1. Executive summary
In the European airline industry, the low cost carriers have been so profitable that they have been looking to expand. Ryanair has become the Europe's No.1 low fare airline company. In this report, with the aid of Porter's PEST model the group analyse the environment influences on aviation industry. As part of political factors of PEST, 9/11 has raised opportunities for Ryanair to expand their market share. Then we will attempt to explore how Ryanair keeps their sustainable competitiveness with the D'Aveni's concepts of hypercompetition. We also adopt the value chain analysis to understand how the different activities of the low-cost airlines (Ryanair) add their value compared with national airlines (British Airway and Aer Lingus). On the base of the value chain analysis the core competencies are highlighted. At last the group will give some recommendations on the improvement of service quality and the enlargement of the target customer groups for Ryanair.
Since the terrorist attacks of September 11th 2001 along with economic slowdown, the Iraq war and SARS, the aviation industry has suffered a deep slump, particularly in flag airlines. Yet it raises opportunities for the low-fare carrier segment, such as Ryanair that is a rising star in the skies of Europe, having been performing well post 9/11. The aim of this report is to analyse the overall performance of Ryanair in the fast-changing environment, and then few recommendations will be provided. Conclusions will be drawn at the end of this report.
3. Description of Ryanair
Irish-owned Ryanair, founded in 1985, began to introduce a low cost operating model in the early 1990s. The company primarily serve short-haul, point-to-point routes that target business commuters and leisure travellers by offering low, multi-tier fare pricing and sngle-classs air transportation. Having overtaken EasyJet, Ryanair is now the...