...Jet Blue Airways JetBlue Airways took to the skies in 2000 under a novel concept: bringing humanity back to air travel. Based at New York's Kennedy International Airport, JetBlue, a non-union airline, distinguished itself from other low-fare carriers such as Southwest Airlines by offering seat-back entertainment systems with live television, comfortable seats and blue corn chips. During the last six years, when traditional airlines were piling up more than $40 billion in losses, JetBlue grew to $1.7 billion in annual revenue and became increasingly popular with travelers. But now that fuel prices have pushed up expenses for all airlines, and older carriers have sharply cut their own labor costs, the advantage JetBlue enjoyed as a start-up is greatly reduced. JetBlue — too new to have built up excessive costs that can now be trimmed, is trying mightily to raise fares in a bid to restore profits after surging fuel prices caused it to lose $42.4 million during the fourth quarter of 2009. The trends in the U.S. airline industry and how these trends might impact a company’s strategy The airline industry is susceptible to upturns and downturns with the trends in the economy. A growing economy and booming business mean greater demand for air travel, and a slow-down in the economy means reduced demand, consequent unutilized capacity and intensified competition. The availability of venture capital and other capital sources have an impact on the number of new entrants...
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...Case # 3 Jet Blue Airways Discuss the trends in the U.S. airline industry and how these trends might impact a company’s strategy Overall the US airline industry is a cut-throat business which is extremely competitive. The cliché ‘it’s a dog eat dog world’ applies perfectly here. Over the past few years the situation grew even worse due to the recession, increased unemployment, the weakened dollar exchange, and difficulty predicting how OPEC will behave month to month. The fluctuation in the oil market has a direct effect on ticket prices bought in bulk or reserved six to nine months in advance. Airline pay close attention to the oil Futures Market to make sure their purchases of fuel is hedged. Airline companies are divided into a few categories. Jet Blue is in the discount airline category, where lowering the fixed cost is an important factor. For a discount airline to offer cheaper price, services must be cut as well as the number of airports serviced. Only destinations with high volume are able to be serviced, thus a traveler may be forced to have multiple connections to reach their destination. Airplanes must be leased instead of bought to reduce the upfront cost. In-flight meals and unlimited beverages are curtailed or completely removed. The absence of complimentary cases of beer or soda cans adds to savings on gasoline as well as price per can which is factored into lowering the ticket price. Full service airlines such as Singapore and Lufthansa, cater to a...
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...CRAFTING AND EXECUTING STRATEGY Professor Charles Woods Bus599 May Digby October 15, 2011 Discuss the trends in the U.S. airline industry and how these trends might impact a company’s strategy. The airline industry exists in an extremely competitive market; a market which has become even more competitive; given the current state of our economy. Airlines were faced with rising fuel costs; and decline in travel after the 9/11 attacks. This forced the airline industry to initiate cost cutting measures to be able to continue to operate. This was good news for discount airlines such as JetBlue Airways. JetBlue saw an increase in passengers; resulting in an increase in revenue. JetBlue’s strategy is to provide the passenger the ultimate air travel experience at an reasonable price. Jet Blue was able to become a leader in the airline industry by distinguishing itself from other low fare carriers by offering amenities such as; live television, leather seats and gourmet snacks. Passengers confidence in air travel was damaged greatly after the 9/11 terrorist attacks. JetBlue was one of the few airlines that made a profit following the 9/11 attacks. (Wikipedia) Airline industry has been deeply affected by the recession also. Airlines have been forced to cutback on flights and reschedule existing routes and have been forced to charge for extra baggage. Consumers are constantly searching for ways to save money and the airline industry had tried to adjust to the increasing...
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...Analysis of Jet Blue Airways BUS 599 October 19, 2010 Analysis of Jet Blue Airways JetBlue Airways Corporation is an American low cost airline. Since 2001, the U.S. airline industry has faced an unprecedented set of challenges. Following the terrorist attacks of September 11, 2001, the airline industry reported tremendous losses and several of the largest U.S. airlines filed for Chapter 13 bankruptcy protection (Flouris, Walker, 2005). As a result, the airline industry has been more creative in their strategic marketing plans to remain financially viable. Many airlines have led the way with innovative ideas to retain, gain, and build their customer base. JetBlue Airlines has followed the path of most airlines but as one of the leading low cost air carriers, Jet Blue’s business strategy differentiates from most airlines. Trends in the U.S. Airline Industry and Impact on Strategy Trends in today’s U.S. airlines industry continue to show a drastic departure from business practices of previous years. With the constant increases in the price of conducting business, airlines are searching for ways to make or increase profit. Passengers are often charged for many amenities once offered free of charge by the airlines. Due to one of the most severe economic recessions in recent years, passengers should expect these trends in the airline industry to continue. However, prospects for the airline industry look a lot brighter as the industry continues to persevere and move...
