Rivalry from Competitors

Attractiveness

Sr. No. 1 2 3 4 5

No. of
Large Small
Competitors

Industry Growth  Slow Fast

No. of Competitors
- By 2000, US had :
National Airlines (37)
Regional Airlines (46)
But only 9 major Airlines had majority market share.
 Rivalry from Competitors
Attractiveness

Fixed Cost
Sr. No. 1 2 3 4 5 - Airframes, Aircraft Engines, Aircraft Parts,
Flight Equipment, Insurance, Hangar rental,
Taxes, Crewmember salaries if they are
Fixed Cost High Low paid on a yearly basis.

Differentiation Low High

Differentiation
-Differentiation in the airline industry was
Switching cost Low High
low. Pricing was competitive and services
provided were similar.

Switching cost
-Switching cost is relative to 2 factors:
1. Frequent flyer
2. Non-frequent flyer