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Explanations

Picture 1

2001 Malaysia AirLines System (MAS) had dominated the domestic market.

Price offer by Mas was high and it became a problem to customer which is not affordable.

Air Asia had come out with Low-cost carries (LCCs) that offer custom at lower price which saving up to 60%.

AirAsia company tagline now everyone can fly truly reflect the companys promise to it customers.

Started the company with 2 old Boeing 737s serving the domestic market in Malaysia.

Picture 2

Tony Fernandes as CEO of AirAsia company.

He had created first airlines in Asia to introduce the budget , no- frills airlines concept.

Has 3 partner of AirAsia company there were Tune Asia Sdn.Bhd, bought the fledgling AirAsia, a Malaysia government linked airline.

AirAsia launched on 2001 where are at the time people feel hesistant to travel due to the aftermath of the 2001 terrorist attack. But at that time people started to look for holiday in nearby country.

Picture 3

Strategy used by Tony Fernandes :

Even in 2001 people was in dilemma at the same time Asia were enjoying the benefit of rising incomes and good economic growth but they were not afford for long distance holidays.

With AirAsia still go holidays and travelling to nearby country such as Singapura, Indonesia and especially in Malaysia.

Tony Fernandes often seen working alongside his team as a crew member that can allow him to know his staff better and to listen also get feedback from customer.

He also ensure that he is accessible to all his staff by giving them his mobile telephone number.

Technology improved toward company like online booking and travelers without credit card can pay by cash at Alliance Bank Branch in Malaysia.

Facing the regulation with he engaged the support of the former Prime Minister of Malaysia at that time Tun Dr. Mahathir Mohamad, to network with neighboring countries is an effort to develop an open-skies agreement. Since then other country have granted landing right to AirAsia.

Picture 4

AirAsia have been the best service for customer in Malaysia to travel.

AirAsia has evolved from an ailing company into one that netted a profit of $14.4 million by its third year of operation

Question

1) What are the macro environmental factor that have contributed to the early success of AirAsia?

Economic Environment

Technology Environment

Political Environment

Cultural Environment( peoples view of organization)

2) By focusing on low prices, has AirAsia pursued the best strategy? Why or why not?

Air asia focusing the low prices as their strategy because Asia economic was In good condition growth and rising income. Since MAS offer higher prices to customer to travel, Air asia come with low prices that can full filled the need of customer. Because most of them are not affordable to pay large amount on traveling service. Air Asia offer low price and budget for whom want to go traveling around nearby country.