“SCENARIO OF AIR ASIA”

Mini-Project submitted in partial fulfilment of the requirements of BBA

Degree in Management course of Bangalore University

By

MANASWINI SHARMA. B. G

Reg. No. 18MFC26023

Under the Guidance of

Aafaq Ahmed

Asst. Professor

Soundarya Institute of Management & Science

Soundarya Nagar, Sidedahalli, Nagsanadra Post

Banagalore – 73
 CERTIFICATE BY THE GUIDE

This is to certify that MANASWINI SHARMA. B. G (Reg. No: 18MFC26023) has

completed this Dissertation Project entitled “SCENARIO OF AIR ASIA”

This is an original and bonafide work carried out by the candidate under my guidance

and does not form a basis for the award of any other Degree/Diploma of any

University or Institution.

Place: Bangalore Aafaq Ahmad

Date: Asst. Professor

 DECLARATION

I, Anusha hereby declare that this research report entitled - “SCENARIO OF AIR

ASIA” conducted at Bangalore is an original and bonafide work carried out by me

in partial fulfillment of the requirement for the award of Bachelor of Business

Administration (Aviation) course of Bangalore University, under the guidance of

Asst. professor Aafaq Ahmed of Under Graduate Department of Business

Administration of Soundarya Institute of Management & Science.

I also declare that this project is the outcome of my own efforts and that it has not

been submitted to any other University or Institute for the award of any other degree.

Place: Bangalore MANASWINI SHARMA.B .G

Date: (Reg. No: 18MFC26023)

 ACKNOWLEDGEMENT

I wish to express my sincere thanks to Dr. SURESH HEGADE, Principal of

Soundarya Institute of Management & Science, for providing me with all the

necessary facilities.

I place on record, my sincere gratitude to Prof. GIRISH, HOD of Soundarya

Institute of Management & Science College for his kind co-operation in shaping this

research report.

I also thank my project guide Aafaq Ahmed Assit. Professor of Soundarya Institute

of Management & Science College for having guided me to outline the project and

grateful for her expert support and valuable guidance.

It is my foremost duty to thank my faculties, parents and friends for being the source

of inspiration and having rendered all the support that I needed.

Place: Bangalore MANASWINI SHARMA. B .G

Date: (Reg. No.18MFC26023)

 TABLE OF CONTENTS

Chapter Particulars Page No.

No.

1 Introduction 1-27

2 Research Design 28-39

3 Company Profile 40-64

4 Data Analysis and Interpretation 65-133

5 Findings, Recommendations &Conclusion 134-142

6 Bibliography 143-147

7 Annexure 148-157
 LIST OF TABLES

Table No Title of the table Pg.No

 LIST OF GRAPHS

Graph No. Title of the graph Pg. No

 SOUNDARYA INSTITUTE OF MANAGEMENT & SCIENCE

BANGALORE - 560073

PROJECT REVIEW REPORT

Name of the Student : Manaswini Sharma. B. G

University Register Number : 18MFC26023

Name of the Faculty Guide : Asst. Professor Aafaq Ahmed

Title of the Project : “Scenario of Air Asia”

Date of commencement of the project : 15th of November 2020

Date of completion of the project : 20th of January 2021

Sl.No Date Progress Signature of Signature of

the Student the Faculty

Guide

01

02

03

04

05

06

07

08

09

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12

Signature of Faculty Guide Signature of Director

 CHAPTER – 01

INTRODUCTION TO
AVIATION INDUSTRY
ETYMOLOGY

The term aviation, noun of action from stem of Latin aviso "bird" with suffixation meaning action
or progress, was coined in 1863 by French pioneer Guillaume Joseph Gabriel de La Landelle
(1812–1886) in "Aviation on Navigation aérienne sans balloons".

HISTORY

Aviation is the activities surrounding mechanical flights and the aircrafts

industry. Aircraft includes fixed wings and rotatory wing types, morphable wings, wing less
lifting bodies, as well as lighter-than-air craft such as hot air balloons and airships. The flying boats
were in their turn replaced by land planes, and the new and immensely powerful jet
engine revolutionised both air travel and military aviation. Aviation began in the 18th century with
the development of the hot air balloons, an apparatus capable of atmospheric displacement
through buoyancy. Some of the most significant advancements in aviation technology came with
the controlled gliding flying of Otto Lilienthal in 1896; then a large step in significance came with
the construction of the first powered airplane by the Wright brothers in the early 1900s.

