Because of its efficient cost-saving strategies, Southwest's 37-year streak of profitability is unmatched in the airline industry. Here is a little information about its major competitors: • AirTran Holdings - is one of America’s largest low-fare passenger airlines. The airline has managed to achieve low operating costs despite relying on a hub-and-spoke system, in which most of its flights originate and terminate at its hub in Atlanta, Georgia. • American Airlines - the second largest airline in the world based on available seat miles and revenue passenger miles. On an
Case Summary and Important facts Despite the fact the airline industry had 87 new-airline failures in the US over the past 20 years. David Neeleman convinced a group of investors and quickly raised $130 million from venture-capital community. With its strong capital base, JetBlue acquired a fleet of new Airbus A320 aircraft and focused on innovation, providing the most valuable and the most excellent travel experience, low-cost, point-to-point service to large metropolitan areas with high average fares or highly traveled markets that were underserved, mainly on central and Western routes in the US. During 2001 and 2006, the airline industry was facing a number of external stress, such as the 911 terrorist attacks, Iraq War, SARS, high price of petroleum, ect. The airline industry in US has been challenged and many of firms were bankrupt.
• How would the Advertising for a price cut or other alternative fit in with current promotions, advertising and year advertising budget? Industry/Market Analysis • Position Analysis: o Southwest is one of three major competitors in a Texas intrastate air service between Dallas-Fort Worth, Houston and San Antonio. Southwest currently (Feb 1st, 1973) is second in market share holding approximately 41.2% of the total Market. (See Exhibit 1). o Southwest is considerably smaller than both of the other competing airlines as far as planes (3 total compared to Braniff’s 69 and TI’s 45 total aircraft) which limited the amount of flights that could be increased in any one route.
Airbus A3XX: Developing the World’s Largest Commercial Jet 1. What are the main factors determining the profitability of the A3XX project? Number of planes sold per year – The first and most important factor determining the profitability of the A3XX project is long term demand. This is measured by the number of planes sold/year. In 2000, both manufacturers believed that Asia would register the world’s highest growth rate over the next 20 years.
Case Recap South West Airlines, in existence since 1971, has slowly grown its business by focusing on cheaper fares, excellent customer service and employee engagement. In 1994 it was declared eighth largest airline based on Revenue Passenger Miles (RPM) flown. In same year it recorded net income of $179.3 million with total operating revenue of $2.6 billion. It’s excellent low cost operations became model for Airline Industry. Other Airlines, such as United and Continental started copying Southwest’s operations model and competing directly with Southwest by introducing a concept called Airline-Within-an-Airline.
They were right (southwest.com). On June 18, 1971, Southwest Airlines started its first customer service flights with three Boeing 737 aircrafts which serviced the golden triangle, Dallas, Houston, and San Antonio Texas. When Southwest Airlines exceeded the billion-dollar revenue mark, they officially became a major airline in 1989. Herb Kelleher, CEO, did not believe in hierarchies. SWA did not have an HR department, it had a People Department.
Historical The company was launched in 1971. It began with four planes and never left the state of Texas (cbsnews.com). Of the original employees, there are 12 remaining in the employ of Southwest at this time (Organizational Culture…). The company struggled to survive until 1978 when the Airline Deregulation Act allowed Southwest to lower its airfares and expand service beyond the Texas borders to which it had been held. Herb Kelleher, former Chairman of the Board as well as one of the original founders (Knol, Jurjan), established the culture and philosophy.
Southwest Airlines – 2008 Case Study Executive Summary Millions of people fly everyday. Southwest airlines provide low-fare travel among 58 cities in the United States. Although the airline industry suffered greatly in the aftermath of September 11, Southwest was able to continue to hold strong. Southwest airline continues to maintain steady sales as much of the industry was affected by changes in laws/regulations and competition entering the market. In the following report there is a brief introduction to Southwest Airlines and their strategy and then what, if anything, they need to do or not do to remain at the top and competitive in the airline industry.
After seeing its profits fall 36% last year, Embraer was forced to lay off 20% of its workforce. Embraer’s chief executive has expressed his belief that Executive Jets along with defense contracts are the key to making it through the tough economic times. He projects these two aspects will account for half of the companies revenue. It is clear then that Executive Jets are a good barometer for the overall success of the company. The smaller, more efficient aircraft is the trademark of Embraer’s success.
United Airlines first placed the 777 into commercial airline service in 1995. As of April 2012, 60 customers had placed orders for 1,367 aircraft of all variants, with 1,009 delivered. [1] The most common