Air Astana

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|Group Progect | |Strategic Management Course | |Strategic analysis of Air Astana Company | | | | | |25.02.2010 |

|Dr. Bulent Dumlupinar, PhD |

OUTLINE

1. Company profile………………………………………………………………………..3p. 2. Industry analysis………………………………………………………………………..5p. 1. Structure of the airlines industry………………………………………….……..5p. 2. Air industry financials……………..…………………………………………….7p. 3. Competitors Analysis………………………………………………………….8p. 4. Key success factors…………………………………………………………...11p. 3. Strategic evaluation (SWOT)…………………………………………………………14p. 4. Critical issues & recommendations………………………………………………….17p. 5. References......................................................................................................................19.p. 6. List of Appendix.............................................................................................................20p.

1. COMPANY PROFILE
JSC Air Astana (the “Company”) is a joint stock company as defined in the Civil Code of the Republic of Kazakhstan. The Company was established as a closed joint stock company on 14 September 2001 to Resolution of the Government of the Republic of Kazakhstan # 1118 dated 29 August 2001. Due to a change in legislation introduced in 2003, the Company was re-registered as a joint stock company on 27 May 2005. The Company’s principal activity is the provision of scheduled domestic and international air services for passengers. Other business activities include freight and mail transportation. The shareholders of the Company are JSC “Samruk - Kazyna”, which holds the investment on the behalf of the Government of the Republic of Kazakhstan and BAE Systems Kazakhstan Limited. JSC “Samruk-Kazyna” and BAE Systems Kazakhstan Limited own 51% and 49% of the Company, respectively. The Ministry of Transport and Communications of the Republic of Kazakhstan transferred its 51% ownership interest in the Company to JSC “Samruk” on 24 October 2006. Currently, according to the Decree by the President of Kazakhstan, this 51% interest owned by Kazakhstan Government is under the management of Samruk-Kazyna National Welfare Fund, following JSC “Samruk” joining with other JSC “Kazyna” to form the “Samruk-Kazyna” National Welfare Fund. At present, Air Astana flies to 15 destinations on 22 domestic routes, which account for 76% of the market (see Appendix 1). It also offers a similar number of international routes, serving 17 cities, supporting a combined 2.1 million passengers in 2009, down 6% year-on-year. Air Astana operates virtually all international routes, with rival Scat Air flying the only other scheduled cross-border services. Strategy of the Company.

Air Astana's strategy is currently focused on its "surrogate home market", which includes Kazakhstan, its central Asian neighbors, south-eastern Russia and South-East Asia. "All of this we regard as fair game," says Foster. The airline has recently opened services to Baku in Azerbaijan, Bishkek in Kyrgyzstan, Novosibirsk and Kuala Lumpur. It is also eyeing Dushanbe in Tajikistan and Tashkent in Uzbekistan, as well as...
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