Airasia Company Analysis

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AirAsia company analysis
AirAsia is the leading low-cost airline company in Asia. The company provides transportation for passengers and cargo services across domestic and international markets from 97 destinations in 21 countries. It consists of over 8,000 staff and makes up a market capital approximately RM7.06 billion (AirAsia, 2012). AirAsia’s competitors are Malaysia Airlines and other national airlines. AirAsia has five Air operation’s certificates (AOCs) – Malaysia, Thailand, Indonesia Philippines and Japan (AirAsia, 2012). The company has market share for domestic and international, 60 per cent 40 per cent respectively (the star online, 2012). AirAsia has the highest profit margins in the global industry 20 % EBIT (Earnings before interest and tax) margins in 3Q 2012 (Centre for aviation, 2012). According to AirAsia‘s company annual report 2012, Company Net profit and company sale revenues ended 31 December 2011 were RM 553 million and RM 4.5 billion respectively. Thus AirAsia is the leader of low cost airlines in Asia. This essay will focus on Air Asia’s overview business from the past to the current period including origins and key developments. In addition, it will discuss strength, weakness, opportunities and threats analysis of AirAsia. In addition, it will discuss AirAsia’s likely future performance and give recommendations to its future business.

AirAsia was established in 2001 by Dato' Sri Dr. Tony Fernandes and his partners. The company implemented the successful low-cost carrier (LCC) business model which is a basic airline; this business model origins from the successful airlines of Southwest Airlines in Europe and Ryanair in the UK (Poon and Waring, 2010). AirAsia started its first service within Malaysia with two Boeing 737s (Kotler and Armstrong, 2012). In 2002, in order to obtain higher capacity on planes and improved fuel-cost efficiency, AirAsia replaced the existing Boeing B737s with the new Airbus A320s (AirAsia, 2012). Recently,...
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