AIRBLUE PAKISTAN

INTRODUCTION Air blue is a private Pakistani airline based at Jinnah International Airport Karachi. It started its operations on May 24, 2004. It was the first private carrier of Pakistan to operate the Airbus A320 when it initially started. Air blue has been expanding rapidly despite experiencing competition from the other three airline operators in Pakistan. The airline mainly flies on domestic routes plus internationally to Dubai International Airport and also has plans to fly to the Gulf, UK, and USA. MISSION STATEMENT: Air blue will be recognized as the most progressive enterprise in the transportation business. We will offer our customers cost effective transportation service within geographical areas and market segments that can benefit from our services and will insure a return on investment and growth rate consistent with current management guidelines. VISION STATEMENT: Our vision is to make Air blue the most admired airline in the world. * Ensuring safety comes first * Providing Service * Encouraging product leadership * Delivering superior financial returns * providing rewarding career opportunities SWOT ANALYSIS of AIR BLUE: The SWOT analysis is the process of analyzing organizations and their environments based on their strengths, weaknesses, opportunities and threats. This includes the environmental analysis, the process of scanning the business environment for threats and opportunities, which is considered as external factors, and the organizational analysis, the process of analyzing a firms strengths and weaknesses as internal factors. SWOT analysis was carried out for Air Blue and the results are summarized as follows:

Strengths: 1. Second largest air-carrier of Pakistan, enjoying almost 30 percent market share on domestic routes. 2. Air blue is a Low-cost carrier (LCC). The reason behind air blues low fares is that it uses Dynamic Pricing Model. Air blue puts its entire... 3. Leading Market Position 4. Brand Recognition 5. Superior Operating Structure 6. Network Presence 7.Hub airport at Karachi Airblue puts its entire ticket inventory on the Net and direct internet booking accounts for 15% of its sales. It begins selling tickets at a 40% discount to full service carriers (FSCs), but closer tothe date of your travel, you may end up paying up to 30% premium over theprice charged by FSCs. 98% punctuality of on-time flight departures. Innovative e-ticketing and wireless check-in technologies. Operational efficiency. Airblue is using latest technology for the airline's advantage and its valued customers. Many corporate entities tried to create a paperless work environment, in order to minimize its costs and maximize its efficiency, but only Airblue had been successful to the extent that its management does not need offices to function.7. The airblue aircraft are the latest fly-by-wire technology Airbus A320's andA321's. This allows the airline more flexibility and scales of economy in crew planning and maintenance capability, adding directly to bottom-line profitability. Lesser workforce because of extensive technology usage. AirBlue is the first among public and private sector airlines in South-Asia and second after Emirates in the region to introduce latest self check-in system atKarachi airport. The self check-in system will facilitate the passengers carrying baggage with them, to get boarding card through the new touch screen system without reporting at the counter. Package for students and special children. Good food, good entertainment, spacious seats, most exciting hospitality, elegant and charming hostesses.

Year 2006 witnessed exceptional performance in the short term financing which was reduced from Rs 206 million to Rs 48 million, showing a decrease of 330 percent. Airblue showed a record operating profit of over Rs 150 million for year 2006while providing a high quality product to the consumers. Airblue outsources most of its secondary tasks to third parties. It helps airline to cut costs. Weaknesses: (1. Route and fleet expansion 2. Growing demand for Low cost airlines 3. Expansion of Freight Business 4. Customer loyalty 5. Shifting customer needs 6. Further Alliances 7. Industry Recovery) 1. Difficulty in developing brand-awareness as a startup company. 2. Engaged only in passenger service, whereas its competitor PIA is also providing cargo services (SPEEDEX). 3. Not having its own repair and maintenance facilities. 4. Doing less on the advertising and promotion of air line. 5. Not operating flights for Hajj Pilgrims, which could be a major source of income. 6. Small fleet of air crafts. 7. Two aircrafts are acquired on dry lease and one on wet lease.8. 8. It connects only seven cities in Pakistan.9. 9. Very tight schedule of flights, which puts extra burden on pilots, cabin crewand hostesses Opportunities: (1. High dependence on Passenger Revenues2. Debt3. Reliance on Oil Prices) 1. Year 2007 is being celebrated as Visit Pakistan Year. So, the number of foreign visitors is likely to increase and complimentary tourism industry willincrease demand for airline service. 2. Agreement with Airbus Industries for the purchase of eight airbus A320-200and two airbus A330-200 aircrafts for an estimated cost of $ 790 million. Newaircrafts will be used for additional frequencies and destinations on domesticand regional routes. 3. Low fares enable market share growth. 4. Introducing new domestic and international routes like Gulf, UK, Jordan, Indi

