Air Asia Essay

1877 words - 8 pages

The reason I chose to research about AirAsia is because; Air Asia is a very outstanding company in airline industry and among their competitors in the low-cost career (LCC). I have learned from one of my university course called Airline Business Management that the airline industry is intensively competitive. To survive in this industry the airline business must be strong and has well strategy to overcome every high challenge in the industry. AirAsia has becoming more and more successful. Therefore, I would like to learn more about this airline; learn about their perspectives, tactics, and strategy to improve my knowledge on airline business.

Background and History
Air Asia is a low-cost, short-haul, airline business operating flights within Asian region with the fleet size of 101. The company first headquarter is located in Kuala Lumpur as their main hub, Malaysia (AirAsia Corporate Website, 2013). Air Asia was owned by DRB-Hicom, a governmental own automotive corporation, and was heavily indebted until the company was sold to Tony Fernandes, the company’s present director. Fernandes turned the company around in 2001, and operated the business as a low-cost airline with new regional routes originated from Kuala Lumpur hub to Bangkok. The later developed new routes in the following years were included Singapore, Indonesia, China, Philippines, Macau, Vietnam, Japan, Laos, Maldives, Brunei, Mynmar, Nepal, South Korea, Sri Lanka, Taiwan, and Cambodia. AirAsia now has joint ventures in; Thailand, India, Japan, Indonesia, and Philippines (Wikipedia, 2013).

Also, the company has established AirAsia X in 2007 focusing in a low-cost, long-haul segment. X which stands for; X-citing low fares, X-emplary levels of safety and care, and X-traordinary in-flight service and entertainment for their customers. The first flight was commenced from Kuala Lumpur to Australia (Wikipedia, 2013). AirAsia X serving 14 destinations including; Sydney, Melbourne, Perth, and Gold Coast cities in Australia; Jeddah city in the Middle East; and Tokyo, Osaka, Seoul, Taipei, Beijing, Hangzhou, Chengdu, Shanghai, and Kathmandu cities in Asia (Airasia X Bhd (AAX:Kuala Lumpur, 2013).

Marketing and Image
AirAsia came with a slogan ‘Now Everyone Can Fly’ in which it brands the airline priority of making the flights really enjoyable and affordable for their customers. Hence, the company position themselves in the market as a low-cost airline. To better the understanding of low-cost airline, it is referred as an airline that provides simple products without any non-essential service such like in-flight meals, extra pillow, and priority boarding (Reynolds-Feighan, 2001). However, to sell tickets at such low rates, it means that the operating costs must be minimized; shorten procedures like turnaround time (on ground waiting) with simple-boarding process. As well as lower wages for employees which the airline will require low and fresh crews or staffs. In a strategic...

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