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...Strategic Planning: Jet Blue Airways Gregory James Professor John Mitchell BUS 599 Strategic Management April 24, 2011 Abstract This report has been produced to determine if the strategic planning in which new of Jet Blue Airways CEO David Barger has created, will help to ensure the company long term success. Addressed in this report will be the following topics: (1) What are the trends in the U.S. airline industry? How might these trends impact a company’s strategy? , (2) What is Jet Blue’s strategic intent? , (3) What are Jet Blue’s financial objectives? Has the company has been successful in achieving their objective? , (4) What are Jet Blue’s strategic elements of cost, organizational culture, and human resource practices? Does each of these elements provide the organization with a competitive advantage? , and (5) What are Jet Blue’s strategies for 2008 and beyond? Will Jet Blue be successful implementing these strategies or not? Strategic Planning: Jet Blue Airways What are the trends in the U.S. airline industry? How might these trends impact a company’s strategy? With the constant changes in the country’s economy, airlines are having more difficulties reaching a competitive advantage. The constant raise in fuel and oil cost to fuel airplanes has caused airlines to come up with a plan to maintain these cost. In addition, the airlines also focus on increasing profit return to shareholders and company executives. To achieve this goals airlines have started...
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...Equity Research June 16, 2016 BSE Sensex: 26726 INDIA Aviation Flying high amid good times Reason for Report: Sector thematic and initiating coverage InterGlobe Aviation (Rs1,011 – BUY) Target price Rs1,268 SpiceJet (Rs66 – HOLD) Target price Rs64 Jet Airways (Rs561 – ADD) Target price Rs621 Research Analysts: Ansuman Deb ansuman.deb@icicisecurities.com +91 22 6637 7312 India’s aviation sector is set to undergo a strong growth period, which should benefit all the incumbent players, particularly on a benign crude price outlook. Our supply-demand model for domestic air traffic implies 14% growth in passengers as evidenced from firm aircraft orders and latest delivery schedules. With yield management becoming the singular strategy lever for Indian Low-Cost Carriers (LCCs), cost structures assume high importance and structural asymmetries will decide the competitive edge for the airlines. However, much of these asymmetries in cost structure are inherited from the fleet strategy adopted by various airlines, hence normally have a long-lasting impact on their balance sheets. High operating leverage proves fatal in a cyclical downturn where balance sheet strength is vital. At the comfort of hindsight, bulk orders have benefitted IndiGo with valuable incentives, which have given it the structural advantage of lower rentals, while single fleet focus and strong balance sheet have lent IndiGo asymmetrical advantages on maintenance costs, redelivery expenses and supplementary rentals...
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...aviation estimates that by the year 2010, 25 to 40 million international passengers will fly through Indian airports, while around 45 to 70 million passengers will be flying in the domestic front. At present, the market leader, “Jet airways” along with “Air sahara” controls 46% of the Market share, while “Indian”controls 25%. “Air Deccan controls 13% and Spice jet 6% with Kingfisher having 8% share. Indian Airlines commenced operations in the year 1953, with an initial capital of Rs.3.25 Crores, under the Air Corporation Act. It was formed by nationalizing and merging a group of eight airlines. The Airline was primarily interested with the task of serving the domestic sector and neighbouring countries. Over the years, combined with Air India, it had a near total monopoly over the Indian Skies. On December 7, 2005, Indian Airlines went in for a name Change and has dropped the word “Airlines”. It is now known as “Indian” and has also come out with a new logo. World over, airlines have gone in for a new logo after a decade or so while Indian Airlines has opted to do so after nearly 40 Years. The logo is contemporary graphic representation inspired by the wheel of the sun temple at Konark. The logo is a partly visible blue wheel on the orange tail and represents timeless motion, convergance and...
