Problem

Declining Operating Revenue

Fuel-hedging activities are ineffective in reducing fuel
expenses
Strategic Objectives
Best place to work
Safest & most reliable airline
Offer a convenient flight schedule
Offer best travel experience.
Maintains a low-cost structure
Offer low fares
Political
Safety & Security training requirements
Government agencies rules & regulations
Declining airline traffic due to terrorist attacks
Economical
Economywide Recessions
Industry Downturns
Increases jet fuel price
Fare wars
Social
Access to affordable air travel
Employee & customer relationship
Time-sensitive & price-sensitive travelers
Fear of Flying
Technological
Online ticket sales
Mobile website & app
next-generation technology and software
Airlines Gratitude Initiative
Inflight Internet service
Environmental
Reuse & recycle material
Climate Change Agreement
Environmentally Clean Method of Transportation
Air Travel Emissions Standards
Eliminating waste & conserving resources
Legal
Legal & Regulatory battles
Airline Deregulation Act in 1978
Wright Amendment
Threat of new entrants - Low
Large Capital Requirement
Economy of Scale Needed to be Profitable
Rivals attempts to undercut new entrants
Threat of substitutes - Low
Bus, automobile, train & public transportation
Dominates short distance travel
Substitute are inferior
Time
Speed
Comfort
Inefficient at long-distance support our travel
Bargaining power of customers -
High
No differentiation in service provided
Travel cost influence customer decision
lack of differentiation
Bargaining power of suppliers - High
Few large suppliers: Air bus & Boeing
No control over jet fuel price
Labor Unions
Airports locally owned and operated
Industry rivalry - High
Acquisition & Merger
Price competition
Limited differentiation