Read the “Delta Air Lines (A)” case in attach then,
Answer the questions listed below. Submit your answers in a double-spaced Word document, clearly separating out each question and answer.
- Why have most airline firms not been able to achieve profitability? (Hint: Do an industry analysis to show how industry structure has impacted profitability in the airline industry, you have to use Porter’s five 5 forces Model as a Graph and explain it in Paragraph each force separately).
- Why did the major legacy airlines like Delta and Continental not do well but low-cost airlines like Southwest and JetBlue did well in the same industry environment? (Hint – How did differences in the strategies and value chain activities of legacy airlines and low-cost airlines contribute to differences in competitive advantage and performance?).
- Why have legacy airlines not been able to imitate the success of their low-cost competitors? Even when legacy airlines like Delta launched low-cost subsidiaries like Delta Express, such strategies have failed. Why?
- Mark Balloun’s team at Delta is considering four strategic options (these are listed in the case). Which option would be the most effective strategy for Delta? Justify your answer.