All this boiled down to a low cost air travel that was able to compete with ground transportation services. During May of 2011 Southwest Airlines purchased all of AirTrans outstanding common stock increasing Southwest’s fleet by 140 aircraft and the ability to spread
Boeing VS Airbus A380 Business Interior Both Boeing and Airbus share some similar business practices and marketing techniques, but that’s where it stops, the rivalry and competition between the two companies has always proved to be beneficial to clients. Between the two companies, you are able to find the perfect aircraft for your needs. But between Boeing and Airbus, who provides the best marketing to clients, and most important, who has the better product. Boeing 787 Mockup Interior Boeing is staying away from the large capacity aircraft designs and is looking to producing the B787 Dreamliner which will be a quick and fuel efficient. Having already filled the market with 747s, Boeing is looking to capitalize on the demand for direct flights and medium capacity requirements.
Who are some of the major competitors? Southwest competes against many low-cost carriers or low-cost subsidiaries of larger carriers. Southwest's main low-cost carrier competitors are AirTran and JetBlue Airways. Its other competitors include American Airline, United and Delta. Because of its efficient cost-saving strategies, Southwest's 37-year streak of profitability is unmatched in the airline industry.
Internal capabilities/strength and weakness of JetBlue JetBlue is the largest Airline at JFK airport in New York City. The strengths of JetBlue are low operating cost. JetBlue has been efficiently utilization the resources which results in low cost operating cost. For instance, there is 6.03 cents mile vs. 10.91 industry average and also direct booking. Moreover, JetBlue has efficient employee.
Their service strategy is based on short-haul, point-to-point direct flights that are accomplished with amazingly short turnaround times. With their strategy, Southwest has a strong majority of the market share in the point-to-point market. Southwest’s goal is to make air travel affordable to all, both the time-sensitive business traveler and the price-sensitive leisure traveler. They are able to offer their low ticket fare because of good management-labor relations, fast turnaround time at the gate, faster speed of operations offered with smaller airports, and lower maintenance costs due to flying only one model of airplane. The strong leadership, strategy and culture that were built and are supported by Herb Kelleher, the former CEO of Southwest, support all these items that keep ticket fares low.
They also offer profit sharing which encourages the employees to help make SWA successful. Outside of their employees, SWA operates only one type of aircraft. This reduces the need to store additional parts and eliminates the need to train pilots and technicians. Lastly, they fly point to point, rather than from hubs, which reduces delays and captures demand as larger airlines might not fly from smaller airports. File 3. pg.
3. The low-fare airlines strategy contributes a lot to the success of JetBlue. * JetBlue imitates Southwest Airlines to operate low-fare model that includes high-frequency, short-haul, point-to-point, low-cost service strategies. 4. JetBlue provides advanced and technological services to the customers, aiming to establish a professional brand in airlines industry.
I would say that JetBlue would fall under both customer intimacy and product leadership customer value proposition. According to Noreen, Brewer and Garrison (2011), companies may offer their customers more than one of these propositions. Mainly, think that they fall under the product leadership customer value proposition. Even though they have customer feedback and have done research on the other airlines on how to serve them, it is the product as well as the service that keeps people coming back. 2.
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.
Positive attitude was the main characteristic managers were looking for when hiring new employees. Employees were often rewarded with bonuses which encouraged the initiative. JetBlue´s positive attitude within its corporation were communicated by its airline policy “never canceling flights” and provided gift vouchers for delays even if those were due to uncontrollable factors. The early growth and expansions of the company led to an unstructured corporation. JetBlue´s fast growing business model escalated with a natural disaster caused by a snowstorm in 2007.