Strategic Management

Topics: AirAsia, Low-cost carrier, Airline Pages: 50 (12900 words) Published: March 20, 2012


Company Background

. AirAsia Berhad was established in 1993 and started operations on 18 November 1996. On December 2, 2001, the heavily-indebted airline was purchased by former Time Warner executive Tony Fernandes's company Tune Air Sdn Bhd for the token sum of one ringgit. Fernandes proceeded to engineer a remarkable turnaround, turning a profit in 2002 and launching new routes from its hub in Kuala Lumpur International Airport at breakneck speed, undercutting former monopoly operator Malaysia Airlines with promotional fares as low as RM1. In 2003, AirAsia opened a second hub at Senai Airport in Johor Bahru near Singapore and launched its first international flight to Bangkok. AirAsia has since started a Thai subsidiary, added Singapore itself to the destination list, and commenced flights to Indonesia. Flights to Macau started in June 2004, while flights to Mainland China (Xiamen) and the Philippines (Manila) started in April 2005. Flights to Vietnam and Cambodia followed later in 2005 and to Brunei and Myanmar in 2006, the latter by Thai AirAsia.

A new budget terminal, the first of its kind in Asia was opened in Kuala Lumpur International Airport on 23 March 2006 and the Low Cost Carrier Terminal (LCCT) is the new home for AirAsia Bhd. LCCT will initially handle 10 million passengers a year.

Core Product

AirAsia Berhad is a low-cost airline based in Kuala Lumpur, Malaysia. It operates scheduled domestic and international flights and is Asia's largest low fare, no frills airline AirAsia currently boasts a fleet of 78 aircraft that flies to over 60 domestic and international destinations and operates over 500 domestic and international flights daily from six hubs located at Low Cost Carrier Terminal (LCCT, KLIA), Johor Bahru, Kota Kinabalu, Bangkok (Thailand), Jakarta (Indonesia) and Bali (Indonesia). With over 110 routes across 13 countries, AirAsia is truly Asia leading airline with the widest route connectivity and largest customer base.

AirAsia began a gradual conversion of its fleet from the Boeing 737-300 to the Airbus A320-200, with the first order made for 40 Airbus A320 aircraft and 40 more on option in a Memorandum of Understanding made in 17 December 2004

Board of Directors




To be the largest low cost airline in Asia and serving the 3 billion people who are currently underserved with poor connectivity and high fares.

AirAsia has a clear vision statement. Based on their vision, we can know what they want to become. The main reason why company develops a business is to be the largest low cost airline in Asia and serving 3 billion underserved people with poor connectivity and high fares. A clear vision statement is very important to make sure all department and workers has a clear view of what company want to be in the future. This vision supported by a comprehensive mission statement.


• To be the best company to work for whereby employees are treated as part of a big family.

• Create a globally recognized ASEAN brand.

• To attain the lowest cost so that everyone can fly with AirAsia.

• Maintain the highest the quality product, embracing technology to reduce cost and enhance service level.

A good mission statement must have nine component of mission statement:

1. Customer

2. Product or service

3. Markets

4. Technology

5. Concern for survival, growth, and profitability

6. Philosophy

7. Self-concept

8. Concern for public image

9. Concern for employees


1. Customer

- Customer means who are the firm’s customer. Whose company targeted people to consume their product or service.

- Based on AirAsia mission statement, we found that there have stated company’s customers. Company target everyone will be their customer based on;

“ that...
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