Transglobal

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2011 STUDENT CASE COMPETITION
The Student Case Competition is sponsored annually by IMA® to provide an opportunity for students to interpret, analyze, evaluate, synthesize, and communicate a solution to a management accounting problem.

TransGlobal
Airlines
By Shane Moriarity, Laura Hopkins, and Andrew Slessor

“We are facing a major change in our firm’s operating environment,” the CEO of TransGlobal Airlines declared at the opening of a hastily called executive committee meeting.
“We need to adopt a survival strategy, now!
Noah built the ark when the weather was fine. He didn’t wait for the rain to come.”
44
44

S T R AT E G I C F I N A N C E

I

August 2010

T

ransGlobal Airlines is the government-owned,
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Similarly, we serve only one city in each of our international destinations.
The competitive change that will occur is that the reciprocal carriers will be offered ‘beyond rights’ so they can serve any of our destinations. This right will include carriage of passengers from one domestic city to another.
The offer of ‘beyond rights,’ of course, will be subject to our gaining similar rights in the corresponding international market.
“In my opinion, we have one of two ways to go. We can try to be a major, full-service carrier, or we can focus on being a low-cost carrier for our local markets. We need to

Figure 1: TransGlobal Airlines
Route Map

CDG

FRA

ROM
WIN
LHR

IST

BLA
LOV
BUR

PLE

SOF

VLD

RUS

VTA

NES
GAB

VAR

PLO

JAM

SIL

KAR
MAS

SUM
SLI

International Route

46

S T R AT E G I C F I N A N C E

I

August 2010

TOL

TAR

Large-City Route

Regional-City Route

Table 1: TransGlobal Airlines
Daily Flight Schedule
ALL FLIGHTS OPERATE 365 DAYS PER YEAR

HOME CITY

SOF

DESTINATION

ONE-WAY
DISTANCE
(MILES)

MARKET
SEGMENT*

EQUIPMENT**

ANNUAL
PASSENGERMILES-FLOWN
(MILLIONS)

ROUND-TRIP
FLIGHTS
PER DAY

CDG

2,800

I

JJ

1

480.3

FRA

2,500

I

JJ

1

465.3

IST

1,800

I

JJ

1

329.8

LHR

3,200

I

JJ

1

630.7

ROM

1,200

I

JJ

1

223.3

WIN

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