Airborne Express in 2002
Statement of Purpose
The group aims to identify the generic strategy Airborne Express is pursuing, whether such strategy is sound in the context of air express industry. The company’s strengths and weaknesses are evaluated with the opportunities and threats to identify the distinctive competency that it can adapt.
Statement of the Problem
The group endeavors to identify the strategy that Airborne Express can implement to its domestic and international operations. Assessing the strategic alliances the company made and the diversification of its services including logistic services is also part of the group’s objective.
Alternative Courses of Action
Lease Out Airport
One solution that is viable to some of Airborne’s dilemmas is leasing out a portion of their airport to private aircrafts or to its competitors. As mentioned in the case, Airborne has seen a decrease in price of its package per customer area. Competition and the new methods of sending packages cause its profits to drop. Such lease can subsidize these falling rates. With the cost of building an airport well above $120 million, this would be an option for other air carriers to consider. Further, with the revenue brought by the leases, Airborne could build another runway so the leased part of the airport would not affect Airborne’s business.
However, competitors might be hesitant in giving Airborne additional revenues.
Accept DHL company acquisition
Since Airborne lacks capital for its expansion in the international scene, the takeover of DHL can be a good approach to achieve global scope. Additional facilities abroad can be accessed as well in such merger. This will provide an opportunity for the merged company to compete with UPS and FedEx and can possibly obtain increased market share especially in the international scene.
This might not be good for the ego of the new administration but, as recalled in their history, Airborne has previously experienced
The group aims to identify the generic strategy Airborne Express is pursuing, whether such strategy is sound in the context of air express industry. The company’s strengths and weaknesses are evaluated with the opportunities and threats to identify the distinctive competency that it can adapt.
Statement of the Problem
The group endeavors to identify the strategy that Airborne Express can implement to its domestic and international operations. Assessing the strategic alliances the company made and the diversification of its services including logistic services is also part of the group’s objective.
Alternative Courses of Action
Lease Out Airport
One solution that is viable to some of Airborne’s dilemmas is leasing out a portion of their airport to private aircrafts or to its competitors. As mentioned in the case, Airborne has seen a decrease in price of its package per customer area. Competition and the new methods of sending packages cause its profits to drop. Such lease can subsidize these falling rates. With the cost of building an airport well above $120 million, this would be an option for other air carriers to consider. Further, with the revenue brought by the leases, Airborne could build another runway so the leased part of the airport would not affect Airborne’s business.
However, competitors might be hesitant in giving Airborne additional revenues.
Accept DHL company acquisition
Since Airborne lacks capital for its expansion in the international scene, the takeover of DHL can be a good approach to achieve global scope. Additional facilities abroad can be accessed as well in such merger. This will provide an opportunity for the merged company to compete with UPS and FedEx and can possibly obtain increased market share especially in the international scene.
This might not be good for the ego of the new administration but, as recalled in their history, Airborne has previously experienced