Risk management in Kingfisher Airlines PART 1 Problem statement and background Kingfisher Airlines (KFA) was founded by Vijay Malaya and he is the chairman of United Breweries group (UB group) in the year 2003. Its first airplane was launched from Mumbai to Delhi in 9th may 2005. It started as a premium business class airline company. The airlines have a tag line “Fly the good times”. At the launch of airline, Vijay Malaya said “we are committed to achieving our ambition of making Kingfisher Airlines, India’s largest private airline both in capacity and market share. The airline ushered in a new era of luxury in India’s domestic aviation sector and its brand new aircraft with stylish red interiors, and smartly dressed crew and ground staff. Kingfisher was the first Indian airline to have in-flight entertainment (IFE) systems”. (Malaya, 2005). Kingfisher airlines are one of the seven airlines which were awarded the rating of five stars by skytrax. It operates 400 flights daily including the regional and international services. In 2009 it gave the highest market share in Indian airlines industries, carrying more than 1 million passengers. The main mistake was lack of understanding of customer requirements and luxurious facilities in airlines. Organizations focus on reducing costs and usually just CEO’S and top level managers prefer business class travel. Rest of the staff mostly travels by economy class. Moreover, buying most expensive business class tickets doesn’t go down well, when seniors aim to project the image of walking the talk. Secondly, the company is facing financial crisis since Mid-2008. After merging with Air Deccan in 2007, it is a low-cost airlines, provides minimum frills to customers at reasonable rates. Th... ... middle of paper ... ...etrieved March 26, 2014, from http://www.moneycontrol.com/financials/kingfisherairlines/balance-sheet/KA02 The UB Group. (n.d.). In Aviation. Retrieved March 26, 2014, from http://theubgroup.com/business_aviation.aspx KINGFISHER AIRLINES LIMITED ANNUAL REPORT 2010-2011. (2011, August 25). In ANNUAL REPORT. Retrieved March 26, 2014, from http://theubgroup.com/PDF/Fly%20Kingfisher/annual%20report/Kingfisher_Annual_Report_2010_2011.pdf Prabhu Desai, A. (n.d.). In Indian Aviation statistics: Indigo, Kingfisher rule!. Retrieved March 26, 2014, from http://trak.in/tags/business/2011/02/22/indian-aviation-industry-stats-indigo-kingfisher/ Jaspal, S. (2012, March 14). Risk Management Failures in Kingfisher Airlines. In Risk Board. Retrieved March 26, 2014, from http://soniajaspal.wordpress.com/2012/03/14/risk-management-failures-in-kingfisher-airlines/
The objective of this research report is to provide a thorough analysis of Alaska Airlines. In order to do this we chose to compare a similar company against them. The company in comparison is Spirit Airlines. Both companies compete in the same type of business through airline transportation. Many of their services include; security, safety, transportation of passengers as well as luggage, ensuring vehicle safety while in transit, concierge services, providing entertainment aboard plane, checking weather conditions prior to flight, and much more. All of the data gathered for this report was obtained from the company’s 10-k filings with the SEC.
Lack of proper risk management process: NASA was using a simple risk classification system and the methods used were only qualitative. There was a lack of proper technical and quantitative risk management methods that could have helped them identify the risks and eliminate them.
The Airline Industry is a fascinating market. It has been one of the few industries to reach astounding milestones. For example, over 200 airlines have gone out of business since deregulation occurred in 1978. Currently, more than 50% of the airlines in the industry are operating under Chapter 11 regulations. Since 9/11, four of the six large carriers have filed for and are currently under bankruptcy court protection. Since 9/11 the industry has lost over $30 billion dollars, and this loss continues to increase. Despite the fact that the airline industry is in a state of despair, JetBlue has become the golden example, a glimpse of what the industry could be.
According to the International Air Transport Association, 2001 was only the second year in the history of civil aviation in which international traffic declined. Overall, it is believed that the IATA membership of airlines collectively lost more than US$12 billion during this time (Dixon, 2002).
As an airline corporation serving most of the United States and several international locations, JetBlue burst into the scene and grabbed significant market share. However, with growing reputation came stiff competition from major airlines as the rival brands felt a significant threat. It forced JetBlue to re-think a lot of its business model, from fuel-economy of its carriers to marketing strategy. Nonetheless, a decade-and-a-half since its debut, it holds strong in the highly competitive and fragmented air travel industry, particularly impressive with its customer satisfaction rating.
