Case summary:
Airlines Company G uses low cost approach. The new version of this airlines is Airlines JB. It is said to be the 2nd largest company in Country B by both fleet size and market size. The tickets were sold at discount, easy payment services were offered, and customer were interacted through internet. The low cost approach and the business model allowed company to grow faster with good profits and 22% market share in Country B.
Airlines Company G wants to enter into Country U market with low cost approach and succeed in that market too. This company started a program called “smile lounge” and expanded its business year by year. The company mainly focused on specific set of airports and cities. Company G finally achieved its goals and now operating in 55 destinations with 600 flights daily. This company has got strong market position with good profits.
Characters in case:
Company G
Country U
Country B
To determine: Whether the low cost is a commodity service that is easy for competing with other airlines or its business model that is hard to copy and whether the Airline A or Airline D compete on basic of lower cost option or in offering higher services.
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Chapter IC Solutions
International Business: Competing in the Global Marketplace
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