Since that time, aviation has been technologically revolutionized by the introduction of the jet
which permitted a major form of transport throughout the world. The modern aeroplane with its
characteristic tail was established by 1909 and from then, the history of the aeroplane became tied
to the development of more and more powerful engines. The first great ships of the air were the
rigid balloons pioneered by Ferdinand von Zeppelin, which soon became synonymous with
airships and dominated long-distance flight until the 1930s, when large flying boats became
popular.
TOWER JUMPING

Since antiquity, there have been stories of men strapping bird like wings, stiffened cloaks or other
devices to themselves and attempting to fly, typically by jumping off a tower. The Greek legend
of Daedalus and Icarus is one of the earliest known; others originated from ancient Asia and the
European Middle Age. During this early period, the issues of lift, stability and control were not
understood, and most attempts ended in serious injury or death.

According to John Harding, Ibn Firnas' glider was the first attempt at heavier-than-air flight
in aviation history. In 11th century Benedictine monk Elmer of Malmsbury attached wings to his
hands and feet and flew a short distance, but broke both legs while landing, also having neglected
to make himself a tail. Many others made well-documented jumps in the following centuries. As
late as 1811, Albrecht Berblinger constructed an ornithopter and jumped into the Danube.

KITES

The kite may have been the first form of man-made aircraft. It was invented in China possibly as
far back as the 5th century BC by Mozi (Mo Di) and Lu Ban (Gongshu Ban). Later designs often
emulated flying insects, birds, and other beasts, both real and mythical.
Some were fitted with strings and whistles to make musical sounds while flying. Ancient and
medieval Chinese sources describe kites being used to measure distances, test the wind, lift men,
signal, and communicate and send messages. Kites spread from China around the world. After its
introduction into India, the kite further evolved into the fighter kite, where an abrasive line is used
to cut down other kites.
MAN-CARRYING KITES

Man-carrying kites are believed to have been used extensively in ancient China, for both civil and
military purposes and sometimes enforced as a punishment. Stories of man-carrying kites also
occur in Japan, following the introduction of the kite from China around the seventh century AD.

ROTOR WING

The use of a rotor for vertical flight has existed since 400 BC in the form of the bamboo-copter, an
ancient Chinese toy. The similar rotor on a nut appeared in Europe in the 14th century AD.

HOT AIR BALLOONS

From ancient times the Chinese have understood that hot air rises and have applied the principle to
a type of small hot air balloon called a sky lantern.

A sky lantern consists of a paper balloon under or just inside which a small lamp is placed. Sky
lanterns are traditionally launched for pleasure and during festivals. According to Joseph Needham,
such lanterns were known in China from the 3rd century BC.

RENAISSANCE

Eventually, after Firas’s construction, some investigators began to discover and define some of the
basics of rational aircraft design. Most notable of these was Leonardo da Vinci, although his work
remained unknown until 1797, and so had no influence on developments over the next three
hundred years. While his designs are rational, they are not scientific, and particularly underestimate
the amount of power that would be needed. Leonardo studied bird and bat flight, claiming the
superiority of the latter owing to its unperforated wing. He analysed these and anticipating many
principles of aerodynamics. He understood that "An object offers as much resistance to the air as
the air does to the object.” Isaac Newton would not publish his third law of motion until 1687.

In 15th century, Leonardo wrote about and sketched many designs for flying machines and
mechanisms, including ornithopters, fixed-wing gliders, rotorcraft, parachutes and a wind speed
gauge. His early designs were man-powered and included ornithopters and rotorcraft; how-ever he
came to realise the impracticality of this and later turned to controlled gliding flight, also sketching
some designs powered by a spring.

