Tony Fernandes hires people with passion. The SWOT process will start by examining the strengths of the Air Asia of today. To implement this strategy, the airline would have to expand the size of its fleet, with the possibility of adding some wide body aircraft designed for long haul flights in addition to A320s. He owns a football team in England, an F1 car racing team and is a major supporter of Asia’s biggest mixed martial arts sport, the OneFC. These systems are also used to maximise load capacity by controlling scheduling and use of aircraft. After he turned around AirAsia, in 2003 Fernandes lobbied Dr. Mahathir to raise the “Open Skies” idea with leaders of Thailand, Indonesia, and Singapore, leading to these nations giving AirAsia and other budget airlines landing rights. AirAsia’s mission: • A low cost airline carrier that offers five-star service with 95% of on-time performance. From simple essay plans, through to full dissertations, you can guarantee we have a service perfectly matched to your needs. *You can also browse our support articles here >. In contrast, the major air carrier segment of the industry can be considered mature, but undergoing a period of transformation because of the elimination to governmental regulations that had given many of these airlines a competitive advantage in routes and airport access. Chopard is a 153-year-old Swiss luxury watch brand. These major airlines often use a hub-and-spoke routing system in which short-haul feeder flights bring passengers to a hub airport for transfer to other aircraft for long-haul flights or for other short-haul flights to reach their final destination (Burghouwt and Veldhuis, 2006, p. 107). The producers of fuel have relatively strong bargaining power because oil prices are established by global markets with airline consumption representing only a small portion of oil industry sales. Fernandes was formerly Southeast Asian regional vice president for Warner Music Group from 1992-2001. His business offices have no walls and he seeks ideas from his staff. Air Asia entered the low-cost international market in 2003. Economic: The rate of economic growth in the ASEAN nations is variable, with the ASEAN member nations experiencing a growth rate of only 1.5% in 2009 because of the global economic crisis. Air Asia has implemented the strategy of joint ventures to create market share in the Asia markets and launched several joint ventures in different countries, like, India, Japan and China. Management. The firm was a pioneer in the use of internet reservation and paperless tickets in the market, with its marketing overcoming any passenger reluctance to use the electronic systems. Save your Email with Mailbird 2.0: The anti-depressant for your Inbox. Full service airlines are large firms that have been in the industry for an extended period of time, with many of these airlines enjoying a monopoly or quasi monopoly on certain national routes prior to the gradual liberalisation of the airline industry in the ASEAN market, with full liberalisation taking place by 2015. Resilient profit growth through our lower cost base. The Crowd-Funding Campaign will be in cooperation with Channel News Asia, one of Asia’s biggest TV Channels! Competitors in this group include Singapore Airlines, Air China, Malaysian Air, and Thai Airways International. The propensity of air travel in East Asia is relatively low compared to the global average of 2.0 trips per year, with India at .1 and China at .3 (O’Connell & Williams, 2006, p. 362). Published: 1st Jan 2015 in Another strength of the firm is its marketing competency, which has effectively designed and promoted a service targeted to the underserved low-cost no frills segment of the market. The lower staffing creates issues such as delays in turnaround time that result in delays in departures, with inadequate communications and support for delayed passengers. Like Trump, Fernandes this year hosted the Asian version of the TV series The Apprentice Asia, with the winner being Filipino UP Diliman economics graduate Jonathan Allen S. Yabut, who is now also chief marketing officer of AirAsia Zest. Fernandes mortgaged his house and got personal savings to buy this firm with two old jets and US$11 million worth of debt. Economic growth in 2010 and beyond in the region is likely to be strong because East Asia has largely recovered from the global recession. To export a reference to this article please select a referencing stye below: If you are the original writer of this essay and no longer wish to have your work published on UKEssays.com then please: Our academic writing and marking services can help you! You don’t need to read any more lists and posts about how you’re not doing enough. Air Asia does not have its own maintenance, repair and overhaul (MRO) facility. At the same time, the firm’s strengths can help overcome the threats posed by increased competition. Business travellers value flight schedule and convenience in an airline with price often a secondary consideration. Page 1 Microeconomics & Strategy Case study: AirAsia 2. Marketing — Tony Fernandes invests in and excels in marketing. 12 Strategies of Success from AirAsia’s Founder Tony Fernandes. Who is 49-year-old Tan Sri Anthony Francis “Tony” Fernandes, who has built the publicly listed AirAsia Group into Asia’s largest low-cost airline, with over 120 destinations servicing over 220 million passengers? Invest and enhance the AirAsia brand to increase investors' returns. The inbound logistics segment of the chain involves purchase or leasing of aircraft, fuel, and gate space at airports, which add some value through reducing overhead and by providing convenient or desirable routes. Threat of Entry: The threat of entry is high in the industry. Air Asia should expand into the intercontinental market by using Abu Dhabi as a hub for routes in western Asia, North Africa, and Europe. Besides that, this will also determine if Air Asia has a chance and market opportunity to expand their business in European market, specifically the UK market. Air Asia has been successful in attracting the low-cost segment of the market, but may not have sufficient flexibility to respond to a change in the environment such as a surge in business demand or a dramatic decrease in demand because of terrorist attack or high fuel prices. Pick all the topics you are interested in to fill your Empirics Profile with stories you'll love from other authors. It has hedged 100% of its fuel requirements for the next three years, achieves an aircraft turnaround time of 25 minutes, has a crew productivity level that is triple that of Malaysia Airlines and achieves an average aircraft utilization rate of 13 hours a day. Nations in the region such as India and China that are not members of ASEAN are also liberalising air transportation regulations (O’Connell & Williams, 2006, p. 362). The Asean super app for booking flights, hotels, activities, food, unlimited deals and so much more! In addition, the increased commerce with the ASEAN region and with China as a result of the ASEAN Free Trade Agreement that was gradually implemented between 2004 and 2010 is producing higher commercial and business demand for air transportation between Southeast Asia and China (Wong & Chan, 2004, p. 509). Bold vision — Tony Fernandes has a bold, global and long-range vision for his various companies. 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