Porter’s Six Forces Analysis of
Commercial Airline Industry

Porter’s six forces analizis
Micheal Porter projected six forces model in capacity to analyze competitive strategy of the management in any industry. These six forces become crucial in the success of every single industry, because they allow managers to measure and control every aspect of their business. A quote from Michael “The collective strength of these forces determines the ultimate profit potential in the industry.” Forces that are known as threats of new entrants, rivalry among existing firms, threat of substitutes products or services, barging power of buyers, barging power of suppliers, and relative power of the state holders. This forces will be use to analyze the airline industry.
Threat of New Entrants: Low
The purpose of a new entry for a business is the opportunity to reach new horizons, the chance to moves up to the next level in profitability. The most popular thought regarding this industry, is that buying or leasing airplane is a mission impossible. Looking depply Into this industry, we can find a lot of obstructions that make it difficult for a company to succeed. the space for newcomers is squeezed, the high cost of industry because it is one of the most expensive and complex industry in terms of maintenance, the constant demand of highly and sophisticated technological systems to operate, the never end restriction from the government like air traffic, security, transportation. We can use Boeing to demonstrate the complexity of this industry, with their most recent scandal on their new Dreamliner craft which have been grounded for problems with lithium-ion battery aboard few plains. Boeing tries to expand their market, but the barriers of new entry are always there to make it harder.
Threat of Substitute Products or Service: Medium
In the airplane industry, when CEOs and