Oasis Hong Kong Steep

Threat of new entrants-

High threat (hard to get into the industry):

The threat of a new entrant in this field would be difficult. I feel that people are very loyal to their favorite airline carrier, especially now that reward programs help them achieve free flights. There would have to be a competitive advantage such as low cost no frills all direct flights only. Also the cost of a plane in itself is a lot of money to invest in, and there would have to be good market research and business plan to meet your break even point.

Rivalry Among Competing Firms

High Threat (lots of rivalry):

The airline industry has a lot of competition, especially with prices and the harder economic times. They have to make a profit and meet there break even point, but at the same time they need to provide a reasonable price of ticket to the consumer. There is rivalry among the low cost carriers that offer low budget, no frills services such as Jet Blue and Frontier try to secure low but competitive costs to consumers. The traditional carriers would include a more expensive ticket that includes items such as in flight meals, wider seats, personal TV’s and lounges in airports. After the 911 terrorist attacks Southwest was the only airline that made a profit. Competitors in this industry are also at the mercy of supply and demand with fuel prices.

Threat of substitute products- Low-Med (easy to find other means of transportation):

Cars are the biggest threat, especially since 911 people have opted to drive. Some people will compare the price of driving to the cost of a plane ticket to help them decide on there transportation. Another substitute product is a train, especially in Europe and major cities connecting other major cities in the United States. Another type of substitute instead of vacations and flying somewhere, people are having “staycations” and staying at their homes with there families.

Bargaining power of buyers- Med- High threat:

There are a couple...