Part A

The objective of this analysis is to determine the preferred airline services. The Low-Cost Carriers (LCC) entail airline services with low fares and less comfort. The airlinesrecoup the lost income through extra charges on food, and seat allocation among others. In the book Low-Cost Carriers: Emergence, Expansion and Evolution,Ison(22), highlights the strengths and weaknesses of LCC. One of the advantages of the low-cost carrier is the acceleration of the traffic growth of the airline. Investing in a higher number of seats and airplanes that are efficient saves on the operating costs of the company. The weaknesses of LCC includepoor brand perception and the seasonality of earnings. The users of LCC expect high levels of punctuality and safe air travel at a lower cost, which might not always be the case. Moreover, the aspect of seasonality means that there are high earnings at specific periods and low revenues during other times of the year.  There has been a rapid rise in LCC as a popular alternative to mainstream airlines. Over the past decade, there has been a significant shift in the low-cost carrier’s market segment(Ison 22). There has also been an expansion of the LCC and change in the business model. The commercial model for LCC focuses on operational practices that lower an air company’s operational costs. Besides, LCCs fly short-haul routes and return to base in a bid to avoid hangarage and other associated costs.

The full-service carrier (FSC), on the other hand, offers its passengers checked baggage, beverages, in-flight entertainment,other comforts such as pillows and blankets, and meals in the all-inclusive ticket.In most cases, the FSC has more legroom and seats with more recline. One of the strengths of the FSC is the all-inclusive ticket, which,in most cases,is the only cost that the client will incur during the flight. The FSC also allows one to buy tickets to destinations that are directly connected to his or her departure destination. One significant advantage of full-service carriers is the convenience of the takeoff time. There is a chance for passengers to choose the class they want to use according to their preference and affordability. Among the types of tickets, available include the economy class, business class, premium economy, and first class(Cento 29). One of the weaknesses of FSC is the high prices of the tickets, which limit the number of passengers as most people tend to opt for low-cost carriers. Another weakpoint is the rise in the number of competitors who offer quality services at low rates thus causing the FSC airlines to revise their prices drastically.

It is important to note that the price is not the only factor that separates LCC and FSC. There are other services such as connecting flights, different airline policies, and comfort.The full-service Carrier offers all the mentioned services in one package (Xu andDingjun 32). The LCC, however, provides essential services with fewer comforts such that the clients may incur extra costs during the flight.

Part B

The objective of the analysis is to establish the market positioning of Airbus and Boeing.

There are only two firms in the airline manufacturing industry; Boeing and Airbus. Each of the firms has strategies in place for positioning in the market place through the use of flagship products.One of the strengths of Airbus is the innovation in technology and design. The firm has used modern technology in manufacturing and assembly of the A 350. Another advantage of the Airbus is that the planes are eco-efficient. The firm is one of the pioneers in eco-efficient sustainable aviation(Miller et al. 15). The Airbus was able to produce eco-friendly products through the launch of the blue five, which is an initiative that ensures waste reduction, CO² reduction, energy saving, and VOC reduction.

One of the weaknesses of the Airbus is that the demand for the product is low yet the company believes that the planes are in high demand. However, the Airbus has backlogs since the manufacturer deliversa smaller number of aircrafts as compared to the number of orders placed. Another weakness of the Airbus is operational inefficiency whereby delayed launches are common. Besides, the production cost of Airbus is very high thus minimizing the profit margins of the firm. In the year 2001, the Airbus was formed through the integration of a consortium of European Aerospace firms to make a single company(Shishido 27). The move was made to place the airline manufacturer in a better position to compete against the American Manufacturers. Over time the Airbus consortium has developed a single-aisle A320 and a twin Aisle A340.

The Boeing, on the other hand, has grown over the years and controls a broader market share in the commercial aircraft sector. The manufacturer has come up with a wide range of aircrafts including theSingle Aisle737, medium and range 767, long-range 777 as well as the Jumbo Jet. The firm is renowned for manufacturing weapon and attack aircrafts as well as the sate lights(Gould 14). Boeing’s extensive portfolioof products gives the company a competitive advantage over the Airbus. However, one of the weaknesses of Boeing is the severe technological constraints in the aircraft producer’s new designs.

Boeing has agreat competitive edgeover the Airbus. However, the corporation’s lack of investment in technological advancement and its poor designs offer the Airbus a chance to gain a foothold in the airline industry. Nonetheless, Boeing produces a higher number of airplanes compared to its competitor(Gould 17). Moreover, the company’s continuous growth indicates an increase in its valuation over time while the full range of aircrafts meets the needs of various users ranging from commercial, private, military,and space explorers.

Part C

Global trends have reshaped the GCC travel in the airline market. The need for digital technological innovation has weakened the relationship between airlines and their customers. Therefore, the GCC airlines have transformed their distribution business model as well as how they attract their customers. With the growth of internet penetration in the Middle East, there is an increase in mobile use thus leading to easier access and interaction with potential clients (Desai 12). Growth in the consumer base enables GCC airlines to extract more value from their services and products. It is worth noting that social media has also grown into a useful platform for advertising.

Social online networks allow companies to share first-hand experiences from satisfied customers. Moreover, the platform can also be used by a corporation to get feedback from their customers, which helps the firms in improving their services and ensuring customer satisfaction.As a result, the airlines have designed loyalty programs that allow direct engagement with the customers and let them earn rewards such as cash, upgrades and seat redemption(Desai 26). The organizational structure of the GCC airlines allows a functional collaboration in their operations, which are geared towards understanding the clients’ needs and increasing customer retention. Therefore, airline companies are required to stay updated with the current trends and tailor their services to the broader demographic to retain clients and gain new ones.

The Asian and European carriers have adopted market strategies that would attract more customers and maximize their profits. The airlines in the two neighboring continents have ventured into the low fare approach through the Dunning eclectic paradigm, which involves navigation and managing flights with low operational costs(Mills 69). In the past, the European airlines had focused on the tourism and charter markets. With the change in the market trends, air travel firms also embraced the low-cost market environment. In 1985, firms such as the Air Berlin were founded to serve the tourism sector. Easyjet and Ryanair were later introduced in 2000(Asia 68). Over the years, the carriers have undergone a series of relaunching and rebranding to maintain a competitive advantage in the aviation industry. The European Union has an unregulated aviation market and economic area in which there is no foreign ownership restriction or limitation in traffic rights.

The Asia Pacific aviation market is more regulated with traffic rights and foreign ownership. The Asian airlines were launched in the 1960s and have also gone through significant rebranding. The carriers in Asia have also embraced the low fare flights. The Asian airline industry relies on exports as an internationalization strategy(Starkie 22). Other approaches of market entry welcomed by the Asia airlines are contractual alliances, national subsidiaries,andprivate bases.

The aviation industry is part of the service sector that competes to offer the best experience to its users in a bid to gain a competitive advantage. The Asian carriers have understood the market and tailored their services in a way to attract more customers as well as retain them. The move has allowed loyalty programs that offer several packages to their clients such as gifts and earning points that are redeemable(Bernardo 13). Asian airlines have alsoincorporated both traditional and formal advertising campaigns. Moreover, as part of CSR (Corporate Social Responsibility), the air travel corporationssponsor sporting events and food festivals and the popular events boost the companies’ image and act as marketing tools.

Work Cited

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