Question #3 Compare and contrast the different strategic approaches of the network and budget airlines. What are the strengths and weaknesses of each approach?
Network airlines strategic approaches:
The network airlines have used a couple of successful strategic approaches over the last couple of years. This includes using a "hub and spoke" system. This means that the network airlines route their flights through major hubs, usually dominating hubs in major cities around the world.
The network airlines do suffer from a couple different weaknesses in their strategic approaches, such as they have a higher cost structure due to unionized work forces and superior in-flight services and high gas prices have generated higher operating costs, which raises the prices for their customers.
Budget airlines strategic approaches:
Some positive, succesful strategic approaches that budget airlines have used are they hire nonunion workers and corss-train employees to perform multiple jobs. This cuts the amount of people budget airlines need to support and fly an aircraft. They also use cheaper secondary airports rather than major hubs and they offer no in-flight food or complementary dirnks. All of these factors help cut operating costs to keep their ticket prices down for their customers.
A weakness for the budget airlines may be exactly what their cost-reducing tactics are. For example, no in-flight food or drinks, not operating out of many major airports, and they offer no other plane then the Boeing 737. This may be a turn off for some consumers who are looking for luxery and convience and are willing to go to network airlines and pay higher prices for them.
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Plane Wreck - Question #4 -Lindsy Girard
What is required for the industry to return to profitability?
Budget Airlines are the key to profitability. They don't have all the perks of most big planes that leave out of big airports like Logan but they are cheaper because they leave from smaller airports, they don't have meals, they higher nonunion people, they buy one type of airline and many more reasons.
I just came back from a flight this weekend and my flight was cheap because it left out of manchester, nh, it was a small plane that didn't have meals and it wasn't a long flight.
Some flights are more expensive but the less expensive planes fill up more than the more expensive flights.
To get back profitability as i said before the airports should use more of the budget airlines to save money by buying small planes and less elements for the plane to run and to get more money because their flights are cheap more people will buy tickets for their airlines.
Question #2
The major network airline and budget airlines are definitally on a diffrent strategic network because the major networks are on a hub and spoke system and they tend to try to serve more customers and make diffrent locations for multipul flights. Where the budget airlines are on a point to point system and they don't have any of the thrills of free food, drinks ect and all they are worried about are the cost to cut for the customers.
Question #5
The major network of airline must begin to cut costs inorder to compete with the bargin airlines although they are delivering more of a service they are not doing everything they can inorder to cut the costs which is the most important to the customers at this time. Although they began to cut costs in 2001 and 2004 they still are no where near where the budget airlines are. This is going to cost them some of their customers yet they don't want to cut prices to much that they go bankrupt.
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