Introduction Airblue is a private Pakistani airline based at Jinnah International Airport Karachi. It started its operations on May 24, 2004. It was the first private carrier of Pakistan to operate the Airbus A320 when it initially started. Airblue has been expanding rapidly despite experiencing competition from the other three airline operators in Pakistan. The airline mainly flies on domestic routes plus internationally to Dubai International Airport and also has plans to fly to the Gulf, UK, and USA. Mission Statement Airblue will be recognized as the most progressive enterprise in the transportation business.
We will offer our customers cost effective transportation service within geographical areas and market segments that can benefit from our services and will insure a return on investment and growth rate consistent with current management guidelines. Vision Statement Our vision is to make Airblue the most admired airline in the world. * Ensuring safety comes first * Providing Service Straight From the Heart * Encouraging product leadership * Delivering superior financial returns * Providing rewarding career opportunities SWOT analysis of airblue 3 TheSWOT analysis is the process of analyzing organizations nd their envi ronments based on their strengths, weaknesses, opportuni ties and threats. This includes the environmental analysis, the process of scanning the business environment for threats and opportunities, which is considered as external factors, and the organizational analysis, the process of analyzing a firm’s strengths and weaknesses as internal factors. SWOT analysis was carried out for AirBlue and the results are summarized as follows: Strengths 1. Second largest air-carrier of Pakistan, enjoying almost 30 percent market share on domestic routes. . Airblue is a Low-cost carrier (LCC). The reason behind air blue’s low fares is that it uses Dynamic Pricing Model. Airblue puts its entire ticket inventory on the Net and direc t internet booking accounts for 15% of its sales. It begins selling tickets at a 40% discount to full service carriers (FSCs), but closer to the date of your travel, you may end up paying up to 30% pre mium ove r the price charged by FSCs. 3. 98% punctuality of on-ti me flight departures. 4. Innovative e-ticketing and wireless check-in technologies. 5. Operational efficiency. 6.
Airblue is using latest technology for the airline’s advantage and its valued customers. Many corporate entities tried to create a paperless work environment, in order to mini mize its costs and maximize its efficiency, but only Airblue had been successful to the extent that its management does not need offices to function. 7. The airblue aircraft are the latest fly-by-wire technology Airbus A320’s and A321’s. This allows the airline more flexibility and scales of economy in crew planning and maintenance capability, adding directly to bottom-line profitability. 8.
Lesser workforce because of extensive technology usage. 9. AirBlue is the first among public and private sector airlines in South-Asia and second after Emirates in the region to introduce latest s elf check-in system at Karachi airport. The self check-in system will facilitate the passengers carrying SWOT analysis of airblue 4 baggage with them, to get boa rding card through the new touch screen system without reporting at the counter. 10. Package for students and special children. 11. Good food, good entertainment, spacious seats, most exciting hospitality, elegant and charming hostesses. 2. Year 2006 witnessed exceptional performance in the short term financing which was reduced from Rs 206 million to Rs 48 million, showing a decrease of 330 percent. 13. Airblue showed a record operating profit of over Rs 150 million for year 2006 while provi ding a high quality product to the consumers. 14. Airblue outsources most of its secondary tasks to third parties. It helps airline to cut costs. Weaknesses 1. Difficulty in developing brand-awareness as a startup company. 2. Engaged only in passenger service, whereas its competitor PIA is also providing cargo services (SPEEDEX). 3.
Not having its own repair and maintenance facilities. 4. Doing less on the advertising and promotion of air line. 5. Not operating flights for Hajj Pilgrims, which could be a major source of income. 6. Small fleet of air crafts. 7. Two aircrafts are acquired on dry lease and one on wet lease. 8. It connects only seven cities in Pakistan. 9. Very tight schedule of flights, which puts extra burden on pilots, cabin crew and hostesses Opportunities 1. Year 2007 is being celebrated as “Visit Pakistan Year”. So, the number of foreign visitors is likely to increase and complimentary tourism industry will increase demand for airline service. . Agreement with Airbus Industries for the purc hase of eight airbus A320-200 and two airbus A330-200 aircrafts for an estimated cost of $ 790 million. New aircrafts will be used for additional frequencies and destinati ons on domestic and regional routes. 3. Low fares enable market share growth. 4. Introducing new domestic and international routes like Gulf, UK, Jordan, India etc. 5. Stable economy and growing GDP. 6. The air transport sector of Pakistan woul d also get a boost from newly developed Port of Gwadar in the Balochistan province. The development of the
Gwadar Port, the third deep sea port of the country and the first of Balochistan, would serve as a link with the Central Asian States. The government is upgrading the Gwadar International Airport at a cost of 480 million rupees. Once upgraded, the airport will be able to handle wide -body aircraft such as Airbus and Boeing 747 aircraft. 7. Poor performance & red tapism in PIA. 8. Worldwide deregulation makes the skies more accessible, Open Skies. 9. Excellent credit rating allows Air Blue to purchase its expansion strategy. Threats 1. Escalating jet fuel prices. 2.
Low-cost Chinese airlines planning to enter into Pakistan’s domestic air marke t. 3. Cutthroat price war among airlines. 4. Buses business continuously improving speed in service in mid and long distant routes, attracting passengers away from air service. 5. PIA is also procuring 10 new Boeing planes. 6. Threat of terrorism. 7. No level-playing field for private airlines, as government always rescues PIA from risks. 8. Incapability of national airport runways to handle big crafts. 9. Competition is heating up as four new local airlines are going to start their operati ons very soon. 10. High insurance costs for aircrafts and passengers.
