Presented By: Kelly Bossolt Marta Kovorotna Sarah Smith
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Transcript of Presented By: Kelly Bossolt Marta Kovorotna Sarah Smith
Presented By: Kelly BossoltMarta KovorotnaSarah Smith
Executive Summary
Financial Analysis External Analysis
Entry & Rivals Industry Customers Substitutes, Complements, Acquisitions
Internal Analysis Recommendations
External Analysis: Entry
Deregulation Act Enabled new entrants
150 went bankrupt 8/11 developed merging agreements
Created competition Creating lower prices
Creating more travelers
Rivals Delta, United, American
80% Domestic Market, 67% Trans-Atlantic Market
External Analysis: Industry
2nd Tier Providers Took on the abandoned
and ignored markets
Hub – and – Spoke 80% costs were fixed Control Mechanism
Sublease for premium (18% higher for Southwest)
Efficient
External Analysis: Customers
“The ones that could afford to fly, and the ones that couldn’t”
Two types of travelers Convenience, time oriented Price sensitive, leisure
Two tiered Pricing structure to accommodate both
External Analysis: Substitutes & Complements & Acquisition
Substitutes Train, Bus, Boat, Car, Horse
Complements Meals, Comfortable seating,
Television
Imitator JetBlue
Southwest acquired and integrated into its own
Diversified locations Slightly more sophisticated
Leather Seats, Televisions
Recommendations
Move to international markets Not necessarily Trans-Atlantic, but integrate new
markets