Low-fare Airlines Research Articles

What Policies Airlines in Malaysia Adopt do to Achieve Competitiveness

The purpose associated this work is to examine the adopted polices and measures by the Airlines in Malaysia. The rebirth of this carrier was in the aftermath of September 11, 2001 tragedy crisis and terrorist attack in New York. Air Asia has succeeded in turning around in the airline industry from a losing airline into a strong growth and profitable airline, especially in having a track record of achieving success during an extraordinary difficult period for the airline industry, that was caused by the adverse effect of terrorist attacks, the wars in Afghanistan and Iraq, the Severe Acute Respiratory Syndrome (SARS), tsunami incidence and rising fuel prices and insurance premiums. The Air Asia group strategically focuses on providing high frequency services on point-to-point short-haul routes within a three-and-half hour flight time from its domestic and international hubs. All these have been made available with the use of technology to meet its commitment for “Easy to Book, Easy to Pay, Easy to Fly” while reducing cost and increasing customers and market share. With that Air Asia cost per ASK1 is reducing every year and its cost per ASK is the lowest globally. Air Asia adopted the models of the very successful Southwest Airlines from the US and Ryan Air and Easy jet from Europe but with added emphasize on technology. Its successful and proven low-cost model in Malaysia was replicated across boarder. In 2004, Air Asia formed two successful joint ventures in Thailand and Indonesia as low fare airline. To date, the Air Asia Group has carried over 11 million passengers and currently operates over 100 domestic and international daily flights from its hubs. How to Cite this Article Pubmed Style Johar MGM, Mohd Shukri Ab Yajid, S.M. Ferdous Azam. Policies Airlines in Malaysia Adopt do to Achieve SRP. 2020; 11(1): 770-778. doi:10.5530/srp.2020.1.98 Web Style Johar MGM, Mohd Shukri Ab Yajid, S.M. Ferdous Azam. Policies Airlines in Malaysia Adopt do to Achieve http://www.sysrevpharm.org/?mno=128485 [Access: March 29, 2021]. doi:10.5530/srp.2020.1.98 AMA (American Medical Association) Style Johar MGM, Mohd Shukri Ab Yajid, S.M. Ferdous Azam. Policies Airlines in Malaysia Adopt do to Achieve SRP. 2020; 11(1): 770-778. doi:10.5530/srp.2020.1.98 Vancouver/ICMJE Style Johar MGM, Mohd Shukri Ab Yajid, S.M. Ferdous Azam. Policies Airlines in Malaysia Adopt do to Achieve SRP. (2020), [cited March 29, 2021]; 11(1): 770-778. doi:10.5530/srp.2020.1.98 Harvard Style Johar MGM, Mohd Shukri Ab Yajid, S.M. Ferdous Azam (2020) Policies Airlines in Malaysia Adopt do to Achieve SRP, 11 (1), 770-778. doi:10.5530/srp.2020.1.98 Turabian Style Johar MGM, Mohd Shukri Ab Yajid, S.M. Ferdous Azam. 2020. Policies Airlines in Malaysia Adopt do to Achieve Systematic Reviews in Pharmacy, 11 (1), 770-778. doi:10.5530/srp.2020.1.98 Chicago Style Johar MGM, Mohd Shukri Ab Yajid, S.M. Ferdous Azam. What Policies Airlines in Malaysia Adopt do to Achieve Competitiveness?. Systematic Reviews in Pharmacy 11 (2020), 770-778. doi:10.5530/srp.2020.1.98 MLA (The Modern Language Association) Style Johar MGM, Mohd Shukri Ab Yajid, S.M. Ferdous Azam. What Policies Airlines in Malaysia Adopt do to Achieve Competitiveness?. Systematic Reviews in Pharmacy 11.1 (2020), 770-778. Print. doi:10.5530/srp.2020.1.98 APA (American Psychological Association) Style Johar MGM, Mohd Shukri Ab Yajid, S.M. Ferdous Azam (2020) Policies Airlines in Malaysia Adopt do to Achieve Systematic Reviews in Pharmacy, 11 (1), 770-778. doi:10.5530/srp.2020.1.98

Expansion Strategies for Achieving Competitiveness among Airline Companies in Malaysian Territory