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...making……………………………………8 2.2 Problem Solving Process in Jet Airways………………………………………………..9 Chapter: 3 3.1 Introduction of the Tools Used by the Jet Airways……………………………………11 3.2 Solution Taken by the company ………………………………………………………..12 3.3 Alternative solution………………………………………………………………………12 3.4 Impact of success ………………………………………………………………………...13 Chapter: 4 4.1 SWOT Analysis of the Approaches Used by the Company…………………………..13 4.2 Comparing the Company’s Adopted model with other model………………………..14 4.3 Finding from the Comparison Results………………………………………………….15 4.4 Recommendations………………………………………………………………………...16 Chapter: 5 5.1 Introduction of strategy…………………………………………………………………..16 5.2 Strategies adopted to illustrate your suggestions are appropriate…………………….16 5.3 Implementation of your recommendation model against Organizational Problem or Issues…………………………………………………………………………………………….17 Conclusions……………………………………………………………………………………...18 PROBLEM SOLVING AND DECISION MAKING IN JET AIRWAYS Chapter: 1 1.1 Introduction The Problem Solving and Decision making process focuses on the competencies for effective problem analysis and evaluation for problem solving. It includes process like finding the root causes, generation solutions with alternatives and making appropriate decisions. The issues occurred in Jet Airways are analyzed using models and solutions are...
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...POSITION PAPER ON THE AIRPORTS SECTOR IN INDIA May 2009 Department of Economic Affairs Ministry of Finance Government of India AIRPORTS SECTOR EXISTING SCENARIO 1. The civil aviation traffic has seen an unprecedented traffic in the past few years on account of booming Indian economy, growing tourism industry, entry of low cost carriers in the private sector, liberalization of international bi-lateral agreements and liberalization of civil aviation policy. In future also the civil aviation traffic is expected to grow at the same pace despite current slowdown due to global recession. But airport infrastructure has not kept pace with the growth of the civil aviation traffic. This has resulted in congestion and inefficient services in major airports, limited landing slots, inadequate parking bays and congestion during peak hours for airlines. Development of quality infrastructure will have an impact on international competitiveness and economic growth. This requires faster development of civil aviation infrastructure on public private partnership mode. In tune with the requirement many initiatives have already been started in the 10th five year plan and they are expected to continue in the 11th plan also. 2. Of a total number of 454 airports and airstrips in India, 16 are designated as international airports. The Airports Authority of India (AAI) owns and operates 97 airports. A recent report by Centre for Asia Pacific Aviation (CAPA) states that over the next 12 years...
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...Jet Airways – Etihad Airways Strategic Alliance Jet Airways.com Jet Airways and Etihad Airways are proud to announce the conclusion of the transaction for the subscription of 24 per cent minority equity stake in Jet Airways. This follows all government and regulatory approvals received on the 12th of November 2013. The infusion of foreign direct investment in the Indian aviation sector will result in economies of scale, growth in traffic at Indian airports and will create job opportunities across the aviation and tourism sectors. It will greatly benefit all our stakeholders whilst significantly benefitting our guests who will now have access to a more expanded global network, enhanced connectivity for tourists, business travellers, and the wider travelling public. India is one of the largest and fastest-growing markets in the world. Through this association, Jet Airways and Etihad Airways will both be strengthened as will be the economies of India and the UAE. By linking our two networks and adding new flights, new routes and more code-share options, travel to, from and within India will become more accessible/ convenient. Etihad Airways and Jet Airways will combine their network of 130 destinations, with Jet Airways establishing a Gulf gateway in Abu Dhabi and expanding it’s reach through Etihad Airways’ growing global network. Under the strategic partnership, both airlines will gradually expand existing operations and introduce new routes between India and Abu Dhabi thus...
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...Jet airwaysMerger of Jet Airways & Air Sahara JET AIRWAYS INTRODUCTION Jet Airways (India) Ltd. is an airline based in Mumbai, India, operating domestic and international services. It operates over 330 daily flights to 50 destinations across the country and 6 overseas. Its main base is Chhatrapati Shivaji International Airport, Mumbai, with hubs at Indira Gandhi International Airport, Delhi, Anna International Airport, Chennai, Netaji Subhash Chandra Bose International Airport, Kolkata, Bangalore International Airport, Bangalore and Brussels Airport, Brussels According to the latest available figures, its share of India's domestic aviation market has increased to over 43% (up from less than 27% a few months ago), and this is still greater than any other Indian domestic operator's market share.[ HISTORY: Jet Airways was incorporated as an "air taxi" operator on 1 April 1992. It started commercial airline operations on 5 May 1993 with a fleet of 4 Boeing 737-300 aircraft. In January 1994 a change in the law enabled Jet Airways to apply for scheduled airline status, which was granted on 4 January 1995. It began international operations to Sri Lanka in March 2004. Plans to acquire rival Air Sahara, announced in January 2006, after some rough patches deal got through. The airline is owned by Tailwinds (owned by Naresh Goyal) (80%) and public shares (20%) and has 10,017 employees (at March 2007). Naresh Goyal, who already owned Jetair (Private) Limited (which provided...