LIGHTER THAN AIR

In 1670, Francesco Lana de Terzi published a work that suggested lighter than air flight would be
possible by using copper foil spheres that, containing a vacuum, would be lighter than the displaced
air to lift an airship. While theoretically sound, his design was not feasible: the pressure of the
surrounding air would crush the spheres. The idea of using a vacuum to produce lift is now known
as vacuum airship but remains unfeasible with any current materials. In 1709, Bartolomeu de
Gusmao presented a petition to King John V of Portugal, begging for support for his invention of
an airship, in which he expressed the greatest confidence. The public test of the machine, which
was set for 24 June 1709, did not take place. According to contemporary reports, however, Gusmao
appears to have made several less ambitious experiments with this machine, descending from
eminences. It is certain that Gusmao was working on this principle at the public exhibition he gave
before the Court on 8 August 1709, in the hall of the Casa da India in Lisbon, when he propelled a
ball to the roof by combustion.

BALLOONS

1783 was a watershed year for ballooning and aviation. Between 4th June and 1st December, five
were achieved in France:
• On 4th June, the Montgolfier brothers demonstrated their unmanned hot air
balloon at Annona, France.
• On 27th August, Jacques Charles launched the world's first unmanned hydrogen-filled
balloon, from the Champ de Mars, Paris.
• On 19th October, the Montgolfiers launched the first manned flight, a tethered balloon
with humans on board, at the Folie Titon in Paris. The aviators were the scientist Jean-
Francois Pilatre de Rozier, the manufacture manager Jean-Baptiste Réveillon, and
Giroud de Villette.
• On 21th November, the Montgolfiers launched the first free flight with human
passengers. King Louis XVI had originally decreed that condemned criminals would
be the first pilots, but Jean-François Pilâtre de Rozier, along with the successfully
• petitioned for the honor. They drifted 8 km (5.0 mi) in a balloon-powered by a wood
fire.
• On 1st December, Jacques Charles and the Nicolas-Louis Robert launched their
manned hydrogen balloon from the Jardin des Tuileries in Paris, as a crowd of 400,000
witnessed. They ascended to a height of about 1,800 feet (550 m) and landed at sunset
in Nestles-la-Vallee after a flight of 2 hours and 5 minutes, covering 36 km.
AIRSHIPS

Airships were originally called "dirigible balloons" and are still sometimes called dirigibles today.
Work on developing a steerable balloon continued sporadically throughout the 19th century. The
first powered, controlled, sustained lighter-than-air flight is believed to have taken place in 1852
when Henri Giffard flew 15 miles (24 km) in France, with a steam engine driven craft. Another
advance was made in 1884, when the first fully controllable free-flight was made in a French Army
electric-powered airship, La France, by Charles Renard and Arthur Krebs. The 170-foot (52 m)
long, 66,000-cubic-foot (1,900 m3) airship covered 8 km (5.0 mi) in 23 minutes with the aid of an
8½ horsepower electric motor. However, these aircraft were generally short-lived and extremely
frail. Routine, controlled flights would not occur until the advent of the internal combustion engine.
The first aircraft to make routine controlled flights were non-rigid airships. The most successful
early pioneering pilot of this type of aircraft was the Brazilian Alberto Santos-Dumont who
effectively combined a balloon with an internal combustion engine.

On 19th October 1901, he flew his airship Number 6 over Paris from the Parc de Saint Cloud around
the Eiffel Tower and back in under 30 minutes to win the Deutsch de la Meurthe prize. Santos-
Dumont went on to design and build several aircraft. At the same time that non-rigid airships were
starting to have some success, the first successful rigid airships were also being developed. These
would be far more capable than fixed-wing aircraft in terms of pure cargo carrying capacity for
decades.
17TH AND 18TH CENTURIES

Italian inventor Tito Livio Burattini, invited by the Polish King Wladyslaw IV to his court
in Warsaw, built a model aircraft with four fixed glider wings in 1647. Described as "four pairs
of wings attached to an elaborate 'dragon’; it was said to have successfully lifted a cat in 1648 but
not himself. He promised that "only the most minor injuries" would result from landing the craft.
His "Dragon Volant" is considered "the most elaborate and sophisticated aeroplane to be built
before the 19th Century". The first published paper on aviation was "Sketch of a Machine for Flying
in the Air" by Emanuel Swedenborg published in 1716. This flying machine consisted of a light
frame covered with strong canvas and provided with two large oars or wings moving on a
horizontal axis, arranged so that the upstroke met with no resistance while the downstroke provided
lifting power. Swedenborg knew that the machine would not fly, but suggested it as a start and was
confident that the problem would be solved. He wrote: "It seems easier to talk of such a machine
than to put it into actuality, for it requires greater force and less weight than exists in a human body.
The science of mechanics might perhaps suggest a means, a strong spiral spring. If these advantages
and requisites are observed, perhaps in time to come someone might know how better to utilize our
sketch and cause some addition to be made so as to accomplish that which we can only suggest.
Yet there are sufficient proofs and examples from nature that such flights can take place without
danger, although when the first trials are made you may have to pay for the experience, and not
mind an arm or leg".

