Airline Marketing and Business Models

Airline Marketing and Business Models
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Contents
Contents............................................................................................................................................2
INTRODUCTION.............................................................................................................................3
HISTORY..........................................................................................................................................3
SWOT Analysation of TAP on the basis of analysing operational, financial and competitive
attributes.......................................................................................................................................3
OPERATIONAL CHARACTERISTICS..........................................................................................4
Route structure.............................................................................................................................4
Traffic volume.............................................................................................................................5
Fleet size and type........................................................................................................................6
Product.........................................................................................................................................8
FINANCIAL PERFORMANCE.......................................................................................................8
Profitability..................................................................................................................................9
Costs...........................................................................................................................................13
COMPETITIVE SITUATION........................................................................................................15
Competitor airlines....................................................................................................................15
Alliance strategy........................................................................................................................15
Geographical position of TAP Air.............................................................................................16
CONCLUSION...............................................................................................................................17
REFERENCES................................................................................................................................17
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INTRODUCTION
TAP AIR PORTUGAL is state-owned flag carrier airline in the Portugal. TAP refers to the
Transportes Aereos Portugueses. It has been determined as the member of star Alliance from
2005. The TAP air operates the average of the 2500 flights in a week in the 34 countries
worldwide. TAP Portugal has been certified as the 3-star Airline in context of its quality services
in the airport, product and staff services. The service rating has been assured for both of its cabin
and ground staff. (TAP AIR, travel technologies, 2020). The TAP Airlines have attracted the
customers within keeping the price of tickets low and assuring effective services. The TAP
Airlines offers passengers connection to the 965 destinations.
The present report will analyse the operational attributes, financial performance and
competitive situation which is being faced by the TAP Air. The critical analysation within
evaluating strengths and weakness of the of the selected airline will be covered in report.
HISTORY
In regard to Airline industry, it can be said that it encompasses a wide range of businesses
that are called airlines. This sector is specialised and known for qualitative transport services for
paying customers. Along with this, Tap Air Portugal is state owned flag carrier airline of Portugal
and headquarter is located at Lisbon Airport that known as company Hub. TAP has been flying
more than 26 million miles a year to 85 destinations on three continents for carrying average 3
million passengers. The organization have maintenance and repair facilities that work for other
airlines which is located at Lisbon Airport. It also provides additional maintenance facilities such
as Africa and Brazil as well it promotes tourism for Azores and Portugal as well as it has stoppage
of African and European Destinations (History of TAP , 2022). In addition to this, company was
founded in year 1975 on 14 march by secretariat of Portuguese and its mission was to provide
regular and quality air service between Portugal and neighbouring territories. Furthermore, airline
began commercial services on 19 September 1946 performing flight from Lisbon to Madrid by
caring out total 11 passengers on the aircraft like DC-3s. In July 1962 TAP entered the jet era
and have three batch of French build Sud Aviation Caravelle an early twin jet airline and it was
first operated in European routes.
SWOT Analysation of TAP on the basis of analysing operational, financial and competitive
attributes
Strengths Weaknesses Opportunities Threats
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TAP Air assures
effective services in
the cheapest rate
which is the major
strength of the
company and helps
company to expand
and attract large
number of customers.
The major weakness
of the company is that
it does not increase
their tickets prices
which creates the
situation related to
low profitability.
Potential opportunities
for TAP are that, the
company can grow
within increasing their
destinations as the
analysation has shown
that company has
increased the number
of passengers.
The major threats for
TAP is that,
competitor have also
started approaching
low price strategy in
high quality services.
Therefore, TAP needs
to tale more strategies
in this context.
OPERATIONAL CHARACTERISTICS
Route structure
Before Covid-19 and after the year of 2013, TAP has increased its seats number on Newcastle by
14% and it is still considered as the largest airline with around 22% of seats.
It has increased its capacity by more than 50% over past 3 years and seats share has also grown to
the great extent.
Below are some data that can prove that TAP Airline has increased its seats number.
Top 1 route pairs of TAP Airline
Route Pair Number of Seats
London (LIS) Sao Paulo (CNF) 298
Lisbon Fortaleza 292
Rio de Janeiro Lisbon 150
Lisbon (LIS) Dakar (DSS) 216
Lisbon (LIS) London (LHR) 174
BCN ( Barcelona ) TLS (Toulouse) 106
Lisbon (LIS) Miami (MIA) 298 seats
Sources: (TAP Airlines details., 2022)
This above data shows route pairs of Tap Airlines along with number of seats and on the basis of
this, it can be said that TAP has taken an average 4000 passenger in each day. On this basis, it can
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