Airasia Strategic Management Report

2495 Words Nov 11th, 2010 10 Pages
AirAsia Strategic Management Report

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SWOT analysis of AirAsia

Strengths
Firstly, Air Asia has indeed a strong management team. This is clearly known as it has very strong links with the governements and airline industry leaders.This is partly contributed by the diverse background of the executive management teams which consists of industry experts and ex-top government officials.
For example, Shin Corp (formerly owned by the family of former
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Opportunities
It can be seen that there are about 2 major events that are taking place now or going to take place in less than 6 months from now. Firstly, it is the ever increasing oil prices. Secondly, is the “ASEAN Open Skies” agreement that has been reached.
In the first case, he increasing oil price at the first glance may appear like a threat for AirAsia. But being a low cost leader, AirAsia an upper hand because its cost will be still the lowest among all the regional airlines. Thus, AirAsia has a great opportunity to capture some of the existing customers of full service and other low cost airline’s customers. However, there will be also some reduction in overall travel especially by casual or budget travellers.
Secondly, the “ASEAN Open Skies” allows unlimited flights among ASEAN’s regional air carriers beginning December 2008. This will definitely increase the competition among the regional airlines. However, with the “first mover” advantage as well as its strengths in management, strategy formulation, strategy execution, strong brand and “low-cost” culture among its workforce, this agreement can be seen as more of an opportunity.
Collectively, the population of Asian middle class will be reaching 700 million by the end of 2010. This would create a larger market and a huge ooportunity for all low costing airlines in the region, including AirAsia. Also, there may be an alternative opportunity to partner with other low
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