Strategic Alliances In Aviation Industry Essay

1600 words - 6 pages

Strategic Alliances in Aviation Industry: An Assessment of perception of business travellers and benefits of international network development as derived by airlines operators

Proposal Summary
The proposed study is aimed at identifying the reasons and success factor of increasing alliances being witnessed in airlines sector. Strategic alliances have proven to be successful in other sectors like manufacturing and automobiles but the effectiveness of these alliances in aviation sector are a less researched area. The study will discuss the peculiarities of the sector and reasons that make alliances possible for development of an international network. The results will provide detailed information about the impact of strategic alliances on performance of companies and passengers and the level of satisfaction derived from the increased services after alliance. The secondary data will be used to analyse the profitability of airlines after entering into some kind of strategic alliance. We will focus on two major alliance in aviation sector namely Star Alliance and One World to reach the answers of research questions.
(overall a good proposal where we are experiencing various alliances such as Etihad with Darwin Airline and Air Serbia ;

Literature Review
Since airlines have historically shown poor performance, it has been suggested that airline business is not cyclical business but bad business (Das, 2011). Indeed, the combined net profit margins of United States airlines, for instance, have typically been only about half of the Standard and Poor’s 500 list of industrial, utility and transportation companies’ net profit margins (ibid.). For several years the airline industry has been very turbulent and has been through financial ups and downs. Alliances in the industry can partly be seen as a response to the uncertainty and risks associated with industry turbulence, in other words, alliances are seen as a way of improving performance in terms of hardening competition (Gracia, 2012).
Since1990s the alliances in airlines sector has remained some of the most critical advents of the industry (Kleyman, 2010). A rich and evolving literature has been develop since then making it easy to understand the implication of alliances on management of airlines as well as on customers of the airline operators. With the change in millennium, there has remained the dominance of three major Global Airlines Alliances and the issues associated with impact of such alliance on price and competition, revenue and marketing innovations and operations of the airline companies (Rhodes and Lush, 1997).
A comprehensive literature has been provided by Latour and Oretti (2007) about the opportunities and challenges for companies in relation to alliances and mergers. A survey conducted by these researchers’ studies the impact of alliances on airlines and revealed that code share is the most productive result helping in increasing traffic in airlines sector.
A rigorous...

Find Another Essay On Strategic Alliances in Aviation Industry

The Paradox of Cooperation and Competition in Strategic Alliances: Towards a Multi-paradigm Approach.

7258 words - 29 pages AbstractCooperation and competition characterise the interfirm relationships in strategic alliances. This paper proposes a paradox approach to studying cooperation and competition. It explains the paradox perspective and provides an analytic framework for the paradox of cooperation and competition. In the light of the paradoxical nature, it advocates a multi-paradigm approach to cooperative and competitive strategies, which combines strategic

Microeconomics in Aviation Industry Essay

1179 words - 5 pages decision makers' generalized attitudes and beliefs in the modeling process begins to open the black box that governs choice behavior. The results of our analyses demonstrate that general aviation pilots make decisions about airport use as reasoned adjustments to airport features that either increase or decrease the pilot's expected value or utility for the airport. The findings, moreover, show that pilots find some airport attributes to be

avaitionindustry analysis

1684 words - 7 pages carriers establish route 50.74 million passenger max. in 2006Current Scenario of Indian Aviation IndustryIndia completed 100 years in aviation sector on 18 February, 2011.The Indian Aviation Industry is one of the fastest growing aviation industries in the world.454 airports and airstrips; 16 designated international airports.With the liberalization of the Indian aviation sector aviation industry has undergone rapid transformationBeing primarily a

Environmental Scan

1151 words - 5 pages Cessna became a threat in its own because the aviation was just starting out. Competition from other resources in the industry would guide Cessna toward documentation of the many innovative ideas set in the company. The alliances with different organizations also indeed gave Cessna the opportunities to advance competitively. One example of an alliance is the current parent company Textron who started out as an external alliance and is currently a

The global logic of strategic

2633 words - 11 pages INTRODUCTION The topic under review is strategic alliances. This particular form of non-equity alliance between firms in the same industry (competitors) is becoming an increasingly popular way of conducting business in the global environment. Many different reasons of why such alliances are occurring have been recognised. These include: the increasing globalisation of the world's economy resulting in intensified global competition, the

