Singapore Airlines: Analysis of Threats in Strategic Management

This report provides a SWOT analysis of Singapore Airlines, focusing on the threats the company faces. The analysis identifies key threats such as increasing competition from airlines like China Southern, Emirates, and Qantas, as well as the rise of Gulf carriers. The report also examines the impact of government regulations, rising fuel costs, and economic fluctuations on the airline's profitability. Furthermore, the report discusses the challenges posed by low-cost airlines and the issue of overcapacity in Southeast Asia, affecting Singapore Airlines' market share and yield. The report concludes by emphasizing the importance of minimizing these threats to ensure the company's growth and success. The provided bibliography includes sources such as the Journal of Air Transport Management and Managing Service Quality: An International Journal.

Running head: Singapore Airlines
Strategic management

Singapore Airlines
SWOT Analysis
Threat
In context to the Singapore airlines it has been seen that the company faces many threats.
One of the major threats is from the increasing level of competition. The company is facing huge
competition in the market. There are many competitors who are offering same services in the
market and also they are focusing on considering the good customer share in the market so that
growth and objectives be achieved in the proper manner.
The competitors who are present in the market are China Southern Airlines, China
Eastern Airlines, Emirates Airlines and Qantas Airlines. The increase in the Gulf Carriers is also
the biggest single driver of the Singapore fall in context to the profits and growth in the few
decades. Gulf carriers have given impact on the market of the company. Also the next threat is
related with the government regulations. Just because of the rules related to price and many other
the company is not able to conduct the activities in an effective manner. The rise in the fuel rates
has given negative impact on the profits of the company. The profits of the company is reduced
which will be depicted from the above graph. The margin level has been reduced of the company
just because of the rise in the price fuel cost. It has been seen that that the rise is almost 52
percent since June 2017 to around $68 a barrel. Due to this the cost of the company enhances
which is threat to the company. In the last five years the jet cost was enhanced by 9 percent (Fan
and Lingblad, 112-122).
Due to the economic fluctuation the company has to face the high cost of competition
from low cost of airlines globally. In 2010, the budget airline has 20% of the Asian market which
will enhance on the continuous basis. It is reducing the stoppage time in the flights and it is the
challenge for the company to enhance the satisfaction (Wirtz, Loizos and Nitin, 4-19).
The company is also been one of the biggest companies in the premium space but the
competitors who are present in the market have reduced the gap in the present years. The
company still has one of the best premium products in the company but there are many airline
industries that are near or top of the class. The company also introduced the business class
product of long haul fleet and also it shows the leap beyond the other competing products. But in
the present scenario, there are many airlines who have introduced many similar business class
products which has reduced the gap. Like European and North American carriers which
considered various generations behind and have closed the gap. (Heracleous and Jochen, 150-
170).
From the few last years it has been analyzed that Southeast Asia market is facing the
issue of overcapacity. The competitors of the Singapore airline has considering the full service
flag carriers and also LCC’S that has focus on the overall increase in the demand. In the recent
scenario the demand is still enhancing in the South East Asia which has been boosted by the
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Singapore Airlines
economic and middle class growth. There are many other airlines that are focusing on making
adjustments but the level of competition will be remained intense and also many times it can be
irrational for short term. In the airline sector there are groups like Indonesia Lion Air which are
enhancing their operations across the borders. This has given the outcome of the Singapore yield
and also the load factor will still pertain to be in pressure (Pearson, O'Connell, Pitfield and
Ryley, 1-10).
Therefore, these all are the threats that should be minimized by the company to achieve
growth in the market.
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Singapore Airlines
Bibliography
Fan, T. P. C., & Lingblad, M. (2016). Thinking through the meteoric rise of Middle-East carriers
from Singapore Airlines' vantage point. Journal of Air Transport Management, 54, 111-
122.
Heracleous, Loizos, and Jochen Wirtz. "Singapore Airlines: Achieving sustainable advantage
through mastering paradox." The Journal of Applied Behavioral Science 50, no. 2 (2014):
150-170.
Pearson, J., O'Connell, J. F., Pitfield, D., & Ryley, T. (2015). The strategic capability of Asian
network airlines to compete with low-cost carriers. Journal of Air Transport
Management, 47, 1-10.
Wirtz, Jochen, Loizos Heracleous, and Nitin Pangarkar. "Managing human resources for service
excellence and cost effectiveness at Singapore Airlines." Managing Service Quality: An
International Journal 18, no. 1 (2008): 4-19.
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Singapore Airlines
Appendices
Growth rate reduced of the company
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