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Etihad Airways - Case Study Example
Based in Abu Dhabi, Etihad Airways was established in 2003 and is the flag carrier of Abu Dhabi, United Arab Emirates (Etihad Airways). It operates services to the Middle East, Europe, Indian Subcontinent, North America, Far East, Africa, Central Asia and Oceania (Etihad Airways)…
His major aims were to increase the profitability and the yield by 2010. In order to satisfy this condition, James came up with a second bag charge to be imposed on the customers. The case also gives out certain aspects of the future plan of the airline. The airline has placed an order for 205 aircrafts for $43 billion. This will increase the fleet size to 100 in 5 years. This move will generate more revenue as the capacity of the airline will increase. The case says that Etihad Airlines gives much importance to customer value. They have a loyalty program for their customers which is called Etihad Guest. It includes features like, immediate rewards, no black-out periods, anytime availability, widest choice, miles plus cash, miles that are worth more and family membership. They had high end redemption awards. The case further says that the Indian market shows much stronger signs of improvement. Given, the current scenario, a passenger seat load factor of 76-77 percent is being expected.
The Etihad Airlines is under a major issue of profitability and yield. James was hired to take the airline to profits by the year 2010. However, the chances seem to be slim. The International Air Transport Association has showed concern and has estimated that the global aviation industry will show a global net loss of $5.6 billion in the year 2010.
To face the problem, James has ann ...