The aim of this study is to examine the strategies that are adopted by the airlines in the Malaysian territory. Air Asia was incorporated as a private limited company in Malaysia in 1993 and became Malaysia’s second national carrier in 1996 and officially commenced operations as a full-service domestic airline with only two aircrafts. The company was facing losses most of the time and eventually on December 8, 2001 the company was taken over by Datuk Tony Fernandez, a visionary leader who has no related experience in airline at all. He changed the business model and re-launched Air Asia as a low-cost carrier. Air Asia became the first low-cost carrier to take to the skies in the region. Since the takeover in 2001 with only 2 aircrafts, Air Asia has revolutionized air travel in the region to become a leading low fare airline in South East Asia. It has achieved remarkable growth in all aspects of its business such as fleet grown to 28 now, recorded strong revenue growth from good passenger seat sales, as well as achieved strong profit growth and financial position. This case study would attempt to look at Air Asia’s key success factors and challenges faced and to propose suitable strategies for Air Asia to maintain its dominance. Some of tools employed include Ratio Analysis, PEST Analysis, Porter’s 5 Forces, Competitive Profile Matrix (CPM), SWOT Analysis, Internal/External Factor Evaluation Matrix, Stakeholders’ Analysis, BCG Matrix and TOWS Matrix. How to Cite this Article Pubmed Style Mohd Shukri Ab Yajid, Shakeerah Mohd Shukri, Ali Khatibi. Strategies for Achieving Competitiveness among Airline Companies in Malaysian SRP. 2020; 11(1): 761-769. doi:10.5530/srp.2020.1.97 Web Style Mohd Shukri Ab Yajid, Shakeerah Mohd Shukri, Ali Khatibi. Strategies for Achieving Competitiveness among Airline Companies in Malaysian http://www.sysrevpharm.org/?mno=128484 [Access: March 29, 2021]. doi:10.5530/srp.2020.1.97 AMA (American Medical Association) Style Mohd Shukri Ab Yajid, Shakeerah Mohd Shukri, Ali Khatibi. Strategies for Achieving Competitiveness among Airline Companies in Malaysian SRP. 2020; 11(1): 761-769. doi:10.5530/srp.2020.1.97 Vancouver/ICMJE Style Mohd Shukri Ab Yajid, Shakeerah Mohd Shukri, Ali Khatibi. Strategies for Achieving Competitiveness among Airline Companies in Malaysian SRP. (2020), [cited March 29, 2021]; 11(1): 761-769. doi:10.5530/srp.2020.1.97 Harvard Style Mohd Shukri Ab Yajid, Shakeerah Mohd Shukri, Ali Khatibi (2020) Strategies for Achieving Competitiveness among Airline Companies in Malaysian SRP, 11 (1), 761-769. doi:10.5530/srp.2020.1.97 Turabian Style Mohd Shukri Ab Yajid, Shakeerah Mohd Shukri, Ali Khatibi. 2020. Strategies for Achieving Competitiveness among Airline Companies in Malaysian Systematic Reviews in Pharmacy, 11 (1), 761-769. doi:10.5530/srp.2020.1.97 Chicago Style Mohd Shukri Ab Yajid, Shakeerah Mohd Shukri, Ali Khatibi. Expansion Strategies for Achieving Competitiveness among Airline Companies in Malaysian Territory. Systematic Reviews in Pharmacy 11 (2020), 761-769. doi:10.5530/srp.2020.1.97 MLA (The Modern Language Association) Style Mohd Shukri Ab Yajid, Shakeerah Mohd Shukri, Ali Khatibi. Expansion Strategies for Achieving Competitiveness among Airline Companies in Malaysian Territory. Systematic Reviews in Pharmacy 11.1 (2020), 761-769. Print. doi:10.5530/srp.2020.1.97 APA (American Psychological Association) Style Mohd Shukri Ab Yajid, Shakeerah Mohd Shukri, Ali Khatibi (2020) Strategies for Achieving Competitiveness among Airline Companies in Malaysian Systematic Reviews in Pharmacy, 11 (1), 761-769. doi:10.5530/srp.2020.1.97

Reliability assessment of a stochastic air transport network with late arrivals

With the rapid development of low-fare airlines with cheaper fares, the demand for safe and fast air-travel is growing. However, weather shocks, unpredictable situations, or mismatched interactions between related players sometimes impair the on-time landing of air transport networks. This work considers late arrivals and assesses the reliability of an air transport network and its performance indicator in terms of meeting the requested number of passengers under the time constraint. The available number of seats in each flight is regarded as stochastic owing to the number of seats that have been reserved by both travel agents and individual customers. An air transport network is thus formulated as a stochastic-flow air transport network with late arrivals, and all minimal itineraries feasible under the constraint of time are found through a depth-first search based approach. The reliability is derived from all flow vectors such that its capacity and tardiness-related valid conditions are not bounded while fulfilling the given number of passengers. Evaluating the reliability with considering late arrivals implies handling the rapid increase in flights for each tardiness level and facing the influence on the validity of each minimal itinerary. This study also contributes towards potential improvements in the reliability of air transport networks, which can benefit travel agents.

