Global Strategic Management Assignment of Emirates Airline
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Added on 2020-05-16
Global Strategic Management Assignment of Emirates Airline
Added on 2020-05-16
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Running head: EMIRATES AIRLINE0Global Strategic ManagementEmirates Airline
EMIRATES AIRLINE1Table of Contents1.Introduction........................................................................................................................31.1 About the company..........................................................................................................31.2 Vision...............................................................................................................................41.3 Mission.............................................................................................................................41.4 Key Issues Face by Emirates Airline...............................................................................42.Analysis of External Environment.....................................................................................62.1 PEST Analysis.................................................................................................................62.1a Political Factors..........................................................................................................62.1b Economic Factors.......................................................................................................62.1c Socio-cultural Factors.................................................................................................72.1d Technological Factors................................................................................................82.2Porter’s Five Forces.....................................................................................................82.2a Threat of new entrants................................................................................................92.2b Supplier Power...........................................................................................................92.2c Buyer Power.............................................................................................................102.2d Threat of Substitution...............................................................................................102.2e Competitive Rivalry.................................................................................................103.Analysis of the Internal Environment..............................................................................113.1 Porter’s Value Chain Analysis.......................................................................................113.1a Primary activities......................................................................................................113.1b Support Activities.....................................................................................................133.2 TOWS Matrix.................................................................................................................154.Recommended strategies..................................................................................................165.Conclusion........................................................................................................................18References................................................................................................................................19
EMIRATES AIRLINE2
EMIRATES AIRLINE3List of FiguresFigure 1: Emirates Airline's Logo..............................................................................................4Figure 2: Increase in Jet Fuel Prices..........................................................................................5Figure 3: GDP of UAE...............................................................................................................7Figure 4: Yearly Population Growth Rate in UAE....................................................................8Figure 5: Competitors of Emirates Airline.................................................................................9Figure 6: Value Chain of Airline Company.............................................................................11Figure 7: Emirates Fleet Size Growth......................................................................................14
EMIRATES AIRLINE41.IntroductionThe aim of this report is to introduce Emirates Airline, its vision, mission, products, and keyissues. Further, this report will analyse the external and internal environment and providestrategy alternative and recommendations for sustaining the company’s future growth.1.1 About the companyThe Garhoud, Dubai, UAE headquarters based airline, Emirates, was founded in 25th March1985 and it started its business of providing commercial air transportation services on 25thOctober 1985 worldwide (Emirates, 2018a). The company is a subsidiary of ‘The EmiratesGroup’, and it is wholly owned by the Investment Corporation of Dubai’s government. In theaviation industry, the corporation has gained a prestigious rank due to its effective businessstrategies that focus on encouraging fair competition, open skies policies, and transparency.The fleet size of the firm includes 270 aircraft, and it has planned to add more than 20 aircraftin the future (Planes Potters, 2018). Currently, the company fly its passengers to more than 155 destinations in over 80 countriesaround the world. Each week, more than 1,500 Emirates flights departed from Dubai airport,and they fly its passengers on six continents (Altaf, 2017). The corporation has employedmore than 64,768 employees around the world (Emirates, 2017a). The services of thecompany include worldwide destinations, regionally inspired cuisine, world-class facilities,industry-leading in-flight entertainment and others. The seating options offered by the firminclude a full suite with doors, horizontal bed (without doors) and sleeper seats.In 2017, Emirates Airline generated a profit of US$340 million, and the Emirates Groupreported a profit of US$670 million. The company reported a drop of 82.5 percent in itsprofits as compared to 2016 profits. It is the first drop in the firm’s annual profit in previousfive years which caused due to competition, US dollar’s rise and travel restrictions (AlJazeera, 2017). As per Latest Oxford Economic Report, the aviation industry will contributeUS$53.1 billion in the economy or 37.5 percent of the GDP of Dubai by 2020. It is alsopredicted that in the report that more than 754,500 jobs will be supported by the aviationindustry (Gulf News, 2014). Emirates Airline plays a crucial role in contributing to thecountry’s economy as it is the largest airline in the Middle East.
EMIRATES AIRLINE5Figure 1: Emirates Airline's Logo(Source: Emirates, 2018a)1.2 VisionTo make the experience of civil aviation flight safer for its passengers and leading andsustaining growth by focusing on providing industry-leading services (Emirates, 2017a).1.3 MissionTo become the world leader in the aviation industry by delivering the world’s best in-flightexperience to our passengers (Emirates, 2017a).1.4 Key Issues Face by Emirates AirlineIncreased CompetitionEmirates Airline has provided in its announcement of half-year performance for 2017-18 thatstiff competition resulted in decreasing its profits in 2017 (Emirates, 2017b). The companywas under pressure to reduce its ticker prices due to fierce competition from other airlinefirms such as Etihad Airways, British Airways, Singapore Airlines, Lufthansa, MalaysiaAirways and others. According to the International Air Transport Association (IATA), thegrowing regional competition in UAE is one of the major factors that negatively affect the
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