The Major Players and their Strategies
Virgin Atlantic is an independent airline, which is operational on almost all major routes in the world. Some of the competitors include British Airways, Continental, Delta and United when it comes to flying over the transatlantic routes. Over South African skies, the competition is in the form of British Airways and SAA, whereas it is JAL, Singapore Airlines, Cathay Pacific and British Airways over the Far East. Airline industry being one of those where profitability has been decreasing over the years is seeing the major players trying their best to come up on top.
A common strategy that is adopted by almost all the major players who are a competition to Virgin Atlantic is to try and increase the total utilization rate, at the same time there is an attempt to bring down the breakeven utilization rate. All these players have been trying to achieve quick turnaround times, which is essential factor in defining profitability when it comes to airline operations. The players who are direct competition to Virgin Atlantic have also been developing strategies specific to their own businesses.
For example, consider how British Airways reframed its strategy for its subsidiary airline OpenSkies, bringing, targeting the business class travelers. They have also been taking measures to improve and map customer satisfaction levels. Another major player is Continental Airlines, who have decided to turn to Information Technology to have systems in place to improve customer, which it hopes would gel well with its other strategies.
It has introduced new routes and has kept the prices steady as far as possible. Their idea is to keep the loyal customers under their fold while trying to attract new profitable customers. Airlines have also been trying to expand their markets by making use of the strategy of acquisitions or mergers with other players. For example, in 2008 Delta Airline’s decision to merge with Northwest Airlines made them the world’s largest carrier in terms of passenger traffic.
This kind of expansion is possible only through mergers or acquisitions. Another avenue for competition has been in form of the regional no frills airlines. Their policies are straight forward and the rates low. Even though they don’t offer much in terms of flying comfort, they make up for it through the affordability of flying that they offer to the customers. Southwest Airlines, JetBlue, Ryan Air are few of the no frills, low budget airlines that operate from different parts of the country.