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...The Government aim is to change the industry to more equality and investment of social atomosphere.The government added a lot of new airports and converted Morden airports for the country. It also improved the policies which provide eventual opportunities. In the aviation Industry there are also severe challenges faced by the air carriers in order to survive in the marketing industry. Though there are a lot of new entrants entered the industry they were unable to compete and eventually withdrawn them from the industry. They also met heavy debts and financial crisis Players in Indian aviation industry can be classified into three groups: Public players: Air India, Indian Airlines, Alliance Air. Private players: Jet airways, Air Sahara, Spice jet, Air Deccan. Start-up players: Planning to enter the market some of them are Omega Air, Magic Air, and Premier Star Air and MDLR airlines. Types of Indian aviation...
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...OPERATION STRATEGY IN SERVICE: Jet Airways and Indigo. Both are India’s fastest-growing domestic market in aviation. OBJECTIVE AND STRATEGY: Jet Airways: Jet Airways objectives achieve consistent profitability, achieving healthy, long-term returns for the investors and providing its employees with an environment for excellence and growth. 1. Changes to its cost structure. 2. Factors affecting demand in international travel to and from India, including the general condition of the global economy. 3. Operational, financial, marketing and legal challenges (including compliance with foreign laws) that are different from those that we currently meeting. 4. Its ability to operate and manage in a cost effective manner, a larger operation. 5. Ability to secure a sufficient number of additional aircraft on favorable lease or purchase 6. Its ability to trained sufficient numbers of pilots, flight crew and engineers with international experience. In-flight services of Jet Airways: 1. Jet Screen offers a virtual feast of entertainment for the guests- from blockbuster movies to the latest music albums, from award-winning TV shows to the best games, experience a journey that redefines in-flight entertainment in every dimension. 2. Its in-flight meals are designed keeping in mind the varied guests. 3. Amazing comfort, efficient service and delicious meals are the 3 ingredients that make up the Jet Airways Premiere experience. And with a crew...
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...Contents Letter from the Chairman Operating Highlights Financial Highlights Corporate Information Notice of the 22nd Annual General Meeting Directors’ Report Management Discussion and Analysis Corporate Governance Report Auditors’ Report Balance Sheet Statement of Profit and Loss Cash Flow Statement Notes to the Balance Sheet and Statement of Profit and Loss Statement relating to Subsidiary Company Consolidtated Statement of Accounts Attendance Slip and Proxy 02 04 05 06 07 16 24 29 47 52 53 54 56 93 94 135 Letter from the Chairman Dear Shareholders, Financial Year 2013-14 was an exceptionally challenging one for the Indian aviation sector. The Indian economy recorded a lower GDP growth rate of 4.7%. Currency volatility and devaluation of the Indian Rupee further exacerbated the situation, leading to a drop in discretionary travel. Consequently, passenger load factors across our industry were under pressure and domestic passenger growth slowed to 4.8%. In this challenging environment, your Company managed to maintain revenues, though costs were hit due to depreciation of the Indian Rupee (of over 11%), higher aviation turbine fuel (“ATF”) rates and increased airport levies. Your Company has been consolidating its domestic network with a focus on strengthening its presence in key markets. Your Company has also been regularly adding international routes, besides embarking upon systematic improvement of its products across all classes of travel. Further, your Company has been strongly...
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...standards, which other competing airlines will seek to match. To achieve this pre-eminent position by offering a high quality of service and reliable, comfortable and efficient operations. Jet Airways will achieve these objectives whilst simultaneously ensuring consistent profitability, achieving healthy, long-term returns for the investors and providing its employees with an environment for excellence and growth. Jet Airways, which commenced operations on May 5, 1993, has within a short span, established its position as a market leader. The airline has had the distinction of being repeatedly adjudged India‟s „Best Domestic Airline‟ and has won several national and international awards. Founded in April 1 , 1992 Destinations:- 76 (24 international destinations and 52 destinations within India) Jet Airways currently operates a fleet of 101 aircraft Naresh Goyal, the founder Chairman of Jet Airways, India‟s premier airline, has over 4 decades of experience in the Civil Aviation industry and also appointed Chairman of JetLite in 2007, following the acquisition and subsequent re-branding of the erstwhile Sahara Airlines Limited.(subsidiary ) Jet Lite is a subsidiary of Jet Airways India Ltd. and was acquired by Jet Airways in April 2007. Effective March 25, 2012, Jet Lite and Jet Airways Konnect services operate under the JetKonnect brand. Positioned as a Value based airline, JetKonnect operates a fleet of 17 Boeing 737 series aircraft. The airline flies to 56 domestic...
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