XxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxLectureXxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx25th July, 2012. Question one: Changes occurring in the airline industry and how Qantas is responding to the changes The airline industry in Australia as well as industries other all over the globe is going through a period of idealistic change. In these sense basic restructuring is ongoing in the industry, the major changes in the industry are linked to aspects such as the shrinkage of the high end demand in relation to air travel, surfacing of a new cadre of low cost carriers and amplified simplicity of substitute airline offering and the existence of less classy itineries which is mainly due to the internet in combination with other emerging technologies (Quiggin 1997). The instantaneous crumpling of the of high end demand which took place by the end of the year 2000 is seen as a major structural change and it was mainly due to a combination of the technology and economics.
Leisure traveler used to select the airlines to travel with based on the price been charged, the business travelers have also joined them and they have become more price sensitive.
The change in price sensitivity of the business traveler is seen as a permament change that has occurred in the industry. The change in price sensitivity and the economic downturn which occurred at the latter half of the year 2000, there have been radical changes in the travel purchasing habits. Slashing of the costs related to business travel is viewed as a major change and also been among the corporate individuals first priority and they are using the low cost carriers in instances when they have to make a business trip.
Another aspect is that most organizations are minimizing the number of trips they used to make in the course of a business transaction, this is mainly due to the fact that the organizations are more concerned about the price been charged and also due to the emergence of technology they are able to exchange documents using online means. Almost all business have made the above changes in their travel patterns, most of them have substituted the travel with web conferencing and other related technologies such as face to face meetings.
Qantas have tried to respond to this change by lowering the cost of the business travelers while at the same time ensuring that they remain competitive. Another change is attributed to the emergence of lost cost carriers in Australia, such as air Asia, Jet star, pacific blue and tiger airways just to mention a few. in the past, flying on a low cost carrier predestined sporadic service and the travelers usually used aging airlines, at present LCCs now offer expedient schedules, state of art aircraft and facilities that meet or at times exceed those been offered by the full service airlines.
Qantas has responded to this change by coming up with some low cost carriers operating under their name. An example of such an airline is jet star Hong Kong. With the addition of low cost carriers in their airline categories, they will be able to attract new customers and retain new ones who are willing to use the low cost carriers. They have also responded to these changes by ensuring that their low cost carriers offer the best services as compared to low cost carriers from other airlines.