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Background of Emirates Airlines

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The government of Dubai established Emirates Airline in 1985 to develop the tourism and infrastructure of the United Arabian Emirates. It is the largest air company in the Middle East, which performs 2500 flights every week to 122 cities in 74 countries on the six continents. The company also realizes 4 from 19 the longest flights in the world without landing. They are from Dubai to Los-Angeles, San Francisco, Dallas, and Huston. Emirate Airline is a part of the Emirates Group Corporation, which has more than 50000 workers and is in Dubai government property. The company is the second largest in the world regarding its revenue.

Emirates operate a mixed fleet of Airbus and Boeing wide-body aircraft, but the basic is Boeing 777. It is one of the first clients of Airbus and the first costumer by the quantity of orders. The company is famous because it buys the large amount of planes constantly. For example, in 2007, it bought 130 new planes. The first flights were to Mumbai, New Daily, and Karachi. The Emirates Airline has been making flights to Europe only since 1987 and to the Far East since 1990. This fact enabled the passengers to have a change in the Dubai airport to fly to the Far East, Australia, and New Zealand. The interesting fact is that the passengers can use mobile phones on the board of planes during the flight.

Air Transport World awarded Emirates Airline with the title of “The Best Air Company of the 2011 Year”. This award was given for the safe, exclusive operations, highest standards of passenger service and flawless financial results (The Emirates Story, 2015).

Identifying Problem and Issues

Emirates Airline as every air company had some incidents which caused problems for the company. It had to discover the reasons and causes of its failures. The fact that the company could save the clients confidents means that it did all its best to search the roots of problems. If the Emirates Airline plane has an accident, the company will help victims and their relatives. They will discover technical part of the fails to avoid them in the future. Another argument is that after the crash of Russian Airbus near Egypt, Emirates Airline canceled its flight above this territory. This company is ready to lose some money, but save the passengers’ lives. It is a very important thing (Airline Incidents for airline Emirates, 2015).

Industry Analysis (5 Force Analysis)

The Threat of the Entry of New Competitors

The new entrants in the market will meet many barriers that discourage them. As Emirates Airline is a national government company, it has some benefits. The company is very popular with a long successful history that helps people to feel safe on the boards of its planes. Emirates Airline has a big plus to be a member of the Emirates Group having access to a large pool pf capital. The company has well-developed customer loyalty programs. Another benefit of Emirates Airline is that it a leader in this industry with good finance indexes that satisfies the needs of clients including long flights without landing and a large variety of flights destinations (Emirates - Porter's 5, 2015).

The Bargaining Power of Customers

Emirates Airline provides very good service for its costumers such as different tickets as well as budget and luxury prices for the same flights. The number of the buyers flying to India is one of the highest. The company offers a great choice of delicious meals in menu for the passengers and private terminal. Speaking about menu, it is considerable to say that Emirates Airline has its own flight kitchen preparing the food. Everybody can buy a ticket on any flight anywhere. The company has non-stop system of selling tickets. The planes are comfortable and safe (Emirates - Porter's 5, 2015).

The Intensity of Competitive Rivalry

The intensity of competitive rivalry is very high and strained because 37 airlines fly from and to Dubai. It is a large amount. The competitors are both international and domestic. The benefit of Emirate Airline in that the company is governmental. The air industry is growing in the Middle East. For the last decade, this index has grown at 11 per cent. There are many advertisements of flights in the region. As this company has an excellent reputation, it does not need any support. It is very hard for the competitors to outrun Emirates Airline (Emirates - Porter's 5, 2015).

The Threat of Substitute Products

Emirates Airline provides some flights for low prices and compensates this by luxury flights for high prices. It is a leader of luxury flights in the market. The company ensures good service before and during the flight. It provides food for the passengers, world-class private terminals, and comfortable hostels. The price of tickets is different for the same distance. It helps the clients to choose the suitable one (Emirates - Porter's 5, 2015).

Bargaining Power of Suppliers

The company has only 2 bargains, so the power of their supplies is very high. The suppliers will switch costs that suit them best. The United Arabian Emirates does not allow any unions of employees, so there are no problems with it. The supplier concentration to firm concentration ratio is very high (Emirates - Porter's 5, 2015).

SWOT Analysis

Strengths

1. Governmental company;
2. more than 50000 employees;
3. 2500 flights every week to 122 cities, which are in 74 countries on the six continents;
4. 4 from 19 the longest flights without landing;
5. different prices for the same distance;
6. well-developed customer system of loyalty;
7. non-stop system of selling tickets;
8. a flight kitchen that provides food for the passengers.

Weaknesses

1. Strong competition demand high costs to support the standards;
2. Technical problems with the planes.

Opportunities

1. Improving more flights to different places in the world which is clients’ needs;
2. improving the customers confidents.

Threats

1. The growing competition in the Middle East market;
2. Fuel cost can increase (The Emirates Story, 2015).

Financial Analysis (Ratios)

The total revenue has grown from 20,170 million Euro to 22,134 million Euro since 2014. Operation income was 1,029 million Euro in 2014, but now this index is 1,748 million Euro. It has also grown. Speaking about operation cash flow, it has decreased. In 2014, it was 1,862 million Euro, but now this index is 1,64 million Euro. In general, many indexes become higher. It means that Emirates Airline has good financial data being economical profitable (International Consolidated Airlines Group SA, 2015).

Evaluation of the Performance of Emirates Airlines

The performance of Emirates Airline is effective both for the company and its clients. Besides, provides tickets for low costs, it compensates the expenses with the ones for luxury class. Emirates Airline has successful history and reputation that helps to be more confident in the future. The company has introduced high results for 30 years. It does all its best to provide modern and quality services for the customers. The company solves its problems with different issues. The clients have the opportunity to buy tickets according to their abilities 24 hours per day everywhere. They can travel with comfort and safety (International Consolidated Airlines Group SA, 2015).

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