Swot Analysis Of Delta Air Lines

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In 2012, Delta Air Lines had emerged like the phoenix, from the ashes of a 2008, Chapter 11 bankruptcy to become the second largest airline worldwide. Through its network of operations, Delta provides air transport both domestically and internationally for cargo, mail, and passengers. In the past, Delta successfully utilized mergers and acquisitions to increase its market share and grow its existing service base. Since 2012, Delta has been aggressively seeking out new opportunities for further growth in a volatile market with high price elasticity and low brand loyalty. The 2008 merger with Northwest Airlines left Delta with higher long-term debt, making Delta vulnerable limited debt assumption required for future growth. Two rather simple…show more content…
Delta can utilize these current benefits to emerge as a lower-cost option through its increased buying power and lower overhead costs, allowing Delta to gain higher margins while maintaining competitive pricing with its main two competitors, American Airlines and United Airlines. Additionally, the efficiency of the reduced fuel and operations cost structure enables Delta to set its pricing lower than that of its competitors, which, in the end, will capture much of its competitor’s market share including that of its mid-line competitor US Airways. The increased buying power for fuel contracts will give Delta a competitive advantage should we see another spike in crude oil due to conflicts in the Middle East. Delta must also compete with the value pricing of its lower-end, economy competitors Southwest and Jet Blue. Southwest Airlines stands out in the pack and boasts, according to a customer satisfaction index, the highest customer satisfaction rating in the industry at 81% in 2011. Finding of Fact 2 Delta is forced to compete with low-cost carriers. As the old adage goes, “if you can’t beat them, join them”. Delta’s current business model makes it incredibly difficult to compete with low-cost airline carriers. The acquisition of Southwest would not center on product differentiation but rather as “the product” or commodity when compared to Delta’s competitors. Delta has long proved that it is incapable of merging with or sustaining a low-cost airline. The
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