Due to exogenous shocks like the 1973 oil crisis or the 2001 terrorist attacks as well as the 2003 Iraq
war the worldwide Air Transport Industry faces its most severe crisis in its history. Many companies
since then downsized their workforce and even European flag carriers like Swissair and the Belgian
Sabena did not succeed to re-invent themselves, went bankrupt and so out of business.
The business and social world is getting more and more mobile, individual and flexible – and so the
people’s lives are determined by a high desire for mobility and travelling.
Table of Contents
- The European Airline Industry - Current Overview
- SWOT-Analysis
- Internal analysis: Strengths and Weaknesses
- Strengths
- Weaknesses
- External analysis: Opportunities and Threats
- Opportunities
- Threats
- Core strategies
- Strengths and Opportunities
- Strengths and Threats
- Weaknesses and Opportunities
- Weaknesses and Threats
Objectives and Key Themes
This paper analyzes the competitive challenges faced by European flag carriers in the early 2000s. It utilizes a SWOT analysis framework to evaluate the internal strengths and weaknesses of these airlines, as well as the external opportunities and threats presented by the market landscape. The primary objective is to understand how flag carriers can survive and adapt in a rapidly changing industry dominated by the rise of low-cost carriers (LCCs).
- The impact of low-cost carriers on the European airline industry
- The strengths and weaknesses of flag carriers in comparison to low-cost carriers
- Opportunities and threats presented by the changing market environment
- Potential core strategies for flag carriers to maintain competitiveness
- The importance of understanding consumer preferences in strategic decision-making
Chapter Summaries
The European Airline Industry - Current Overview: This chapter sets the stage by outlining the challenges faced by the global air transport industry, particularly focusing on the impact of exogenous shocks like the 1973 oil crisis and the 2001 terrorist attacks. The chapter highlights the bankruptcy of flag carriers such as Swissair and Sabena, demonstrating the industry's vulnerability. It introduces the rise of low-cost carriers (LCCs) like Ryanair and easyJet as significant competitors, emphasizing their success in meeting market demand through low-cost strategies. The chapter underscores the need for flag carriers to adapt their strategies to compete effectively and understand consumer preferences regarding destinations, pricing, and service quality. The growth of the industry, despite economic losses, is also highlighted, leading to the conclusion that a SWOT analysis is necessary for survival.
SWOT-Analysis: This section provides a comprehensive SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis for European flag carriers. It dissects the internal attributes of these airlines, highlighting their strengths such as high-quality service, brand prestige, well-established networks, and frequent flyer programs. Conversely, the analysis reveals weaknesses including high ticket prices, bureaucratic processes, and operational inefficiencies compared to LCCs, particularly in short-haul flights. The external environment is analyzed, pointing out opportunities like deregulation and increasing demand but also threats like exogenous shocks (e.g., terrorism), and the pricing pressure from LCCs. This section lays the foundation for formulating appropriate core strategies for flag carriers to navigate the competitive landscape.
Keywords
European airline industry, flag carriers, low-cost carriers (LCCs), SWOT analysis, competitive strategy, deregulation, consumer preferences, pricing, service quality, network carriers, hub-and-spoke network, frequent flyer programs, exogenous shocks, terrorism, business travelers, market share.
European Airline Industry Analysis: Frequently Asked Questions
What is the main focus of this document?
This document provides a comprehensive analysis of the competitive challenges faced by European flag carriers in the early 2000s. It uses a SWOT analysis to examine their internal strengths and weaknesses and the external opportunities and threats in the market. The primary goal is to understand how these airlines can survive and adapt in a rapidly changing industry dominated by low-cost carriers (LCCs).
What topics are covered in the Table of Contents?
The table of contents includes: an overview of the European airline industry, a SWOT analysis (internal strengths and weaknesses, external opportunities and threats), and core strategies based on the SWOT analysis findings.
What are the key objectives and themes explored?
The key themes explore the impact of LCCs, compare the strengths and weaknesses of flag carriers versus LCCs, analyze opportunities and threats in the changing market, suggest core strategies for flag carriers to remain competitive, and emphasize the importance of understanding consumer preferences in strategic decision-making.
What does the chapter on "The European Airline Industry - Current Overview" cover?
This chapter introduces the challenges of the global air transport industry, focusing on the effects of events like the 1973 oil crisis and the 2001 terrorist attacks. It highlights the bankruptcies of some flag carriers, showcasing the industry's vulnerability. The rise of LCCs and their success are discussed, emphasizing the need for flag carriers to adapt their strategies to remain competitive. The chapter concludes that a SWOT analysis is crucial for survival.
What is the focus of the "SWOT-Analysis" section?
This section provides a detailed SWOT analysis for European flag carriers. It examines internal strengths (e.g., high-quality service, brand reputation) and weaknesses (e.g., high ticket prices, inefficiencies). It also analyzes external opportunities (e.g., deregulation, rising demand) and threats (e.g., LCC competition, exogenous shocks). This analysis sets the stage for developing effective strategies.
What are some key strategies suggested for flag carriers?
While specific strategies aren't explicitly detailed, the SWOT analysis lays the groundwork for developing strategies that leverage strengths and opportunities, mitigate weaknesses, and counter threats. The analysis implies that strategies should consider adapting to consumer preferences regarding pricing and service quality, enhancing efficiency, and potentially focusing on areas where LCCs are less competitive.
What keywords are associated with this analysis?
Keywords include: European airline industry, flag carriers, low-cost carriers (LCCs), SWOT analysis, competitive strategy, deregulation, consumer preferences, pricing, service quality, network carriers, hub-and-spoke network, frequent flyer programs, exogenous shocks, terrorism, business travelers, and market share.
- Quote paper
- Martin Fett (Author), 2010, A SWOT Analysis for the “flag-carriers”, Munich, GRIN Verlag, https://www.grin.com/document/173064
