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Continental Airlines Essay

6325 words - 25 pages

Question #1Describe the Dominant Economic Characteristics of industry.The Dominant Economic Characteristics of the industry are: -Since air travel remains a large and growing industry, it helps in the progress of economic growth, world trade, international investment and tourism, and is therefore central to the globalization that is occurring in many other industries. Therefore, I would have to agree that the airline industry is easy to enter into. Furthermore, the industry is very mature because it is overly saturated with a plethora of companies striving to provide the best air travel service to the masses.In light of current events taking place in the world, major airlines are facing significant losses; however, airlines are finding ways to survive despite their setbacks because people need air transport. For instance, on the wake of September 11th, airlines started borrowing money to cover daily losses that they incurred, cutting flights and fares, laying off employees, and instituting a host of security measures for protection.Also, the airline industry has been the subject of intense price competition since it experienced deregulation, and the result has been a number of new carriers that specialize in regional service and no-frills operations. These carriers basically purchase older airplanes and often operate outside the United States to other international countries and regions.Question #2Describe the major Driving Forces of the Industry.The major Driving Forces are: -Growing use of the Internet and emerging new technology applications - With this concept, Continental Airlines opted to venture out and introduce and implement a website of its own www.continental.com to provide a more upscale conduit to purchasing tickets and better assisting customers with whatever they may need. This boosted the company's marketing strategy and it also afforded potential flyers a sneak preview of what they should expect in terms of "ultimate" service. Another brave move Continental made was joint venturing with companies such as United, Delta, American, and Northwest to make the experience more worthwhile; the companies' website was a collective effort called www.orbitz.com - this allowed visitors to compare each of the companies' prices and in my opinion, it was basically a win- win situation.Increasing globalization of the Industry - Continental shifted from providing service within the US to expanding into international regions. For instance, with the "Fly To Win" (fly where people wanted to go) market plan, Gordon Bethune (CEO) wanted the business to prosper so he slowly but surely added more options for customers to chose from in terms of destinations; most notably, the expansion into international markets was rather aggressive because he wanted to gain market share and customer loyalty. According to C-499, some of the regions that Continental ventured into were Hong Kong, Tokyo, Guam, Rome, Milan, Tel Aviv, and the Caribbean just to name a few....

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