Can labor arrest the “sky pirates”? Transnational trade unionism in the European civil aviation industry

In a single European aviation market that is open to innovative new business strategies, most notably the (ultra) low-cost model developed by Ryanair, nonterritorial forms of sovereignty have been used to redefine employment relations, exert control over labor, and extract surplus value. Although aviation unions recognize the need to shift scale from a predominantly local focus on their national (flag) airline, they have yet to develop effective strategies at the supranational level as low-fare airlines continually extend their geographical reach in the open skies over Europe and beyond. Union strategies are considered at different levels (national and EU) as well as the different processes to enact these strategies (technocratic and democratic). Unions need to develop a Euro-democratization strategy if they are to arrest the anti-unionism and social dumping of European “sky pirates” such as Ryanair and Norwegian Air Shuttle.

Attribute Perception Mapping Services Domestic Airlines Using Correspondence Analysis

Positioning analysis provides a better understanding of the position based on the perception of passenger flights to service these attributes attached to each airline. This study aims to perform positioning of the domestic airline services based attributes, which characterize the airline based on the perception of consumers. Correspondence Analysis (CA) is used to determine the positioning of the six commercial airlines in Indonesia. The results of correspondence analysis showed that the airline Garuda, Lion Air, Citilink and Air Asia already has its own characteristics inherent in the minds of consumers, while the two other airlines, namely Batik Air and Sriwijaya Air has not had a special identifier. DOI : https://doi.org/10.21632/irjbs.8.1.59-67 Keywords: Positioning, Correspondence Analysis, Full Service Airline (FSA), Low Fare Airline (LFA

The influence of low-fare airlines on vacation choices of students: Results of a stated portfolio choice experiment

This paper reports the results of a portfolio model of vacation choices of students. The portfolio model concerns the combined choice of destination type, transport mode, duration, accommodation, and travel party for vacations. In addition to usual transport modes such as airline, train, bus and car, a distinction was made between low-fare airlines, as these may be especially appealing to students, and regular airlines. Stated choice data were used to estimate the model. The attributes of the transport modes were systematically varied in the experiment, while respondents were faced with free options for the other choice facets. Estimation results indicated that the developed model of portfolio choice performs satisfactory. In substantive terms, it seems that transport mode predominantly influences the portfolio choices. The attributes that are significant tend to amplify the specific role of transport modes in general and low-fare airlines in particular.

Student’s vacation travel: A reference dependent model of airline fares preferences

This article reports the results of student vacation travel choice analysis using a reference dependent model of airline fare preferences. Findings suggests, as expected, that the preferences/utility decreases with increasing levels of cost. The evaluation of the airfare, however, becomes significantly more critical in the regime were low-fare airlines are more expensive than the regular airlines, meaning that price sensitivity for low-fare airlines is higher in this case. Part-worth utility functions for airfare as part of a more general portfolio model of vacation decisions of students suggest that indeed a reference dependent model captures such regimes in utility space.

RYANIZATION: HOW ONE EUROPEAN AIRLINE EXEMPLIFIES THE “MCDONALDIZATION” MODEL

The low-fare airline business has dramatically changed the face of commercial aviation in Europe. The main idea and strategy of airlines following this approach is to focus on cheap fares rather than comfort for passengers. However, the majority of low-fare airlines do not simply copy a given system of their competitors; rather, they design their own strategy by implementing various elements which can be considered as “low-fare”-related. The authors of this article seek to lay a theoretical groundwork in the analysis of low-fare airlines. We employ the “McDonaldization” model of economic sociologist George Ritzer, which was heavily influenced by the German economist and sociologist Max Weber, to analyze cost-saving methods of the Irish airline Ryanair.The authors show how McDonaldization is able to mirror and describe this current trend in the aviation business. According to the results of this study, ‘Ryanair’ (and not its American counterpart Southwest Airlines often used as a synonym for low-fare airlines) is the airline which has most radically applied the low-fare idea.