Stable economy and growing GDP. 5. The air transport sector of Pakistan would also get a boost from newlydeveloped Port of Gwadar in the Balochistan province. The development of the Gwadar Port, the third deep sea port of the country and the first of Balochistan, would serve as a link with the Central Asian States. Thegovernment is upgrading the Gwadar International Airport at a cost of 480million rupees. Once upgraded, the airport will be able to handle wide-bodyaircraft such as Airbus and Boeing 747 aircraft. 6. Poor performance & red tapism in PIA. 7. Worldwide deregulation makes the skies more accessible, Open Skies.9. 8. Excellent credit rating allows Air Blue to purchase its expansion strategy. Threats 1. Escalating jet fuel prices. 2. Low cost Chinese airlines planning to enter into Pakistans domestic air market. 3. Cutthroat price war among airlines.4. 4. Buses business continuously improving speed in service in mid and longdistant routes, attracting passengers away from air service.5. 5. PIA is also procuring 10 new Boeing planes.6. 6. Threat of terrorism.7. 7. No level-playing field for private airlines, as government always rescues PIAfrom risks.8. 8. Incapability of national airport runways to handle big crafts.9. 9. Competition is heating up as four new local airlines are going to start theiroperations very soon.10. 10. High insurance costs for aircrafts and passengers. Threats 1. High Interest Rates2. Accidents3. Strong Competition 4. Interest and foreign currency exchange rates5. Decline in airline industry. 2. During the first year the airline became very popular, which allowed the airline to compete directly with the flag carrier Pakistan International Airlines and the two other private carriers, flying more than 400,000 passengers in the first year with

a load factor of over 90%.This allowed the airline to expand into more cities in Pakistan including Peshawar, Quetta and Nawabshah. On 14th August 2005 (Pakistan's 58th Independence Day) Airblue launched its first international flight from Karachi to Dubai. On June 4, 2007, Airblue launched its inaugural flight to Manchester, England using the Airbus A321. 3. As of June 2012, Airblue has finalized an agreement to acquire one Airbus A320 and two leased Airbus A340-300s for current and new international routes. It is also looking at various types of turboprop aircraft for new domestic routes. If finalized, Airblue would be looking to acquire four turboprops. The A320 would provide further flexibility in the schedule while the A340s would enable it to strengthen its Manchester route. This would also help the airline to open more routes in Europe and the Middle East. Airblue plans to be operating a total of ten aircraft by the end of 2012. Comments AirBlue has performed very well so far. It has tried to build strategy on genuine understanding of the customers true needs. It identified key customer satisfaction drivers, and then turned into a foundation to shape company development strategies and innovations. The objective is to realize the quality-strategyintegration.1. AirBlue should adopt an aggressive marketing strategy to promote airblue as acustomerdriven airline.2. It should continue to be innovative in introducing latest technologies to reduce its costs and enhance customers ease, satisfaction and its profits as well. Currently, its only the national flag carrier PIA which operates frequent flights during Hajj season. Airblue can make a huge dent on PIAs profits if its able to capture some share of Hajj pilgrims.4. AirBlue is doing well against PIA, but it should adopt proactive strategies to compete with Chinese airlines.5. There is a huge potential in domestic market because its operating flights for only seven cities. So, airblue should expand its network. During the first year the airline became very popular, which allowed the airline to compete directly with the flag carrier Pakistan International Airlines and the two other private carriers, flying more than 400,000 passengers in the first year with a load factor of over 90%.This allowed the airline to expand into more cities in Pakistan including Peshawar, Quetta and Nawabshah. On 14th August 2005 (Pakistan's 58th Independence Day) Airblue launched its first international flight from Karachi to Dubai. On June 4, 2007, Airblue launched its inaugural flight to Manchester, England using the Airbus A321.

As of June 2012, Airblue has finalized an agreement to acquire one Airbus A320 and two leased Airbus A340-300s for current and new international routes. It is also looking at various types of turboprop aircraft for new domestic routes. If finalized, Airblue would be looking to acquire four turboprops. The A320 would provide further flexibility in the schedule while the A340s would enable it to strengthen its Manchester route. This would also help the airline to open more routes in Europe and the Middle East. Airblue plans to be operating a total of ten aircraft by the end of 2012.[8] Destinations: Airblue serves the following destinations (at June 2012). Oman Muscat - Muscat International Airport Pakistan Islamabad - Benazir Bhutto International Airport Focus City Karachi - Jinnah International Airport Hub Lahore - Allama Iqbal International Airport Focus City Peshawar - Bacha Khan International Airport Turkey Istanbul - Sabiha Gokcen International Airport [9] United Arab Emirates Abu Dhabi - Abu Dhabi International Airport Dubai - Dubai International Airport Sharjah - Sharjah International Airport United Kingdom Manchester - Manchester Airport Airblue also previously served Faisalabad, Gwadar, Nawabshah and Quetta in Pakistan. Network expansion Airblue intend to expand operations with additional aircraft to destinations in Europe, Middle East and China aiming to become a major player in Europe. They also plan to