SIR GEORGE CAYLEY AND THE FIRST MODERN AIRCRAFT

Cayley's first innovation was to study the basic science of lift by adopting the whirling arm test rig
for use in aircraft research and using simple aerodynamic models on the arm, rather than attempting
to fly a model of a complete design. Sir George Cayley was first called the "father of the aeroplane"
in 1846. During the last years of the previous century he had begun the first rigorous study of
the physics of flight and would later design the first modern heavier-than-air craft. Among his
many achievements, his most important contributions to aeronautics include
 ➢ Clarifying our ideas and laying down the principles of heavier-than-air flight.
➢ Reaching a scientific understanding of the principles of bird flight.
➢ Conducting scientific aerodynamic experiments demonstrating drag and streamlining,
movement of the centre of pressure, and the increase in lift from curving the wing surface.
➢ Defining the modern aeroplane configuration comprising a fixed-wing, fuselage and tail
assembly.
➢ Demonstrations of manned, gliding flight.
➢ Setting out the principles of power-to-weight ratio in sustaining flight.

19TH CENTURY

Balloon jumping replaced tower jumping, also demonstrating with typically fatal results that man-
power and flapping wings were useless in achieving flight. At the same time scientific study of
heavier-than-air flight began in earnest. In 1801, the French officer André Guillaume Resnier de
Goue managed a 300-metre glide by starting from the top of the city walls and broke only one leg
on arrival.

In 1837 French mathematician and brigadier general Isidore Didion stated, "Aviation will be
successful only if one finds an engine whose ratio with the weight of the device to be supported
will be larger than current steam machines or the strength developed by humans or most of the
animals"Drawing directly from Cayley's work, Henson's 1842 design for an aerial steam
carriage broke new ground. Although only a design, it was the first in history for a propeller-driven
fixed-wing aircraft. It achieved lift-off under its own power after launching from a ramp, glided for
a short time and returned safely to the ground, making it the first successful powered glide in
history. Alphonse Penaud, a Frenchman, advanced the theory of wing and aerodynamics and
constructed successful models of aeroplanes, helicopters and ornithopters. In 1871, he flew the first
aerodynamically stable fixed-wing aeroplane, a model monoplane he called the "Planophore", a
distance of 40 m (130 ft). Penaud's model incorporated several of Cayley's discoveries, including
the use of a tail, wing dihedral for inherent stability, and rubber power.
The planophore also had longitudinal stability, being trimmed such that the tailplane was set at a
smaller angle of incidence than the wings, an original and important contribution to the theory of
aeronautics. Pénaud's later project for an amphibian aeroplane, although never built, incorporated
other modern features. A tailless monoplane with a single vertical fin and twin tractor propellers,
it also featured hinged rear elevator and rudder surfaces, retractable undercarriage and a fully
enclosed, instrumented cockpit. In 1884, Alexandre Goupil published his work La Locomotion
Adrienne (Aerial Locomotion), although the flying machine he later constructed failed to fly.

LEARNING TO GLIDE

In the last decade or so of the 19th century, a number of key figures were refining and defining the
modern aeroplane. Lacking a suitable engine, aircraft work focused on stability and control in
gliding flight. In 1879, Biot constructed a bird-like glider with the help of Massia and flew in it
briefly. It is preserved in the Musee de l'Air, France, and is claimed to be the earliest man-carrying
flying machine still in existence. The Englishman Horatio Phillips made key contributions to
aerodynamics. He conducted extensive wind tunnel research on aerofoil sections, proving the
principles of aerodynamic lift foreseen by Cayley and Wenham. His findings underpin all modern
aerofoil design. Between 1883 and 1886, the American John Joseph Montgomery developed a
series of three manned gliders, before conducting his own independent investigations into
aerodynamics and circulation of lift. Otto Lilienthal became known as the "Glider King" or "Flying
Man" of Germany.