Economics Essay on Emirates Airlines

871 words - 3 pages airlines, 23,000 aircraft and 3700 airports. With negligible switching costs, budget airlines pose a threat. However, airlines defend themselves by differentiating their services or forming strategic code sharing alliances with other airlines A strategic partnership that Emirates stroke with Qantas airlines in 2013 gives the airline a distinct advantage over other Middle Eastern airlines. The partnership will see Emirates passenger load factor

Crew Resource Management Airline industry Aviation Safety

4739 words - 19 pages defensive measures rather than profit centers- only time will tell. Formation of Key Strategic Alliances The formation of alliances in the airline industry have helped both consumers and the airline industry immensely. According to James Goodwin, the CEO of United Airlines, various alliances have contributed around $200 million in additional revenues and cost savings. One of the most successful contributors to the additional revenues is the Star

Star Alliance: strategic issues

2434 words - 10 pages market competition.Deregulation ushered in alliances between many domestic and international carriers designed to increase routes. This "open skies" environment saw a free flow of travelers around the world. However, terrorism, a worldwide recession, and the Gulf war slowed air traffic by 25% (Bartlett, Ghoshal, & Birkinshaw, 2004). The terrorist's attack on September 11, 2004 dealt the airline industry another blow. With increased costs because

Qantas PESTLE Porters Five Forces

2344 words - 9 pages and Porter's Five Force frameworks, this report will assess Qantas' opportunities and strengths within the aviation industry. In addition to this, the report will focus on the specific resources and capabilities that enable Qantas to obtain a competitive advantage over its competitors through the use of the VRIO framework. A final analysis will be conducted to identify issues Qantas face and recommendations of how they can rectify these

Analysis of Southwest Airlines

884 words - 4 pages major carrier to the USA accounting for about 85% of its airfreight tonnage, but it also operates scheduled services to South Africa, Japan and Hong Kong. The subject of strategic alliances inside the air transport industry is not a well-researched area. This is due, in part, to the truth that alliances are a nearly new happening in the industry. The 1990s in specific have seen a commotion of alliance activity of all descriptions. When Southwest

ICAO - The International Civil Aviation Organisation

1175 words - 5 pages of all people. It is made up of 6 principle organs: Trusteeship Council, Security Council, General Assembly, International Court of Justice, Economic and Social Council and Secretariat. ICAO’s main role is the creation, modernisation and implementation of universally accepted standards for use in international civil aviation and assisting in the planning and development of international air transport to ensure the industry remains safe

Similar Essays

Strategic Alliances In Technological Innovations Essay

4755 words - 19 pages alliances.2.0 TYPES OF STRATEGIC ALLIANCESStrategic alliances can either be intra- industry or inter industry. Intra-industry means forming alliances with other firms in the same industry while inter-industry involves alliances with firms from other industries.The alliances can be between non competitors or competitors. Non-competitors will form an alliance in order to share specific expertise and capabilities, while competitors will work together to

Discussion Surrounding Global Alliances Operating In The Airline Industry

1587 words - 6 pages The international aviation industry is arguably one of the most competitive and cut-throat businesses in the world today. Characterised by high revenue but notoriously thin profit margins, modern international airlines are constantly searching for methods to gain advantages over their competitors and attract new customers. One of these methods which has become popular since the late 1990s is that of the global airline alliance. Today there are

Particular Skills And Abilities Needed To Develop In A Department That Specializes In Strategic Technology Alliances

1190 words - 5 pages question remains: What can managers do to improve the effectiveness of their strategic partnerships?What is strategic alliance?To begin, we must have a definition of strategic alliance. In her book, Intelligent Business Alliances (3, p.4), author Larraine Segil defined an alliance as "a relationship that is strategic or tactical, and that is entered into for mutual benefit by two or more parties having compatible or complementary business

The Paradox Of Cooperation And Competition In Strategic Alliances Towards A Multi Paradigm Approach

7012 words - 28 pages AbstractCooperation and competition characterise the interfirm relationships in strategic alliances. This paper proposes a paradox approach to studying cooperation and competition. It explains the paradox perspective and provides an analytic framework for the paradox of cooperation and competition. In the light of the paradoxical nature, it advocates a multi-paradigm approach to cooperative and competitive strategies, which combines strategic