Organizational Competitive Strategies-Porter's Five Forces Model (AIR ASIA)

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The Porter’s five forces model, in this assignment, can be used to access the competitiveness of the airlines industry. It can review the competition within the industry plus checks for threat from outside.

Bargaining power of supplier-High- In every industry, there has to be someone to play the role of a supplier. It is important to know the power of the supplier as it will affect the industry. There are only two main suppliers in the airline industry, Airbus and Boeing, thus there isn’t much of an open option. Not forgetting the global economic catastrophe which has limited the new entry of competitor plus reducing the necessity of upgrading of planes in near future. However, both suppliers grant almost similar standard aircrafts;
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Indirect substitute are ferry, bus and further forms of transportation except from airline, while direct substitute are the other rival airlines. Consumers usually go for those that cost less. If the trip covers a short distance and mainly connected to the peninsula then forms of transport will include train, bus or air travel. However if the trip is budgeted the preferable choice would be by bus. Moreover the development in technology has highly contributed in this matter by making ticketing and pricing of air tickets available to travelers on the internet and also allowing them to compare the rates. Even if the travelers may prefer to take a bus or train to their preferred location such as travelling from Kuala Lumpur to Bangkok, it is still an undeniable fact that air travel is much more convenient and consumes less

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