Swot Analysis For American Airlines

Delta Airlines was founded in 1920 in Ogdensburg, New York under the name: Ogdensburg Aeroway Corp, the company was founded by Elliot Daland and Thomas Duff. The company began as a crop dusting company which was the first of its kind (commercial agricultural). The name quickly changed to Huff-Daland Aero Corporation and in 1925 their headquarters moved to Monroe, Louisiana, USA. At the beginning of the corporation their fleet of 18 privately owned planes delivered mail and crop dusted all over the United States and was the largest fleet of aircraft in the world at the time. Flight operations ranged from all over the United

American Airlines has some key operational and financial strengths that keeps it ahead of its competitors in the airline industry.

With operating income of $801 million and revenue of $8.55 billion, American Airlines was the largest airline in United States as of 1988. As Airline Deregulation Act changed the environment of airline competition, American Airlines had to make some radical changes in its business. Because deregulation made the market more competitive than ever, American Airlines still has many strategical and tactical decisions to make in order to be one step ahead of its competitors. Although there are many issues that airline companies deal with in order to create competitive advantage such as costs, route structuring, distribution channels, customer service and marketing activities like loyalty programs, the most important decisions are to be made regarding revenue management activities.

Air Canada was formerly known as Trans-Canada Airlines and was born on the April 10, 1937. It all started with $5 million and three aircrafts; a crop duster and two Electras. The first passenger operations began on September 1, 1937. An Electra, carrying two passengers and mail, flew from Vancouver to Seattle, in 50 minutes. The tickets in 1937 cost about $7.90 one-way and $14.20 return.

American Airlines continuously strive to make a positive impact in the lives of customers, employees and shareholders, and in the communities and environments where they live, work and play.

American airline industry is steadily growing at an extremely strong rate. This growth comes with a number economic and social advantage. This contributes a great deal to the international inventory. The US airline industry is a major economic aspect in both the outcome on other related industries like tourism and manufacturing of aircraft and its own terms of operation. The airline industry is receiving massive media attention unlike other industries through participating and making of government policies. As Hoffman and Bateson (2011) show the major competitors include Southwest Airlines, Delta Airline, and United Airline.

After watching the CNBC special about American Airlines and a week inside their business I noticed several interesting things. Though it was dated few years ago many of the issues are still the same. They had several Revenue drivers; Cargo income, excess baggage fees, last minute departure fees, Postal cartage, and miscellaneous charges for meals, drinks, and accessories. These are not needed but sometimes are needed on certain longer flights. They provide an extra income that may just keep a transcontinental flight from losing money.

American Airline profitabilty ratio has improved since the merger with US Airways. The stockholder return drop in 2015 because of low sales.

One great feature offered by American Airlines is the ability to take advantage of their off-peak seasons. When travel is slow, the airline will let you travel at a discount. For example, a flight to Hawaii that might cost 17,500 miles would only cost 12,500 miles if you choose the right date.

Strong brand equity - AirAsia’s brand name is well established in Asia Pacific (Learning Curve)

Airlines must operate within a low-margin, high-fixed-cost environment, making profitability particularly sensitive to decreases in volume, either from environmental factors (e.g., the September 11,2001 attacks) or from competition. Moreover, the airline business is labor-intensive. Labor costs as a percentage of revenues ranges from a low of about 25 percent for the low-fare airlines to almost 50

The airline industry is interpreted as being very unstable due to the immediate reaction to tragedies. The airline industry was affected following the September 11th tragedy and it affected other industries indirectly. The airline industry plays a key role in

4. Several major airlines filed for bankruptcy. Many airlines significantly decreased their capacity, reduced their routes and postponed purchases of new aircraft. Some airlines reported a 50% reduction in routes and flight frequency. All these events provided opportunities for the low-cost carriers not only to increase the number of flights but also to introduce services on new routes.

With 1988 operating income of $801 million on a revenue of $8.55 billion, American Airlines, Inc. (American), principal subsidiary of Dallas/Fort Worth-based AMR Corporation, was the largest airline in the United States. At year-end 1988 American operated 468 aircraft on 2,200 flights daily to 151 destinations in the United States, Bermuda, Canada, Mexico, the Caribbean, France, Great Britain, Japan, Mexico, Puerto Rico, Spain, Switzerland, Venezuela, and West Germany.

Southwest Airlines Co. (the “Company” or “Southwest”) operates Southwest Airlines, a major passenger airline that provides scheduled air transportation in the United States and near-international markets. For the 44th consecutive year, the Company was profitable, earning $2.2 billion in net income. Southwest commenced service on June 18, 1971, with three Boeing 737 aircraft serving three Texas cities: Dallas, Houston, and San Antonio. At December 31, 2016, Southwest operated a total of 723 Boeing 737 aircraft and served 101 destinations in 40 states, the District of Columbia, the Commonwealth of Puerto Rico, and eight near-international countries: Mexico, Jamaica, The Bahamas, Aruba, Dominican Republic, Costa Rica, Belize, and Cuba. The Company added its first three destinations in Cuba during 2016, with service to Varadero and Santa Clara from Fort Lauderdale-Hollywood International Airport and service to Havana from both Fort Lauderdale and Tampa International Airport. The Company also expanded its domestic footprint during 2016, with the commencement of service at Long Beach Airport, the Company’s fifth service point in the L.A. Basin and tenth airport in California. Based on the most recent data available from the U.S. Department of Transportation (the “DOT”), as of June 30, 2016, Southwest was the largest domestic air carrier in the United States, as measured by the number of domestic originating passengers boarded.