He duplicated Wenham's work and greatly expanded on it in 1884, publishing his research in 1889
as Birdflight as the Basis of Aviation.He also produced a series of hang gliders, including bat-wing,
monoplane and biplane forms, such as the Derwitzer Glider and Normal soaring apparatus. Starting
in 1891, he became the first person to make controlled untethered glides routinely, and the first to
be photographed flying a heavier-than-air machine, stimulating interest around the world.
Sir Hiram Maxim was an American engineer who had moved to England. He built his own whirling
arm rig and wind tunnel and constructed a large machine with a wingspan of 105 feet (32 m), a
length of 145 feet (44 m), fore and aft horizontal surfaces and a crew of three. Twin propellers were
powered by two lightweight compounds steam engines each delivering 180 hp (130 kW).

The overall weight was 8,000 pounds (3,600 kg). It was intended as a test ride to investigate
aerodynamic lift: lacking flight controls it ran on rails, with a second set of rails above the wheels
to restrain it. Completed in 1894, on its third run it broke from the rail, became airborne for about
200 yards at two to three feet of altitude and was badly damaged upon falling back to the ground.
It was subsequently repaired, but Maxim abandoned his experiments shortly afterwards.

LANGLEY

After a distinguished career in astronomy and shortly before becoming Secretary of

the Smithsonian Institution, Samuel Pierpont Langley started a serious investigation into
aerodynamics at what is today the University of Pittsburgh. In 1891, he published Experiments in
Aerodynamics detailing his research, and then turned to building his designs. He hoped to achieve
automatic aerodynamic stability, so he gave little consideration to in-flight control.

On 6th May 1896, Langley's Aerodrome No.5 made the first successful sustained flight of an
unpiloted, engine-driven heavier-than-air craft of substantial size. It was launched from a spring-
actuated catapult mounted on top of a houseboat on the Potomac River near Quantico, Virginia.
Two flights were made that afternoon, one of 1,005 metres (3,297 ft) and a second of 700 metres
(2,300 ft), at a speed of approximately 25 miles per hour (40 km/h). On both occasions,
the Aerodrome No.5 landed in the water as planned, because, in order to save weight, it was not
equipped with landing gear.
WHITEHEAD

Gustave was a German who emigrated to the U.S., where he soon changed his name to Whitehead.
From 1897 to 1915, he designed and built early flying machines and engines. On 14 August 1901,
two and a half years before the Wright Brothers' flight, he claimed to have carried out a controlled,
powered flight in his Number 21 monoplane at Fairfield, Connecticut. The flight was reported in
the Bridgeport Sunday Herald local newspaper.

About 30 years later, several people questioned by a researcher claimed to have seen that or other
Whitehead flights. In March 2013, Jane's All the World's Aircraft, an authoritative source for
contemporary aviation, published an editorial which accepted Whitehead's flight as the first
manned, powered, controlled flight of a heavier-than-air craft. The Smithsonian
Institution (custodians of the original Wright Flyer) and many aviation historians continue to
maintain that Whitehead did not fly as suggested.

WRIGHT BROTHERS

The Wrights appear to be the first to make serious studied attempts to simultaneously solve the
power and control problems. Both problems proved difficult, but they never lost interest. They
solved the control problem by inventing wing warping for roll control, combined with
simultaneous yaw control with a steerable rear rudder.

Almost as an afterthought, they designed and built a low-powered internal combustion engine.
They also designed and carved wooden propellers that were more efficient than any before,
enabling them to gain adequate performance from their low engine power. Although wing-warping
as a means of lateral control was used only briefly during the early history of aviation, the principle
of combining lateral control in combination with a rudder was a key advance in aircraft control.
While many aviation pioneers appeared to leave safety largely to chance, the Wrights' design was
greatly influenced by the need to teach themselves to fly without unreasonable risk to life and limb,
by surviving crashes. This emphasis, as well as low engine power, was the reason for low flying
speed and for taking off in a headwind.

