scheduled passenger airlines worldwide. The intent of the survey was to determine the level of competition that airlines experience and how the business model has been adapted to meet the challenging market conditions. This document is a summarized, anonymous analysis of the survey responses. The author wishes to express his gratitude to those airlines that took the time to complete the survey, and hopes that this summary may help to better understand this dynamic industry and hopefully lead to improved performance. Who responded In early 2007 197 surveys were distributed globally to CEOs at airlines earning more than US$ 5 million in revenue. After sorting the responses, 42 completed surveys were useable, an acceptable response rate of 21%. Classif ...

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