The Strategy Of Airasia X

1236 WordsFeb 17, 20175 Pages
Problem Statement In 2001, AirAsia was founded by Tony Fernandes. After six years, Fernandes realized the company should create a airline separated from AirAsia to focus on the low cost long-haul market which he called AirAsia X. Azran Osman-Rani was appointed to the become the CEO of the newly established company. The company had an initial success by being the first mover. However, there were some problems that they had to face along the way as they were in a completely new market using an untried business model. One of the main challenges for the company is the protectionist measures taken by the Malaysian government to protect the national airline, Malaysia Airlines (MAS). The other major problem is the limitations on the general…show more content…
This helped X to increase the seating capacity by 20 percent. X also had a flexible flight schedule as its aircraft was in the air for 16 hours per day in average, which is much higher than the industry average of 11 hours per day. SWOT Analysis AirAsia X’s main strength is the low price that it offers for customers. For most airlines in the industry, it is extremely difficult to keep the price low for long-haul flights as the full services offered in most airlines increase the operating costs. In addition, X also benefited from the expansive network, infrastructure and customers that AirAsia already has that enabled them to grow fast with good financial outcomes. On the other hand, X’s main weakness is the technology. The website always crashes and the company doesn’t have its own database of customers. X also doesn’t enjoy from a strong relationship with the Malaysian Transport Ministry. This can be detrimental to the company as it finds competing with Malaysia Airlines in some profitable routes to be difficult. However, X has some opportunities. For example, in order to keep the low price ticket, cooperating with fuel companies which will offer low fuel price and increasing demand in low cost airlines will bring profits. The major threat for AirAsia X is the protectionist measures taken by the Malaysian government that prevented X from flying planes to some destinations with high demand. This would have been a very

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