Performance, rather than safety, was the reason for the rear-heavy design because the canard could
not be highly loaded; anhedral wings were less affected by crosswinds and were consistent with
the low yaw stability. The Wrights continued flying at Huffman Prairie near Dayton, Ohio in 1904.
In May 1904 they introduced the Flyer II, a heavier and improved version of the original Flyer. On
23rd June 1905, they first flew a third machine, the Flyer III. After a severe crash on 14 July 1905,
they rebuilt the Flyer III and made important design changes. They almost doubled the size of
the elevator and rudder and moved them about twice the distance from the wings.

They added two fixed vertical vanes between the elevators and gave the wings a very slight
dihedral. They disconnected the rudder from the wing-warping control, and as in all future aircraft,
placed it on a separate control handle. When flights resumed the results were immediate. The
serious pitch instability that hampered Flyers I and II was significantly reduced, so repeated minor
crashes were eliminated. Flights with the redesigned Flyer III started lasting over 10 minutes, then
20, then 30. Flyer III became the first practical aircraft flying consistently under full control and
bringing its pilot back to the starting point safely and landing without damage.

PIONEERS IN EUROPE

Although full details of the Wright Brothers' system of flight control had been published in
L’Aerophile in January 1906, the importance of this advance was not recognised, and European
experimenters generally concentrated on attempting to produce inherently stable machines. On 13th
September 1906, a day after Ellehammer's tethered flight and three years after the Wright Brothers'
flight, the Brazilian Alberto Santos-Dumont made a public flight in Paris with the 14-bis, also
known as Oiseau de proie (French for "bird of prey"). This well-documented event was the first
flight verified by the Aero-Club de France of a powered heavier-than-air machine in Europe and
won the Deutsch-Archdeacon Prize for the first officially observed flight greater than 25 m (82 ft).
On 12th November 1906, Santos-Dumont set the first world record recognized by the Federation
Aeronautique Internationale by flying 220 m (720 ft) in 21.5 seconds. Only one more brief flight
was made by the 14-bis in March 1907, after which it was abandoned. In March 1907, Gabriel
Voisin flew the first example of his Violin biplane. On 13th January 1908, a second example of the
type was flown by Henri Farman to win the Deutsch-Archdeacon Grand Prix d'Aviation prize for
a flight in which the aircraft flew a distance of more than a kilometer and landed at the point where
it had taken off. The flight lasted 1 minute and 28 seconds.

MILITARY USE

Almost as soon as they were invented, airplanes were used for military purposes. The first country
to use them for military purposes was Italy, whose aircraft made reconnaissance, bombing and
artillery correction flights in Libya during the Italian-Turkish war. The first mission occurred on
23 October 1911. The first bombing mission was flown on 1 November 1911. The first war to see
major use of airplanes in offensive, defensive and reconnaissance capabilities was World War I.
The Allies and Central Powers both used airplanes and airships extensively. While the concept of
using the airplane as an offensive weapon was generally discounted before World War I, the idea
of using it for photography was one that was not lost on any of the major forces. All of the major
forces in Europe had light aircraft, typically derived from pre-war sporting designs, attached to
their reconnaissance departments. Radiotelephones were also being explored on airplanes, notably
the SCR-68, as communication between pilots and ground commander grew more and more
important.

BETWEEN THE WORLD WARS (1918 – 1939)

The years between World War I and World War II saw great advancements in aircraft
technology. Airplanes evolved from low-powered biplanes made from wood and fabric to sleek,
high-powered monoplanes made of aluminium, based primarily on the founding work of Hugo
Junkers during the World War I period and its adoption by American designer. William Bushnell
Stout and Soviet designer Andrei Tupolev.The first successful rotorcraft appeared in the form of
the autogyro, invented by Spanish engineer Juan de la Cierva and first flown in 1919. In this design,
the rotor is not powered but is spun like a windmill by its passage through the air. After World War
I, experienced fighter pilots were eager to show off their skills. Many American pilots
became barnstormers, flying into small towns across the country and showing off their flying
abilities, as well as taking paying passengers for rides. Eventually, the barnstormers grouped into
more organized displays. Air shows sprang up around the country, with air races, acrobatic stunts,
and feats of air superiority. The air races drove engine and airframe development the for example,
led to a series of ever faster and sleeker monoplane designs culminating in the Supermarine S.6B.
Trophy, With pilots competing for cash prizes, there was an incentive to go faster. Amelia
Earhart was perhaps the most famous of those on the barnstorming/air show circuit. She was also
the first female pilot to achieve records such as the crossing of the Atlantic and Pacific Oceans.

