Iberia Airlines Builds
Case study in the INTERNATIONAL
Presented by: Ashraf Hatem Hlouh
IBERIA AIRLINES BUILDS A BATNA
wanted to buy new jetliners
: chief financial officer and the man who led its
search for wide body jets, meant from the start to run a real horse race. Dupuy made it very competitive, His rule: “Whoever hits its target, wins the order”.
(Boeing) : who had been appointed Boeing 777 as a
"revenue machine" He insisted that his could earn Iberia about $8,000 more per flight than the A340-600 because it can hold more seats and is cheaper to operate.
(Airbus) : who is fumed at Iberia's pricing demands. A
New York City native and the company's highest-ranking
American, he pursues one goal: global domination over Boeing.
BATNA : Best Alternative To Negotiation Agreement.
Airbus and Boeing are competing
for market share through price cuts. In a volatile
industrial market this guarantees major advantages in
the bidding process. We, of course, cannot and
would not counsel collusion between the aircraft
makers. But, both firms would be better off with less
aggressive price discounting. One of Boeing's failings
is to not have a European working on business in
that part of the world. Notice how Airbus has hired
an American (Leahy) to sell planes in that market
whom does it serve?
In 1944, the civil Aviation Conference was held in
Chicago, where fifty two states sighed an International
Convention that established the basic principles for the
functioning of the air market: each country could negotiate
bilateral agreements with other countries in order to
regulate the market conditions that would govern air
traffic. Before the 1980’s, the planning system used was basically “ point to point”, that is to say, direct flights from one city of origin to another of destination. Instead
of planning simple routes, they planned
routes from and to the
hub airports that
came from or were going to other cities.
What value does Iberia Airlines deliver?
They used medium and low capacity aircraft
on low density routes. Generally they only
made domestic flights and rarely international
ones. They competed with flag carriers and
also with low cost carriers, which had caused
a decline in their per passenger income. For
that reason, some regional companies decided
to go into partnership with flag carriers which
results to also low cost carriers.
Why does Iberia Airlines matter?
It matters with the 1.9 billion passengers carried safely
by the airline, because of the low cost but efficient carrier. The strategic master plan II 2000-2013, established
customer service as one of its priority objectives which in
fact result with the passenger’s satisfaction that would be converted to profit.
What is Iberia Airlines ambition?
Its ambition is to suffice the need of its passengers while
giving low cost in a way that their service will be still in the international level and not only for domestic purposes
intention to give a
safe and worth it
What is its difference?
Its difference is that it gives low cost
flights which gives the customers the right
satisfaction. They managed flights “point-topoint”, both..Re: Sales Cycle Analysis. Iberia's Dupuy played the game to
perfection. His critical task was to strengthen
his BATNAs (best alternative to a negotiated
It had been a long time since Iberia had
bought Boeing. He went to great lengths to
bring the Boeing folks into the bidding
Another stroke of genius was to bring
the used Singapore Airlines 747s into
consideration. He also had done a good job
during the 1995 (another bad market year for
the aircraft makers) negotiations with airbus
by including the resale price...
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