Air Asia

1125 words 5 pages
NATURE OF BUSINESS

Air Asia leading airline was established with the dream of making flying possible for everyone. Since 2001, Air Asia has swiftly broken travel norms around the globe and has risen to become the world’s best. With a route network that spans through to over 20 countries, Air Asia continues to pave the way for low-cost aviation through our innovative solutions, efficient processes and a passionate approach to business. Together with our associate companies, Air Asia X, Thai Air Asia, Indonesia Air Asia, Philippines Air Asia and Japan Air Asia.
Focusing on the low-cost, long-haul segment - AirAsia X was established in 2007 to provide high-frequency and point-to-point networks to the long-haul business. AirAsia X’s cost
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The threat of a substitute is quite low as Air Asia has a network that spans through more than 20 countries. Air Asia is the leading low-cost carrier, connecting people and places across 132 routes, 40 of which are offered by no other airline. To achieve this kind of network it is going to take a lot of time and money. * Government Legislation
Government policy can hinder or aid new entry directly, as well as amplify the other entry barriers. Government directly limits or even forecloses entry into industries through, for instance, licensing requirements and restrictions on foreign investment. * Bargaining Power of Suppliers
Every industry has someone to play the role as suppliers. Power of the supplier’s is important as it will affect the industry. In airline industry, the power of suppliers is quite high since there are only two major suppliers which are Airbus and Boeing hence there are not many choices to airline industry. Nevertheless, the global economic crisis has limited the new entrant and also reducing the upgrade of planes in the immediate future. However, both suppliers provide almost same standard aircrafts and hence the switching to Air Asia is low.

MACRO ENVIRONMENT
The macro environment consists of the larger societal forces that affect the microenvironment such as - political, economic, social and technological factors. By using a PEST analysis we can study the external Macro environmental factors that affect the firm.

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