BestJet B: The European budget airline industry: origins, growth, market and competition May 2006 __________________________________________________________________ Allan Kinross prepared this case. It is intended to be used as a basis of class discussion rather to illustrate the effective or ineffective handling of an administrative situation Introduction to the European budget airline industry After 9 years of spectacular growth
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STRATEGY Ryanair’s objective is to firmly establish itself as Europe’s leading low-fares scheduled passenger airline through continued improvements and expanded offerings of its low-fares service. Ryanair aims to offer low fares that generate increased passenger traffic while maintaining a continuous focus on cost-containment and operating efficiencies. The key elements of Ryanair’s strategy are: Low Fares. Ryanair’s low fares are designed to stimulate demand, particularly from fare-conscious leisure
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(high-medium price), and Fairfield Inn (low prices). Firms devise their branding strategies to help convey the price quality tiers of their products or services to consumers. The firm must consider many factors in setting its pricing policy. Following are the six steps in the process: STEP 1: Selecting the Pricing Objective The company first decides where it wants to position its market offering. The clearer a firm’s objectives, the easier it is to set price. Pricing objectives are goals that describe
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JETBLUE AIRWAYS IPO VALUATION Teaching Note This case examines the April 2002, decision of JetBlue management to price the initial public offering of JetBlue stock during one of the worst periods in airline history. The case outlines JetBlue’s innovative strategy and the associated strong financial performance over its initial two years. Students are invited to value the stock and take a position on whether the current $25–$26 per share filing range is appropriate. The case is designed
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Dogfight over Europe: Ryanair Group D Competitive Strategy Dogfight over Europe: Ryanair (A) This case addresses the airline industry’s context after World War II until late 1980. The case is mainly focused on Ryanair’s entrance to the airline market and its road to expansion. Brief description of airline industry context: Initially, the main players was Europe’s national governments, as a result of merging small private-owned airlines into national “flag carriers” (service focused on international
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Chapter 2: How Airline Markets Work...Or Do They? Regulatory Reform in the Airline Industry Severin Borenstein and Nancy L. Rose October 2008 Severin Borenstein is E.T. Grether Professor of Business Administration and Public Policy at the Haas School of Business, U.C. Berkeley (www.haas.berkeley.edu), Director of the University of California Energy Institute (www.ucei.org), and a Research Associate of the National Bureau of Economic Research (www.nber.org). Address: Haas School of Business
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Executive Summary Porter Airlines, a short-haul commercial airliner established in 2002, have enjoyed significant and steady growth since inception. The concern now is to devise a solution that will allow Porter to continue its controlled expansion strategy, as it has been so successful and integral to the growth of the company over the past several years. Situation Analysis Porter Airlines operates in a fiercely competitive airline industry, where competitors compete based on price, service
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RUNNING HEAD: THE AIRLINE INDUSTRY The Airline Industry Name College Table of contents Abstract 3 Introduction: 4 Products and services: 4 Organization: 4 Major players in the airline industry: 5 Economic impact of the airline industry: 8 Employment within the industry: 9 Key trends in the airline industry: 9 - Economic forces: 9 - Technological forces: 11 - Socio-cultural forces and political-legal forces / Government Regulations 13 Logistics and supply chain factors
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is a single seller of a good. Because of this, it has the power to set both the price and quantity of the good that will be sold. We begin our study of monopoly by considering the price that the monopolist should charge.1 9.1 Simple Monopoly Pricing The object of the firm is to maximize profit. However, the price that the monopolist charges affects the quantity it sells. The relationship between the quantity sold and the price charged is governed by the (aggregate) demand curve q (p). Note, in
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in business schools and commonly used by analysts. Porter's book, Competitive Strategy, provides an excellent, readable resource for understanding the impact of competitive forces on an industry. According to Porter, the five competitive forces affecting an industry are: threat of entry, competitive rivalry, bargaining power of suppliers, threat of substitutes, and the bargaining power of buyers. Let's use the airline industry as an example of how an analyst may interpret the competitive forces that
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