Business Plan for a New Entrant Airline

Topics: British Airways, World's busiest airports by passenger traffic, London Heathrow Airport Pages: 12 (2534 words) Published: July 20, 2013
ATRN701
 Airline
 Economics
 
  Business
 Plan
 for
 a
 new-­‐entrant
 airline
 
  by
 
  Cem
 Ersöz
  w14191741
  March
 2013
 

Company
 Profile
 
FlyLikeUs is a new entrant airline financed by a team of businessmen from the UK and Finland. Its headquarters and main facilities are in Helsinki. London City Airport -where business travel is highly common but the demand for leisure travel continuously increases- is considered as our future hub as soon as required maintenance facilities are employed at the airport. FlyLikeUs wants to bring an innovative approach to regional market in Europe by operating a fleet of brand new high-tech Embraer E-Jets.

Mission
 
FlyLikeUs’s first priority is to assure ultimate safety by employing dedicated engineers and technicians who are highly focused on their jobs in their maintenance team. Our ground operations staff consists of passionate aviation enthusiasts with extreme handling care which will pave the way for on-time flights. Offering unique and high quality inflight services, flying with FlyLikeUs is to be a memory remembered by all our passengers.

Executive
 Summary
 
Our research team has concluded that London – Helsinki route has enough potential to make profit even in the first year of operations let alone trying to break even for a few years. The company’s financial status is in excellent condition and therefore we want an aggressive entry in the market with high quality services. Our projections suggest that after a smooth start in the route with one aircraft flying, another one with extended features could be employed as soon as the expected market share is gained. Research results of the past years regarding the route and the business plan for 2013 is as follows.

1
 Existing
 Services
 on
 the
 route
 
1.1
 Airlines
  The current market on the London – Helsinki route is dominated by the national flag carriers, which are British Airways (BA) and Finnair (AY). There is a codeshare agreement between the two airlines, which results in frequent flights between London Heathrow Airport (LHR) and Helsinki Vantaa Airport (HEL). Norwegian Air Shuttle (DY) also operates once daily between London Gatwick Airport (LGW) and Helsinki Vantaa Airport however their services are not suitable for same day return. 1.2  Schedules

  The current schedule is shown on table 1.1
Flight (*indicates codeshare) Org STD Des STA Served on A/C Type

BA794 (*AY5904) BA795 (*AY5905)

LHR HEL

12:10 07:50 07:40

HEL LHR

17:05 MTWTFSS 09:00 MTWTFS08:50 - - - - - - - S

A320 A320

BA798 (*AY5908) BA799 (*AY5909) AY3126 (*BA6036) AY3125 (*BA6035) AY832 (*BA6032) AY831 (*BA6031) AY838 (*BA6038) AY837 (*BA6037) AY840 (*BA6080) AY839 (*BA6079) AY834 (*BA6034) AY833 (*BA6033) DY5817 DY5816 DY5819 DY5818

LHR HEL LHR HEL LHR HEL LHR HEL LHR HEL LHR HEL LGW HEL

18:40 18:45 17:55

HEL LHR

23:35

07:30 19:30 10:20 08:00 13:35 11:25 16:10 14:05 18:05 16:00 09:10 07:35 18:40 LGW 18:45 HEL

18:55 19:00 HEL 12:20 LHR 20:40 HEL 15:15 LHR 09:10 HEL 18:25 LHR 12:35 HEL 21:05 LHR 15:10 HEL 23:00 LHR 17:10 HEL 14:10 LGW 08:35 HEL 23:40 18:05 18:10

17:05 LGW

MTWTF-S ------S-T-----M-WTFSS MTWTFSMTWTF-S MTWTFSS MTWTFSS ------S ------S MTWTFSS MTWTFSS MTWTFSS MTWTFSS -----S-----SMTWTF- ------S MTWTF- ------S

A320 A320 A320 A320 A321 A321 A320 A320 A320 A320 A321 A321 B737-800 B737-800 B737-800 B737-800

Table 1.1 taken rom OAG Schedule data of Sept 2012

1.3
 Fares
  British Airways and Finnair partnership offers two fares, which are classified as Economy (Euro Traveller Class) and Business (Club Europe Class). Economy class prices range from as low as £249.65 (arranged one month ahead of flight with a one week stay) to £782.65 (arranged two days prior to flight with a flexible return date). Business class prices range from £296.65 to £838.65, which are calculated in the...
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