Airline Revenue Management: Comparing Financial Metrics and Suggestions for Improvement

Airline Revenue
Management

Table of Contents
INTRODUCTION...........................................................................................................................1
PART 1............................................................................................................................................1
Background of the company .......................................................................................................1
PART 2............................................................................................................................................2
Compare the financial metrics of the company by Ratio analysis ..............................................2
PART 3............................................................................................................................................3
Comparing and contrasting the ratio of two company and suggestions for improvement .........3
CONCLUSION................................................................................................................................4
REFERENCES................................................................................................................................5

INTRODUCTION
Airline revenue management is the technique designed to measure the financial
performance of the airlines in the terms of revenue and it is based on fares to provide the
excellent seats to the customer which pay high fare, in the airlines industry, they focus on various
segment to measure the financial position of the company in the Full service network carrier and
low cost carrier, full service airline is generally used by the airlines which provide full fight
entertainment, checked baggage include blankets, pillows and comforts in the ticket price. A low
cost carrier is an airline that is operated with high motive on minimize the operating cost and no
additional service is provided in fare (Kadatz, 2017). In this report, British Airways is taken for
the full service network carrier and for low cost carrier Easy jet airline is take to compare and
contrast the financial position by taking ratios of both company. Apart from these there is
suggestion also provide to improve the financial performance in respect to revenue and costs.
PART 1
Background of the company
First is the British Airways Plc, it is a British air transport company found in April, 1974
in the fusion of British overseas Airways Corporation, it is the largest international airline in the
world. It serves 95 million passengers in a year by using 441 number of airports in the 86
counties, it operate more than 1000 planes it is listed on the London stock Exchange and
generated more than 1 billion on a single air route in a year. In the economy background of this
airline, comes with hand luggage, freedom to choose own seat and in the financial background
IAG reported loss of 4.2 for the first half of year and passenger fell 98% between April to June
period. Their major subsidy include in this are continental Europe, OpenSkies and BacityFlyer.
Second is Easy jet, it is British multinational Low cost airline headquarter at London
Luton Airport, which is found in march in the year of 1995 by the businessman Stelios Haji-
loannou, at that time he is 28 years old. In this company first fight is from London- Luton to
Glasgow which took place on 10 November 1995. the takeover of the British Airways spin – off-
cost airline in Europe. It has total number of routes are 279 and 74 airports. Their financial
performance raise over 2.4 billion in the August 2020, 600 million is came from the Covid
corporate provided by the UK government and 400 million raised through shares. For the
economy they employed 15000 people in the UK. They make the group with the associate
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