Internationalization strategies of EU and Asia–Pacific low fare airlines

We employ Dunning’s eclectic paradigm (OLI) to shed light onto low fare airlines’ internationalization strategies. In addition to 31 European low fare airlines, we also analyze the internationalization strategies of 41 low cost carriers in the Asia–Pacific region. The results indicate that homogenous groups of such airlines emerge with regard to their internationalization strategies and that capital and ownership structure as well as relative timing is especially closely related to low fare airline’s entry modal choice. We discuss inferences for the use of the OLI paradigm in further studies of airline internationalization.

EasyJet® pricing strategy: Should low-fare airlines offer last-minute deals?

easyJet, one of Europe’s most successful low-cost short-haul airlines, has a simple pricing structure. For a given flight, all prices are quoted one-way, a single price prevails at any point, and, in general, prices are low early on and increase as the departure date approaches. We observe from these policies and from the empirical section of this paper that easyJet employs three distinct strategies: 1) it does not offer last-minute deals, 2) it offers a single class and lets price be the sole variable that controls demand, and 3) it varies the time at which tickets are first offered for sale (duration of sale). The first two policies are in stark contrast to traditional airline pricing strategies. Many airlines offer last-minute deals, either directly or via resellers. Second, the current prevailing practice is to control demand via seat allocation to various classes rather than by offering a single class and letting price be the sole variable that controls demand. The main objective of this research is to study the conditions under which offering a last-minute deal is optimal under the single-price policy. We also learn how the duration of ticket sales is affected by consumer characteristics. We find that, for an intermediate capacity level, uncertainty with respect to the arrival of the business segment will cause the firm to offer last-minute deals and thus partially price-discriminate within the tourist segment. The same is true for uncertainty with respect to the actual behavior of the firm: if consumers are uncertain whether the firm will offer last-minute deals, then, in equilibrium, both in a one-shot game and in a repeated game, the firm will, with some probability, offer such deals. In addition, we found that for an intermediate capacity level, the larger the number of segments (that differ in price sensitivity), the longer the duration of the period in which tickets are offered for sale.

When being the lowest cost is not enough: Building a successful low-fare airline business model in Asia

Following the success of budget airlines in Australia, regulatory barriers were eased elsewhere in Asia Pacific to allow the proliferation of low-fare airlines (LFAs). The aim of this paper is to assess whether the profit and growth potential of Asian LFAs are hampered not just by remaining regulatory barriers but also by the embedded revenue and cost advantages of their full fare rivals. The LFAs business model can survive and succeed in Asia so long as these companies can ensure an even lower operating cost than their already cost-efficient full-service rivals. LFAs based in low-income countries with a relative lack of viable land transport infrastructure (e.g. Malaysia) are likely to achieve the greatest market stimulation.

Special Issue Papers: Revenue management performance in a low-fare airline environment: Insights from the Passenger Origin—Destination Simulator

The growth of low-fare airlines has led researchers and network airlines alike to question the validity of existing pricing and revenue management strategies in the changing competitive environment. Given the less restricted fare structures offered by low-fare new entrant carriers, the revenue benefits of existing revenue management systems are likely to be affected. The Passenger Origin—Destination Simulator (PODS) is used to evaluate the changes in airline revenue management system performance in a hypothetical network served by incumbent network carriers and a low-fare new entrant airline. Simulation results show that, while incumbent network carrier revenues are indisputably reduced by low-fare entry, the incumbents and low-fare new entrant alike realise substantial benefit from the use of revenue management. Furthermore, the incremental revenue gains from the use of network revenue management (relative to leg-based revenue management) are very robust to changes in the competitive environment.

Low-fare airlines are on their way to make a major breakthrough in the Swedish market

Low-fare airlines are on their way to make a major breakthrough in the Swedish market

Low-fare airlines are on their way to make a major breakthrough in the Swedish market

Low-fare airlines are on their way to make a major breakthrough in the Swedish market

The limits of price leadership: needs-based positioning strategy and the long-term competitiveness of Europe’s low fare airlines

This article argues that a strategy of low operating costs and cheap prices is not sufficient in and of itself to establish long term competitive advantage for a growing company. Companies also need to leverage their distinctive corporate capabilities and unique experiences. In the case of service sector companies such as airlines, capabilities derive from the relationship which exists between the company, its employees, and its customers, as well as the reputation which is gradually established on the basis of reliability and quality of service. Unique experiences arise from the corporate culture and route network which an airline builds over time.