Singapore Institute of Management (SIM)
Bachelor of Applied Science (Aviation)
AVIATION STRATEGY IN THE GLOBAL CONTEXT (AERO2492)
Individual Assignment 1:
An external environment
assessment of an aviation business
Date of Submission: 2 September 2018
Name
Student ID
Tan Jun Jie
S3647853
Table of Content
Executive Summary 3
Introduction 4
Background 4
Airline industry 4
Current Problems 5
Operating Environment 6
Political 6
Economical 6
Social 6
Technological 7
Legal 7
Environmental 7
Current Strategies 8
SWOT Analysis 8
Strategic Recommendations 9
Conclusion 11
References 12
Appendices 13
Executive Summary
The performance of the airline industry is not entirely smooth sailing, there are several adversities which airlines must overcome to remain profitable. Economic downturn, high fuel prices, cyclicality of market and other factors such as terrorist attacks are some external factors which could hinder an airline’s profitability. In such a challenging environment full of uncertainties, it is essential for airlines to identify future growth opportunities and eradicate all potential threats from the macroeconomic environment in which they are operating. All of this is made possible through conducting an external environment analysis as known as PESTLE analysis. Thereafter, a SWOT analysis is used to help formulate recommended strategies to allow for the sustainable operations of the organization.
1. Introduction
1.1 Background
Singapore Airlines Limited (SIA) is the flagship carrier of Singapore. It was officially established on 28 January 1972. Being the parent company to multiple of its airline-related subsidiaries such as SilkAir, Scoot, Singapore Airlines Cargo, Singapore Airline Engineering Company and Vistara, SIA operates as a full-service network carrier (FSNC) which serves a wide range of products and services to its customers. To date, Singapore airlines operates a total fleet of 122 wide-body aircrafts entailing a composition of both Airbus and Boeing aircraft types. SIA has since transcended in its operations from being a regional carrier to a world class travel brand.
1.2 Airline Industry
In this modern day and age, the airline industry has become an intensely competitive one. The increased expansion of low cow cost carriers (LCCs) and the fierce growth of Middle Eastern carriers has caused an upheaval to many global airlines recently. In hindsight, it is consequential for an airline to reinforce its position in the market by adopting the best strategies to gain a competitive advantage over its rivals. Improving customer experience and being cost-effective are just some approaches in which airlines utilize to remain at the top of the game.
The basis of this report aims to access the external environment of Singapore Airlines through the usage of the PESTLE analysis which examine the political, economic, social, technological, environmental and legal factors which directly affects the organization. Through the findings of the PES...