Airline and travel industry profitability has been strapped by a series of events starting with a recession in business travel after the dotcom bust, followed by 9/11, the SARS epidemic, the Iraq wars, rising aviation turbine fuel prices, and the challenge from low-cost carriers. (Narayan Pandit, 2005) The fallout from rising fuel prices has been so extreme that any efficiency gains that airlines attempted to make could not make up for structural problems where labor costs remained high and low cost competition had continued to drive down yields or average fares at leading hub airports. In the last decade, US airlines alone had a yearly average of net losses of $9.1 billion (Coombs, 2011).
Several large scale, interrelated conditions have affected the airline industry over the past several years in such a manner that every carrier has had to respond in order to remain viable and competitive.
Air India airline is one of the biggest airline in the India. It was established by the famous company TATA and since its incorporation. It has grown very well and has spread all over the world in the different destinations. It has become the reputable brand in the airline industry with having the operations over 152 destinations. It has link up connection in the 35 countries and it has currently having 137 fleets. This company becomes the public limited company in the 1946. The company has international and the local route and its performance is increasing day by day with the pace of the good growth as compare to the other airlines in the industries in the area and the channels in which this airline is working.
Flight fee is one of the biggest nightmares of the passenger. In this regard, such an initiative is a win-win situation for the Asiana airlines. The establishment of extensive cabin retrofits is also a great improvement to the customer service delivery. The airline also boosts customer experience in a bid to achieve the airline’s sustainability through the provision of lie-flat seats. The seats boost comfort for the passengers aboard; hence, reduction of exhaustion. According to Asian Development Bank (2009), the airline provides the passengers with a sizeable monitor, especially for the business class passengers. The practical productivity of team relies on upon its hypothetical planning, information of an aeronautical building, and tenets of its operation, including exceptional circumstances, and propensities for utilization of this learning, furthermore on order and determination of pilot-in-charge of aircraft and group individuals. The administration productivity air movement, the associations of flight action and a wide range of upkeep of aircraft in the greatest degree is controlled by the proficiency of the action association in the modern undertakings, cognizance of initiators, and the moral obligation of leaders of all positions for action concerning security control of
Today’s air traveler is like any other consumer looking for value for money. Disposable incomes are on the rise and the consumer is willing to spend more for quality and brands. Air travel is no more about transporting passengers. It is more about the flying experience. People like travelling in planes. ‘Kingfisher airlines’ has a very good social image. Being a five star airlines, customers want to travel with Kingfisher. Also, the brand charges a premium price that is why only upper Socio Economic Class people prefer Kingfisher airlines. The lifestyle of the people is improving. Luxury is becoming necessary. They are ready to pay more for luxury services. Kingfisher has a strong advantage here. So, we can conclude that sociological conditions are favouring Kingfisher airlines.
In India, one can never over-look the political factors which influence each and every industry existing in the country. Like it or not, the political interference has to be present everywhere. Given below are a few of the political factors with respect to the airline industry:
They have been operating as passenger and freight carriers, albeit under different corporate identities, since the beginning of commercial aviation in the 1930’s. They have weathered the cycles encountered by airlines and the aviation industry in general – political, economic, environmental and social; as well embracing the technological progress afforded the industry.
AirAsia Berhad (AirAsia) is a leading Low-Cost Carrier in the Association of Southeast Asian Nations (ASEAN) region. AirAsia focuses on providing high-frequency services on short-haul domestic and international routes. The main goal of this paper is to analyse the business strategy of AirAsia as a low-cost airline. This paper aims to apply the management process of strategy and analyse the three levels of strategy by which AirAsia is able to maintain its reputation as the top Low-Cost Carrier (LCC) in Asia. This paper will then show how innovation is a key aspect in AirAsia’s strategy, and will finally consider the external environment framework in which AirAsia is succeeding.
Several weaknesses in airline operations were identified as the causes of the RM1.3 billion loss. These included esclating fuel prices, increased maintenance and repair costs, staff costs, low yield per available seat kilometer ("ASK") via poor yield management and an inefficient route network.
Facts & figures - Air Transport Action Group (ATAG. (2012, March). Retrieved from ATAG.org: http://www.atag.org/facts-and-figures.html