A Report on Kingfisher Airlines Essay

Overview of Airlines attention in IndiaThe airwave fabrication in India is one of those sectors that saw a constant pace of growth among the other industries in the world over the past many years. The open sky policy of the government has helped a standoff of overseas players entering the aviation commercialize in India. From indeed, it has only been growing in terms of players and the number of aircrafts. At present, private air passages account for around 75% portion of the domestic aviation market. The 9th largest aviation market in the world is India. Taking the help of the statistics from the Ministry of obliging Aviation, approximately 29.8 million passengers traveled to/from India in 2008, video display a surge of 30% from 2007. The prediction say that transnational passengers will touch 50 million by 2015. More opportunities in the aviation industry in India are alike(p)ly to derive way for about 69 foreign air lanes from 49 countries.Growth of aviation indust ry in IndiaThe Indian Civil Aviation market grew at a CAGR of 18%, being valued round US$ 5.6 trillion in 2008. Further statistics revealed that the air traffic in August 2009 was a double digit figure. The domestic airliners flew 3.67 million passengers in August 2009, as a peest 2.92 million in the corresponding period of 2007, up by 26%. The Centre for Asia Pacific Aviation (CAPA) has estimated that the domestic traffic will go up by 25% to 30% till 2010 along with a surge in the international traffic by 15%. There would be more than 100 million passengers by 2010. Then again by 2020, Indian airports will in all probability handle over 100 million passengers every year. The investment plans to the tune of US$ 9 billion has been made by the Aviation Ministry for modernizing the existing airports by 2010.In terms of domestic passengers volume, US have always been the leader with fol piteousers in the confederacy like China, Japan and India. The number of domestic flights went up b y 69% from 2005 to 2008, with the domestic aviation sector growing at 9-10%.VisionThe Kingfisher Airlines family will administrationatically deliver a safe, value-based and enjoyable travel experience to all our guests.MissionKingfisher Airlines will have Fly the Good Times approach and this will theorise in the experience we will offer to passengersIntroductionKingfisher Airlines Limited is an airline group based in India Its head office is in Andheri (East), Mumbai and Registered Office in UB City, Bangalore. Kingfisher Airlines, through its parent company United Breweries Group, has a 50% stake in low-cost carrier Kingfisher Red. The airline has been facing financial issues for many years. Until declination 2011, Kingfisher Airlines had the second largest share in Indias domestic air travel market. However referable to a severe financial crisis faced by the airline at the beginning of 2012, it has the lowest market share since April 2012.The airline has temporarily shut down its operations when on October 20, 2012 the DGCA suspended its flying license. This suspension had been due to failure to give an effective response to the show-cause notice issued by DGCA. However, The airline had locked out its employees for several days before this suspension. On 25 October 2012, the employees agreed to clear to work.Strategic ManagementStrategic management is an ongoing process that assesses the business and the industries in which the company is involved assesses its competitors and sets goals and strategies to pit all existing and potential competitors and then reassesses each strategy annually or quarterly i.e. regularly to determine how it has been implemented and whether it has succeeded or needs replacement by a new strategy to meet changed circumstances, new technology, new competitors, a new economic surround., or a new social, financial, or political environment. (Lamb, 1984) The systematic analysis of the factors associated with customers and compet itors(the external environment) and the organization itself(the midland environment) to provide the basis for maintaining optimum management practices. The objective of strategic management is to achieve better alignment of corporate policies and strategic priorities.SociologicalTodays 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 calibre and brands. Air travel is no more about canaliseing passengers. It is more about the flying experience. People like travelling in planes. Kingfisher airlines has a very sober 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 frugal Class people prefer Kingfisher airlines. The lifestyle of the people is improving. Luxury is becoming necessary. They are ready to pay more for luxury processs. Kingfisher has a strong emolument here. So, we can conclude that sociological conditions are favouring Kingfisher airlines.TechnologicalPeople are becoming more and more tech-savvy. Kingfisher does provide a TV at the covering of the seat. That means every commuter has his own TV. Apart from that, Kingfisher also has facilities such as e-booking. Now, commuters can up to now book the tickets by mobiles. So, it can be stated that Kingfishers image and sales are driven by technology too.EconomicFigures indicate that purchasing power of Indians is increasing. People look for more options now, as yet luxury goods. Bank Credit is easily available in example of travelling. Economic slowdown is one of the major factor which is affecting the sales of aviation industry. In INDIA there is a mixed economy so private organization easily perform their tasks within any given economic system of course, organization are influenced by a variety of economic features over which they have little independent control, such as inflation, interest rat es and break Another important input to the enterprise is the nature of government fiscal and policies.EcologicalOne important factor is that how natural factor affects the aviation industry as whole. The most important factor is the stability of the abide. The timings of the flight are highly affected by shifts in weather. Also, it can be noticed that a highly unstable weather is directly proportional to the added costs to the company. For example, if there is a delay in the flight, the company has to provide facility for accommodations of commuters. In India, weather is quite stable in most of the time during the year. Thus, aviation is a profitable business in India, if we consider ecological factor.PoliticalThe political environment is stable. In India, government changes after 5 years. Also, it is a democratic country. Kingfisher has an added advantage over here that the owner of Kingfisher, Vijay Mallya has very good political network. That means even political environment f avours Kingfisher airlines.LegalAviation fuel prices in India are regulated by government. So the competition for price becomes quite still. All the companies in the industry have to pay the same amount for fuel. Now companies can increase or decrease the prices depending on the services they provide. A premium service provider, of course, would charge the prices for its services.EthicalIndians are highly ethical people. They always make a trade off between what is right and what is wrong before they make any purchase decision. For example, if a company says that 50% of their contributions will go for the charity, then Indians are more likely to buy products or services of that company. Kingfisher airline gives value for the money. It is Indias only five star airline service provider. Hence, considered ethical.Porters 5 Forces for Kingfisher AirlinesThreats from competitorsThe level of threat from the domestic competitors is very high. Competitors like Jet Airways, Indian are some o f the old well established players in the market which prove to be strong competitors for the emerging Kingfisher AirlinesThreats from new entrantsThe level of threat from new entrants is quite low such as Virgin Atlantic, Qantas. The major players in the Indian aviation industry form an obstacle to foreign airlines and moreover Indian flyers prefer to have an Indian experience on the flight.Threats of substitutesThe introduction of high speed trains, high tech buses and other means of transport has given more options to people to travel. Aviation in India is booming and with the entry of several new players in the market competition has stiffened. In such a scenario it is imperative for any airline to build its brand and have a focused marketing strategy in placeBargaining power of suppliersThe bargain power of suppliers is medium. For example, Airbus and Boeing are the major aircraft manufacturers and there arent many aircraft manufacturers other than these two, this confines Kin gfishers options therefore the bargaining power of Airbus or Boeing increases. In case of other suppliers such as caters the bargaining power of the suppliers is low therefore Kingfisher has many other options of caters to contract to.Bargaining power of customersThe bargaining power of the customers is low since kingfisher is designed to meet the total comfort and value for money therefore customers arent reluctant to pay a little more sum to gain this experience.Competition AnalysisKingfishers only strong obstacle proves to be Jet Airways, since Jet has control on both ends of the market and secondly it has penetrated into the international market as well. Benchmarking against Jet Airways, Kingfisher Airlines has acquired Air Deccan which was one of the most profitable low cost airlines, hence kingfisher too has entered in the lower end of the market but bearing in mind that they havent changed the name Deccan to Kingfisher Airlines so that the brand doesnt lower. Kingfisher is st ill testing the lower end of the market with Deccan. Kingfisher is also going to start non-stop flights to US so as to foray into the international market.