Qantas Losing International Competitiveness

Running Head: QANTAS LOSING INTERNATIONAL COMPETITIVENESS
QANTAS LOSING INTERNATIONAL COMPETITIVENESS GLOBALLY FOR
DOMESTIC HIGH COSTS

QANTAS LOSING INTERNATIONAL COMPETITIVENESS
Abstract
Qantas airways are a flagship carrier of Australia and have the largest fleet in size,
international flights and international destination. The recent surge in globalization and
technological advancement has increased competition in the airline industry. With surging fuel
prices and increasing wages across Australia, Qantas is struggling in the recent period to
maintain its profitability. The scope of the current discussion focuses on analyzing the
competitive pressures faced by Qantas airways along with suitable strategies that the company is
devising to overcome them. Amongst the various strategies employed by Qantas to maintain its
profitability, transforming to digital systems in its operations has been effective in reducing costs
for the company.
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QANTAS LOSING INTERNATIONAL COMPETITIVENESS
Table of Contents
Abstract............................................................................................................................................2
Introduction......................................................................................................................................4
Literature Review............................................................................................................................4
Research Methods............................................................................................................................7
Findings and Analysis......................................................................................................................7
Conclusion.......................................................................................................................................9
References......................................................................................................................................10
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QANTAS LOSING INTERNATIONAL COMPETITIVENESS
Introduction
The global airline industry is currently facing turbulent conditions from the increasing
competition from small airliners and surging fuel prices (Duval, 2016). Large airline operators
are devising a number of strategies in order to maintain business viability and continue earning
profits. Higher operational costs have begun to trouble airlines with a vast number of fleets. The
current case proposal highlights Qantas Airways in Australia, which is reeling under burdensome
operating costs. Qantas airways being a flag carrier of Australia covers a large number of
international destinations with a vast number of flights. Founded in 1921, it is the third oldest
airline in the world. The Company employs over 26,150 people globally and has its headquarters
located in Mascot, Sydney. Leigh Clifford, AO is its current Chairman and Alan Joyce, AC is
CEO. The Company is currently reporting an underlying loss and is attributing it to its high costs
and wages for the same. Rising fuel costs are also factors that have deteriorated the cash reserve
of the Company (Barbot, 2011). The scope of this analysis deals with the competitive pressures
acting on the airlines along with strategies it is deploying to overcome the same.
Literature Review
A brief literature review will encompass the various topics which will reveal that current
challenges faced by the airlines and strategies to overcome the same. The literature review will
provide a theoretical construct for the study.
 External Factors Analysis
Analysis of external forces for Qantas airlines is undertaken by reviewing
PESTLE factors. PESTLE is an abbreviated form analyzed as below;
Political Factors: The Federal Government has a substantial shareholding in Qantas. This
enables bureaucratic influence in favor of the airlines (Oum & Yu, 2012).
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