Comments AirBlue has performed very well so far. It has tried to build strategy on genuine understanding of the customers’ true needs. It identified key customer satisfaction drivers, and then turned into a foundation to shape company development strategies and innovations. The objective is to realize the quality-strategy integration. 1. AirBlue should adopt an aggressive marketing strategy to promote airblue as a customer-driven airline. 2. It should continue to be innovative in introducing latest technologies to reduce its costs and enhance customers’ ease, satisfaction and its profits as well. SWOT analysis of airblue 3. Currently,i t’s only the national flag carrier PIA which operates frequent flights during Hajj season. Airblue can make a huge dent on PIA’s profits if it’s able to capture some share of Hajj pilgrims. 4. AirBlue is doing well against PIA, but it should adopt proactive strategies to compete with Chinese airlines. 5. There is a huge potential in domestic market because it’s operating flights for only seven cities. So, airblue should expand its network. References 1. www. airblue. com. pk 2. A. M Ahmed and M. Zairi, “SWOT analysis for Air China performance and its experience with quality”, (http://www. meraldinsight. com/1463-5771. htm) 3. http://en. wikipedia. org/wiki/Airlines_of_Pakistan 4. www. piac. com. pk 5. “Aviation: Competition Heats Up” (Pakistan Economist – Cover Issue 12, 3/22/04) Services  Cabin Airblue currently operates a mixtue of Airbus A321, A320 and A319s. All aircraft are in a 3 by 3 all economy layout.  There are several overhead screens located after several rows. The airline dropped its Business class section due to exogenous economic factors. The layout was 2 by 2 with inflight televisions and leather seating.   eTicketing [pic] [pic]
Karachi is the hub for most of Airblue’s domestic operations Airblue was the first airline in Pakistan to introduce e-ticketing, wireless check-in and self check-in kiosk facilities. The airline also became a member of Sabre system that is used by over a hundred airlines to help it with ticket automation service.  OnAir deal OnAir has announced an agreement with Airblue, Pakistan’s fastest growing airline, to launch Mobile OnAir voice and data services on up to 12 of its Airbus A320 aircraft beginning in 2009.   Frequent Flyer Program Airblue frequent flyer program is called Blue Miles.
Passengers are able to initially start on the base level where sign up is free. Once passenger earn enough miles, the are upgrades to the Blue Card followed by the Platinum Card. In May 2009, the airline formed an alliance with The Royal Bank of Scotland Limited (RBS) to launch its summer promotion on its credit cards.   Lounges Airblue inaugrated its own premium lounge at Jinnah International Airport, Karachi in November 2008. Nicknamed, the Blue Lounge International, it was designed for business class passengers, credit card holders and privileged customers.
The lounge offers a number of internet facilities, cable television, newspapers and magazines, massage chairs as well as a snack bar. It is located in the international wing of the airport.  Joint venture with JS Air To comply with Civil Aviation Authority (CAA) regulations the airline started operating on socio-economic routes by flying to Nawabshah in central Sindh however the service was soon suspended because of low passenger load factors and the unsuitability of the A320 aircraft for this route. The suspension meant that Airblue was not compliant with CAA regulations and therefore had to incur penalty fees.
To overcome the issue of non-compliance Airblue entered into a joint venture with start-up charter airline JS Air to operate flights on its behalf on socio-economic routes. This represented the first time in Pakistani aviation history that 2 air operators entered into a joint venture arrangement. The first destination under this agreement was the port city of Gwadar which was connected to the Airblue network on 17 June and was served twice daily, except Fridays, from Karachi. The flights were operated using JS Air’s 19 seater Beech 1900C aircraft which are specifically suited to serving low yield ‘commuter’ destinations.
This service was also suspended in 2007 due to insufficient demand despite using suitable aircraft.  Cost cutting measures To deal with the fuel price hike worldwide, Airblue are converting their fleet to all economy class. This will also be applied to their new aircraft, which will be delivered starting in 2009. They are also ending full meal services and replacing it with sandwiches and pastries. In 2006 Airblue did away with chinaware crockery service for meals in economy class to cut costs and weight, replacing it with plasticware as per normal industry practice. [pic] [pic]
Dnata handles the majority of Airblue’s ground services within Pakistan as well at most of its oversea operations  Ground services Passengers may check-in between two to 48 hours prior to flight departure. This may be done over the counter or at the self-service kiosks. Currently self service kiosks are available at Jinnah International Airport and Allama Iqbal International Airport. Dnata the aviation services company handles the ground and passenger handling for the airline at all of the airports the airline operates from. Gate Gourmet provides food and beverage services to the airline.  Cargo operations
Airblue have launched e-Cargo service to cater to air freight markets of Pakistan, UAE and UK.  According to a press release, e-Cargo will broaden the base of cargo and permit certified agents to book freight directly online opening the inventory through the web. Future Plans KARACHI: Airblue has announced expansion of its economy class seats on aircraft from May 1, replacing its business class with an additional 23 per cent to meet growing demand in air travel. The Airblue plan anticipates an increase in demand for affordable fares, comfort, more in-flight amenities and more destination options, said a press release. Airblue has always been committed to setting a higher standard for air travel, and that now includes world class economy class,” the statement quoted Nasir Ali, Managing Director of Airblue, as saying. “Today’s passenger is savvy and expects a higher standard in economy class travel. We are going to meet this challenge by setting our standards even higher. ” Over the past three years, Airblue has grown to be the largest private airline in Pakistan. Future Airblue expansion plans include flights to the UK, Scandinavian countries, the UAE, Middle East, India and Bangladesh.