Air Asia Introduction

Topics: Airline, Low-cost carrier, AirAsia Pages: 10 (3315 words) Published: December 5, 2013
I. IICOMPANY BACKGROUND
AirAsia was established in 1993 which founded by government. In 2001 it was bought by Tony Fernandes. AirAsia aims 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. With a fleet of 72 aircrafts, AirAsian flies to over 61 domestic and international destination with 108 routes, and operate over 400 flights daily from hubs located in Malaysia, Thailand, and Indonesia. Today, AirAsia has flown over 55 million guests across the region and continues to create more extensive route network through its associate companies. While for the mission of AirAsia, AirAsia wants to be the best airline company to work whereby employees are treated as part of the big family. Besides, AirAsia try to maintain the lowest cost hence everyone can fly with AirAsia. Highest quality product, embracing technology to lower the cost and improvement in service levels will be maintained by the AirAsia airline also. Lastly, create a globally recognized ASEAN brand will be the mission part of AirAsia. AirAsia makes the low fare model possible and create values through their key strategies such as: Safety first, high aircraft utilization, low fare- no frills, streamline operations, lean distribution system, and point to point network. II. Threshold

AirAsia needs to come out with the greatest strategic to compete with their rival in the same industry. AirAsia might not be able to compete with the complex business environment without the right strategic management. Organizations or companies do not exist simply to survive in the market place but want to grow and prosper in a competitive environment. Because of this reason, AirAsia need to consider a strategic management as the important things in their company. The strategy that AirAsia need is not just how to reduce cost and make the operational activities running effectively. But, AirAsia needs to come out with the strategy that can make competitive position that the company performs different activities from rivals or performing similar activities in different ways to achieve their business successfully. The globalization also forced AirAsia Company to survival for business. To see and appreciate the world from the perspective of others has become a matter of survival business. The price and quality of firm’s products and services must be competitive on a worldwide basis, not just a local basis. The globalization makes a rapid change in the business environment. Every company has a same chance and opportunity for doing their business. For those company doesn’t aware and take this as important consideration, they will failed to compete with their rival or competitors in their business. E-commerce is becoming a business tool. E-commerce also has become a vital strategic management and allows a company to sell products, advertise, purchase supplies, bypass intermediaries, track inventory, eliminate paperwork, and share information. In total, electronic commerce is minimizing the expense and cumbersomeness, improved products, and higher profitability. The very small price is offered to the customer also can give biggest affect in this business. As all airlines in low cost carrier (LCC) industry compete on costs, AirAsia needs to offer the lowest possible fare in order to win the competition in the current markets served as well as new markets. AirAsia move from the traditional business into modern business by implementing E-commerce and maximize the information technology (IT) in their business. The implementation of E-commerce can reduce the cost of travel agents, and less of ticketing paper cost. AirAsia also choose the route by adjusting prices for routes/destinations that have a higher demand when compared to others. AirAsia also trying to reduce by using better maintenance management. According to Gloker (2002), by using the better maintenance management, AirAsia can save large...
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