Emirates Airlines was established in 25th October, 1985. Presently Emirates Airlines has 142 fleets aircrafts and destinations over more than 102 countries worldwide. Recently it made an order for aircrafts worth $ 27 Billion for 45 Airbuses A380, in this way cit become the world’s largest purchaser of Airbus’s super-jumbo. (Regarding Emirates) Emirates Airlines is very fast growing airlines. Emirates have 5th number over the world in profitability. Emirates earned profit on March 31,2010 is more than $3,538 since last 17 years and it’s growth ration more than 20% a year. (BBC News) External Environment
Airline Industry Analysis
Airline industry Profile
Presently airline industry growing very well and world top level profitability industry where from we can earn profit .On the other hand political and some other economic factors are affected on this industry, after 11th September there was a great change in the trend of abroad journey for visit, studying and business purposes etc. Another big factor is rapidly rising in oil prices over the world specially in middle east as well, due to this cost increased of airline industry and in this way profit has been decreased and these losses has been reached round $ 6 billion in 2009 (IATA) 6 billion in 2009 (IATA) Eventually, the airline industry has been restored number of passengers. We are watching again the trend of tourism, international trade and development of globalization and in this way numbers of passengers has been increased and exceed 2.3 billion by the end of 2009.(IATA).Thus, for winning and strong image in aviation market its compulsory for airlines that cut of their prices and improve their services. Life Cycle of Airline Industry.
The Product Life Cycle refers to the sequence of stages a product goes through. Any new product in market go through a sequences of stages from introduction to maturity ,growth to decline and this sequence of all stages is called product life cycle. We can also say the stages through which individual products build up over time is called" The Product Life Cycle". (Saaksvuore. A and Immune. A, 2008) The classic product life cycle has four stages are:
Introduction Stage or Development stage
Airline Industry Life cycle:
According to product life cycle at the movement airline industry on its maturity stage due to big and perfect competition in the market. In this Maturity stage competition is more hostile in order to increasing advertisement and promotion activities. Further more many competitors increased their budgets on Research and development (R&D) Through increasing customers’ brand loyalty many companies want to differentiate them from their competitors in their services and products. In this stage companies starts cutting their operating cost mean profit margin decreases result least efficient companies are not more in market. Accordingly, many companies’ use offensive strategies instead of defensive strategies by using methods of changing their market strategy ,product development and marketing mix for stay alive and compete during this aggressive stage. “(Development of new product)” Porter’s 5 Forces
Threats of New Entrants
The new entrants in any industry face some threats from existing companies because new company offer more attractive product with low cost etc. In airline industry threats are low as comparatively barriers are high. Some challenges under below due to new entrants.. Capital Requirements. We need huge capital for this industry for purchasing new crafts and also for starting new projects and also need for attractive to customers. Brand name & Customer loyalty: Airlines companies with excellent goodwill and strong image in market will easily compete with new threats at the time of entry. # Bargaining Power of Supplier’s
Suppliers can easily change market trend through their high demand and control on prices and quality of their products &...