Swot Analysis for Air China
SWOT analysis for Air China
The airline industry has undergone significant restructuring in recent years.Airlines, formerly rivals in a highly regulated industry, have become opportunisticseekers of co-operation. In today's world, mega-carriers and small airlines areworking together rather than competing with one another.
Forms of co-operation include sub-contracting, code sharing, franchising and theformation of global marketing networks. Such alliances allow firms to focus on their respective core competencies, while drawing the benefits of scale economies. In essence,co-operation among rivals has led to increased competitiveness. This has accelerated thetrend of joint marketing, and the airline industry has become characterized by the desireto belong to a global network. The tendency has been to strive for a global presence.
The case of Air China
Air China was founded on the 1st of July 1955. Its headquarters is based in Beijing. Itengages in international and domestic passenger and cargo flight services. To unify itsfacility image and simplify its repairs and maintenances, its fleet of 118 aircraftexclusively consists of Boeing models. It has established hub-spoke style passenger andcargo transport network. The hub of this network is Beijing International Airport.The company is operating 339 routes, which consists of 53 international and 286domestic, operating more than 1,000 scheduled flights on weekly basis, serving 29 citiesin 19 countries. About 66 per cent of its revenue was sourced from the domestic market.Since 2004, Air China has experienced dramatic changes in both the international anddomestic market.
Growing domestic market
Fierce competition and sluggish market demand has forced the company to turn its business focus on the fast growing domestic market, where it enjoys the protections fromthe Civil Aviation Administration of China (CAAC). Chinese Government adopted anaggressive fiscal policy by lowering the interest rate to 2 per cent, aiming to
The airline industry has undergone significant restructuring in recent years.Airlines, formerly rivals in a highly regulated industry, have become opportunisticseekers of co-operation. In today's world, mega-carriers and small airlines areworking together rather than competing with one another.
Forms of co-operation include sub-contracting, code sharing, franchising and theformation of global marketing networks. Such alliances allow firms to focus on their respective core competencies, while drawing the benefits of scale economies. In essence,co-operation among rivals has led to increased competitiveness. This has accelerated thetrend of joint marketing, and the airline industry has become characterized by the desireto belong to a global network. The tendency has been to strive for a global presence.
The case of Air China
Air China was founded on the 1st of July 1955. Its headquarters is based in Beijing. Itengages in international and domestic passenger and cargo flight services. To unify itsfacility image and simplify its repairs and maintenances, its fleet of 118 aircraftexclusively consists of Boeing models. It has established hub-spoke style passenger andcargo transport network. The hub of this network is Beijing International Airport.The company is operating 339 routes, which consists of 53 international and 286domestic, operating more than 1,000 scheduled flights on weekly basis, serving 29 citiesin 19 countries. About 66 per cent of its revenue was sourced from the domestic market.Since 2004, Air China has experienced dramatic changes in both the international anddomestic market.
Growing domestic market
Fierce competition and sluggish market demand has forced the company to turn its business focus on the fast growing domestic market, where it enjoys the protections fromthe Civil Aviation Administration of China (CAAC). Chinese Government adopted anaggressive fiscal policy by lowering the interest rate to 2 per cent, aiming to