Micheal Porter projected five forces model in capacity to analyze competitive strategy of the management in any industry. These forces hold an exigent spectrum of importance in the airline industry because of enormous market saturation. The concentration of airline service providers in the market are more than the actual needed demand. Due to immense competition, the level of competition is enhanced within the complex market offering in terms of technology, prices, in-flight entertainment, customer services, and so on. Hence, this paper is presented to analyze the Porter’s five forces model in the horizon of airline industry. Porter has also given the more enhanced framework of forces by including the sixth force as well, which will subsequently be analyzed according to said industry.
Porter’s Six Forces Model Analysis
The extension of Porter’s five forces model is actually regarded as Porter’s six forces model. The enhanced stimuli of forces did not gain such popularity as that of its previous model integrating five forces only, because of its less positive acceptance. The model is similar to the five forces model with only difference of sixth force in the framework. Hence, all Porter’s (1980) forces are explained below with their certitude rating in the parameters of airline industry.
Force 1: Threats of New Entrants
The threat of new firm into the same industry is the force which describes the dependability of new entrants on the entering barriers. These barriers are a kind of great threat to any industry, if they are feasible and flexible because it will increase the number of potential competitors in the industry and on the contrary they can react in diverse manner to the potential entrants to replicate the incumbents’ position. These barriers may exist within economies of scale, distribution channel, cost of entry, government legislation and product