DOGFIGHT OVER EUROPE RYANAIR PDF

You are on page 1of 3 Search inside document 1. Ryanair was launched with two important strategies in mind. They wanted to deliver first-rate customer service, with meals and amenities comparable to what Aer Lingus and British Airways provided. They wanted to be positioned in the same comfort category as the mentioned airlines. They were planning on establishing a comparative advantage in terms of the price that it offered. They charged a simple, single fare for a ticket with no restrictions.

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However, the success of this strategy would require Ryanair to manage the expenses and keep costs low. Ryanair has decided to offer full service meals and amenities while offering lower price.

This would definitely put strain on the costs. Moreover, they are planning to get a larger aircraft. This will increase aircraft maintenance costs as they will have to service 2 different types of aircrafts. Also it is important that Ryanair focus on this route turn it profitable before they decide to expand to other routes. Growing too fast will increase costs further. In second, his position as late-movers, allowed them to enter in the market with a lower price than its competitors.

A lower price is a good strategy to quickly gain market share. How do you expect Aer Lingus and British Airways to respond? Since, Ryanair will be providing comparable service for less than half the price, Aer Lingus and British Airways will have no choice but to lower their price. This would further erode the profit margins. The only silver lining for the airlines was to convert few of currently K people who used rail and ferry rather than British Airways had made tremendous strides during pre to improve its profitability, and was preparing to go private in By , BA had operating margins of 6.

Aer Lingus, on the other hand was government sponsored and by served both local and trans-Atlantic markets, primarily subsisting on tourist fares.

While AL was not profitable on those trans-Atlantic flights, its regional flights were modestly profitable, especially London-Dublin route which earned a reasonable return on capital. AL Management had diversified into

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Dogfight over Europe: Ryanair (A)

However, the success of this strategy would require Ryanair to manage the expenses and keep costs low. Ryanair has decided to offer full service meals and amenities while offering lower price. This would definitely put strain on the costs. Moreover, they are planning to get a larger aircraft. This will increase aircraft maintenance costs as they will have to service 2 different types of aircrafts. Also it is important that Ryanair focus on this route turn it profitable before they decide to expand to other routes. Growing too fast will increase costs further.

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Dogfight over Europe: Ryanair

Brushing up HBR fundamentals will provide a strong base for investigative reading. Often readers scan through the business case study without having a clear map in mind. This leads to unstructured learning process resulting in missed details and at worse wrong conclusions. Reading up the HBR fundamentals helps in sketching out business case study analysis and solution roadmap even before you start reading the case study. It also provides starting ideas as fundamentals often provide insight into some of the aspects that may not be covered in the business case study itself. Begin slowly - underline the details and sketch out the business case study description map. In some cases you will able to find the central problem in the beginning itself while in others it may be in the end in form of questions.

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