Research Paper on Airlines

Key Competitors

The main competitor of easy Jet's is Ryanair that was the largest European airline before the acquisition of Go Fly by the EasyJet. Both have the same number of routes. Other competitors of EasyJet are the Package Holiday airlines, Air Berlin, Air Frace, Lufthansa, and British airlines. There still exist some other smaller European Flags that compete with EasyJet in some routes like Iberia. The centurion Air Cargo is known to be one of the top competitors of IAG. This competitor is operating in Air Freight Transportation. Easy jet and IAG also are also known to compete for each other in the industry. (Belobaba, P., Odoni, A. R., & Barnhart, C. 2016).

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Peer Analysis

The graph below compares the primary and non-primary airports of Easy Jet, IAG and their competitors

Political Analysis

Many, airline in the UK including EasyJet and British Airways run in a challenging political environment. They are faced with some terrorist attack in their main destination markets including Nice, Paris, Turkey, and Brussel. Easyjet and British airlines having its parent company being the IAG welcome the governmental decision of UK regarding approval of third run Heathrow. The Heathrow Airways expansion has constantly received support from the EasyJet, and the airline understands that it would begin flying from the largest airport in the UK once the government decides to raise the capacity. (Boer, E. R. 2017).

Economic Analysis

Many airlines in the UK including Easy jet and the IAG airline received an economic impact in 2016 from the uncertainty of Brexit. From the annual report of that year, there was a benefit in revenues generated by Easy Jet in the overseas due to the depreciation of the sterling pound. There was also a significant benefit in the UK from the low-interest rates and fuel pricing and both Easy jet and British airways benefited. This resulted in the promotion of growth in their competition and market capacity.

Social Analysis

Easy Jet, IAG and other carriers have been experiencing social factors and in particular in the year 2016. The 2016 peak summer proved operational difficulties for these airlines carriers, and in particular, the air traffic controller strikes in France that resulted from social unrest from the socialist government about the disputed labor reforms. The strikes by the airline controller have appeared being the main social factors for these airlines since another five-day strike by French ATCs occurred in 2017 ( Conrady, R. et al. 2011). Both IAG and Easy jet airlines have sought to address the issue by petitioning the French government and EU to come up with an action to lower the impact of air traffic controllers on the passengers.

Technological Analysis

Currently, the airline industry is undergoing disruption as a result of technological changes. There is a constant improvement in technology, and such airline in the UK including Easy Jet and IAG airlines have been forced to adopt some of the improvement to manage the rising competition in the industry. Some of the new lost cost entrance like WOW air has appeared to challenge Easy Jet and IAG by adopting the digital technology including internet only booking systems which does not demand physical check-in infrastructure and advance fuel-efficient fleets (Great Britain., & Great Britain. 2012). As a result of the adoption of technological improvements by such airlines, they have appeared to outcompete IAG and Easy jet through the provision of cheap international and domestic flights to the customers.

Legal Analysis

The legal laws that are set in the UK in regards to the airline industry are becoming a factor that most airlines face. The London County Judge, for instance, impacted a fine of $ 10671 to Easy jet for a breach of contract regarding compensation claim from a passenger who was denied refund after denial of flight. From that case, the passengers have won the refund of cost after a choice of not flying and should be adhered by all the UK airlines and in particular IAG and Easy Jet and other airlines. (Minkova, V. 2011).

Company Analysis

Easy Jet Nusiness Profile

Easy jet is among the British airline carriers operating on a lost cost model. It is based at London Luton airport. Easy Jet carries a large number of passengers and is therefore known to be the largest airline in the United Kingdom. It carries not less than 73 million passengers, and that makes it the second largest carrier after its competitor Ryanair (Plunkett, J. W. 2009).

Market Growth

The easy jet is putting into consideration the power of the new entrance as it competes with its competitors. It aggressively competes on routes, price, and service in an attempt to overcome the rising competition in the industry. Easy jet also has sought to introduce the customer retention scheme that will improve their direct marking. It has come up with an accurate and realistic assessment of the market niche that the industries are targeting. (Sitkin, A., & Bowen, N. 2013).

Market Challenges

Easy jet is faced with some challenges as it ventures to different markets. A terrorist attack is among the main challenges that have appeared to face the industry. There is also whether challenges that have always resulted in the cancellation of flights. Such cancellation interferes with the overall revenues. Despite that Easy Jet has sought ways of overcoming the competitors, it is still facing stiff competition from Ryanair.

International Airline Group Business profile

International Airline Group is among the largest airline in the world. It has 546 aircraft that fly to 279 destinations. It carries about 105 million passengers year. Based on their revenue, the airline is the sixth largest in the world and third largest in Europe.

Market Growth

International Airline Group (IAG) is receiving a constant market growth. Their revenues reveal constant increment. It continues to aim at a premium development and has managed to grow its share of revenues. The shareholders of IAG received substantial dividends as a result of the increased profit each year. The industry is aiming at the improvement of technical issues that relate to the operation.

Market Challenges

Despite the development in the industry, IAG is undergoing challenges as it ventures into different markets. Just like an Easy Jet, the industry is faced with such challenges including, whether changes, terrorist attack in parts of their destinations and the arising competition. IAG is, therefore, seeking to get proper ways of addressing such market challenges.

References

Belobaba, P., Odoni, A. R., & Barnhart, C. (2016). The global airline industry. Chichester, West Sussex, United Kingdom: Wiley.

Boer, E. R. (2017). Strategy in airline loyalty: Frequent flyer programs. Cham, Switzerland: Palgrave Macmillan.

Conrady, R., Buck, M., Viehl, P., & Tittel, K. (2011). Trends and issues in global tourism 2011. Heidelberg: Springer.

Great Britain., & Great Britain. (2012). Flight time limitations: First report of session 2012-13: report, together with formal minutes, oral and written evidence. London: Stationery Office.

International Conference on Information and Communication Technologies in Tourism, Cantoni, L., & Xiang, Z. (2013). Information and communication technologies in tourism 2013: Proceedings of the International Conference in Innsbruck, Austria, January 22-25, 2013. Berlin: Springer.

Minkova, V. (2011). Low-Cost Carriers - Business Model, Impacts of its Expansion and Challenges: Analysis of the European Low-Cost Carriers. Munich: GRIN Verlag GmbH.

Peoples, J. (2014). The economics of international airline transport. Bingley, U.K: Emerald.

Plunkett, J. W. (2009). Plunkett's transportation, supply chain & logistics industry almanac 2009: The only comprehensive guide to the business of transportation, supply chain, and logistics management. Houston, TX: Plunkett Research Ltd.

Sitkin, A., & Bowen, N. (2013). International business: Challenges and choices.