AirAsia Low Fare
A Written Analysis of the Case
Holy Cross College of Sasa, Inc
KM. 9 Sasa, 8000 Davao City
In Partial Fulfillment of the Requirements for the Subject
Mktg 1: Principles of Marketing
Mark Angelo B. Bugtac
I – Executive Summary
December 2000, AirAsia was an insolent subsidiary of deeply indebted Malaysian Conglomerate. Airline had only two planes. Tony Fernandes was a former managing director of Warner Musics Malaysian Operator. He assembled a group of small investors to buy AirAsia for 26 cents. AirAsia was known to have a first low fare in Asia. With in seven months of operation they all repaid all its debts. AirAsia earn $8 million of profits on sales of $66 million. AirAsia now can accommodate 20 cities with as low as $16 from kuala lumpur to senang. They are keeping prices low of maintain. Their regular fee from different cities. One of the competitor is valuair stated by a former SIA pioneer, 71 year old chin beng lim.
II – Statement of the Problem
Finding a way to develop and to improve the capacity of the air Asia, and developing a price for a affordable fare because not all people can avail the fare of airlines. For only seven months the airlines earn profit of $8 million on sales of $66 million. That’s why AirAsia was launched as asia first low fare. They are now expanding to Singapore and Bangkok in Thailand to accommodate more people and ofcourse to develop the AirAsia and give chance to other to ride an airlines. AirAsia one way fare as low as $16 kula lumpur to penang. Singapore bali round trip ticket on AirAsia is $123 while Garuda charges $305 Singapore airline $406 and Malaysian Airline system is $654. There is still a big defference of price between the AirAsia and other airline competitor.
III – Objectives of the study
Their objectives is to accommodate more people and let people experice fly above for an affordable price and AirAsia hope for stay growing competition and expand its market all over the...
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