start a Mumbai-Karachi air route. However, this would require the airline to get designated, a status which only PIA enjoys currently. Under the bilateral civil aviation agreement, there are slots for 12 flights a week between India and Pakistan, currently entirely used by PIA. Services Cabin Airblue currently operates a mixture of Airbus A320 and A319s. All aircraft are in a 3 by 3 all economy layout. There are several overhead screens located after several rows. The airline dropped its Business class section due to exogenous economic factors. The layout was 2 by 2 with inflight televisions and leather seating and the cockpit of the airblue planes are all digital. e-Ticketing Karachi is the hub for most of Airblue's domestic operations Airblue was the first airline in Pakistan to introduce e-ticketing, wireless check-in and self check-in kiosk facilities. The airline also became a member of Sabre system that is used by over a hundred airlines to help it with ticket automation service. Frequent flyer program The Airblue frequent flyer program is called Blue Miles. Passengers are able to initially start on the base level where sign up is free. Once passengers earn enough miles, there are upgrades to the Blue Card followed by the Platinum Card. In May 2009, the airline formed an alliance with The Faysal Bank Limited (FBL) to launch its summer promotion on its credit cards. Lounges Airblue inaugurated its own premium lounge at Jinnah International Airport, Karachi in November 2008. Nicknamed, the Blue Lounge International, it was designed for business class passengers, credit card holders and privileged customers. The lounge offers a number of Internet facilities, cable television, newspapers and magazines, massage chairs as well as a snack bar. It is located in the international terminal of the airport. Not operational anymore. Cost-cutting measures To deal with the fuel price hike worldwide, Airblue converted their fleet to all economy class. This will also be applied to their new aircraft. They also ended full meal services and replaced it with snacks on domestic flights. In 2006 Airblue did away with chinaware crockery service for meals on domestic and possibly Gulf routes to cut costs and weight, replacing it with plasticware as per normal industry practice. Dnata handles the majority of Airblue's ground services within Pakistan as well at most of its oversea operations Ground services Passengers may check-in between two to 48 hours prior to flight departure. This may be done over the counter or at the self-service kiosks. Currently self service kiosks are available at Jinnah International Airport and Allama Iqbal International

Airport. Dnata the aviation services company handles the ground and passenger handling for the airline at all of the airports the airline operates from. Gate Gourmet provides food and beverage services to the airline. Cargo operations Airblue have launched e-Cargo service to cater to air freight markets of Pakistan, UAE and UK. According to a press release, e-Cargo will broaden the base of cargo and permit certified agents to book freight directly online opening the inventory through Web. Airblue has integrated unique innovations to ensure security and affordability. Among these are complete online reservation systems, online reservation hold/in person payment at various locations, and mobile airport check in procedures. Airblue besides its innovative eticketing has also achieved following recognition. First airline in Pakistan to start e-ticketing. First airline in Pakistan and only the third carrier in the region after Emirates and Royal Jordanian to introduce self-service check-in facilities. First private airline in Pakistan to initiate long-haul services on (Islamabad-Manchester) sector. Airblue makes a fuel stop at Trabzon in Turkey when flying to and from Manchester. This route is the longest route operated by an Airbus A321 aircraft in the world, and the longest scheduled route operated by an Airbus narrow-body aircraft (excluding the Airbus A319LR). Airblue & on Air deal On Air has announced an agreement with Airblue, Pakistans fastest growing airline, to launch Mobile On Air voice and data services on up to 12 of its Airbus A320 aircraft beginning in 2009. Frequent Flyer Program Airblue frequent flyer program is called Blue Miles. Passengers can sign up is free on the web site of airblue. Once passenger earn enough miles, they are upgrades to the Blue Card followed by the Platinum Card. In May 2009, the airline formed an alliance with The Royal Bank of Scotland Limited (RBS) to launch its summer promotion on its credit cards renaming them "RBS Airblue Card" Airblue Lounges Airblue made its own premium lounge at Jinnah International Airport Karachi in November 2008. They called it the Blue Lounge International, it was designed for business class passengers, RBS credit card holders and privileged customers. The lounge is located in the international area of the Karachi airport.

Joint venture with JS Air To comply with Civil Aviation Authority (CAA) regulations the airline started operating on socio-economic routes by flying to Nawabshah (Banazirabad) however the service was soon suspended. The suspension meant that Airblue was not compliant with CAA regulations and therefore had to incur penalty fees. To overcome the issue of non-compliance Airblue entered into a joint venture with startup charter airline JS Air to operate flights on its behalf on socio-economic routes. This represented the first time in Pakistani aviation history that 2 air operators entered into a joint venture arrangement. The first destination under this agreement was the port city of Gwadar which was connected to the Airblue network on 17 June and was served twice daily, except Fridays, from Karachi. The flights were operated using JS Air's 19 seater Beech 1900C aircraft which are specifically suited to serving low yield 'commuter' destinations. This service was also suspended in 2007 due to insufficient demand.

Travel Agents Fees As per the decision of Travel Agents Association, Travel & Culture will charge Transaction Fee of Rs. 350 per ticket on domestic Economy Class, Rs 500 per ticket on domestic Business Class this applies to Airblue and other domestic airline bookings. Airblue Domestic Routes: Karachi-Islamabad Karachi-Lahore Karachi - Peshawar Airblue International Routes: Karachi to Dubai Lahore to Dubai Islamabad to Dubai Peshawar to Dubai Islamabad to Manchester Islamabad to Istanbul Lahore to Istanbul Islamabad to Muscat Lahore to Mascat Islamabad to Abu Dhabi Lahore to Abu Dhabi Peshwar to Abu Dhabi