International Element/ Global Condition
The main global competitors of AirAsia are Firefly, Tiger Airways and Jetstar Asia. All these international airlines have adapted the AirAsia’s low cost concept and can be a threat to AirAsia. “Knowing the increase of competition in the market, AirAsia applied the adaptation process (Hanan & Freeman, 1984) by expanding its operation to long haul services to various destinations. Moreover, AirAsia realised the price is destructive and try to avoid direct price competition and try to create a friendly competition environment.” (UK Essays, 2009) By doing this, AirAsia has gained competitive advantage that contributes success to its organization, being the market leader for LCC in South East Asia. The development of countries outside the home country(Malaysia), also plays a part in contributing success for AirAsia. For example, promotion of tourism in the neighboring countries gives another reason for Malaysian to take a ride of the AirAsia. Since Malaysia is well known of having more holidays than other countries, going on a trip is just a common thing what Malaysian will do, with AirAsia that is famous for low-cost airfares, travelling became even easier. Business development wise, “within the South-East region, AirAsia can tap on a lot of opportunities since there is huge potential for customers that consist of foreign workers from neighboring country such as Indonesia, Myanmar and Vietnam.”(AirAsia Strategic Management, 2011) Hence, the opening of new airport in South East Asia region is one of the best opportunities. AirAsia can take this chance to set up new branches to boost profitability.
One of the strategy, Air Asia applied its competitive advantage is in giving out air flight ticket which are lower than competitors, thus Air Asia also known as the low cost carrier industry where cost is the competitive objective by providing the lowest...