DIGITAL AGE - 21ST CENTURY

21st century aviation has seen increasing interest in fuel savings and fuel diversification, as well
as low cost airlines and facilities. Additionally, much of the developing world that did not have
good access to air transport has been steadily adding aircraft and facilities, though severe
congestion remains a problem in many upcoming nations. Around 20,000 city pairs are served by
commercial aviation, up from less than 10,000 as recently as 1996. At the beginning of the 21st
century, digital technology allowed subsonic military aviation to begin eliminating the pilot in
favor of remotely operated or completely autonomous unmanned aerial vehicles (UAVs). In April
2001 the unmanned aircraft Global Hawk flew from Edwards AFB in the US to Australia non-stop
and unrefuelled. This is the longest point-to-point flight ever undertaken by an unmanned aircraft
and took 23 hours and 23 minutes. In October 2003, the first totally autonomous flight across the
Atlantic by a computer-controlled model aircraft occurred.
 CHAPTER – II

RESEARCH DESIGN
RESEARCH METHODLOGY

INTRODUCTION

Under this section the chapter will show the methods and techniques that will be used to collect
and analyse data during research. The research to be carried out is on impact of Air Asia on India.
Areas to be touched on include research design, target population, types of data, sources of data,
tools to be used to collect data and the sampling design to be used.

RESEARCH DESIGN

A research design is a systematic plan to study a scientific problem. In this research descriptive
design has been used.

The purpose of this research is to know the criteria behind the success of AirAsia. The interview
asked questions about how AirAsia success to the person who related with AirAsia such as AirAsia
executive, Human resources manager, Airasia marketing and others. The question and the answers
are used for maximize benefits follow the objective of the research. The results from the answer
will show the real reasons of the criteria behind the success of AirAsia. The interview method is
unstructured interview that researchers have questions pattern to ask. Finally, researchers analyze
data by brainstorming and qualitative analysis to find conclusions.

SCOPE OF RESEARCH

This research built to analyse the factors that AirAsia successful and be the main reader among
low-cost carrier such as Operation management, external environment, and internal environment
RESEARCH PLAN

Type of research Market Survey

Market Segment Passengers/ Travellers

Geographical Area Bangalore

Data Sources Primary Survey Research

Secondary Print Media

Internet

Research Instrument Questionnaire

Sampling Plan Sampling Unit Airline passengers

Sample Size 30 passengers

SAMPLING DESIGN

Sampling design is ultimate for researchers to collect accurate information from the right people,
right time and right location for research questions. Sampling process comprises of five steps that
define target population, determine sampling frame and sampling location, select appropriate
sampling technique, determine sampling size and execute sampling process.

SAMPLING FRAME AND SAMPLING LOCATION

Sampling frame is “actual set of units from which a sample has been drawn”. In other words, all
units that have been included in the sampling frame have an equal chance to get selected as
respondents Nevertheless, there is no sampling frames for this study due to limited resources, thus
this study cannot be generalized. For sampling location, questionnaires were randomly distributed
in Bangalore. Besides, questionnaires were distributed to respondents in Low-Cost Carriers
Terminal (LCCT) because there is large number of potential respondents and able to provide
reliable information about airlines for a thorough representation about the levels of passengers’
satisfaction.

SAMPLING ELEMENT

The elements which have been selected in this study are the travellers who fall in the age category
of 18 years old and above because they are able to make decision by themselves and possess the
ability to rate on the quality of service. The selected respondents must heavily rely on the services
provided by airlines companies and at least travel once in a year.

SAMPLING TECHNIQUE

Sampling techniques can be divided into two types which are probability and nonprobability
sampling. It is impossible for researchers to collect data from all travellers, thus non-probability
technique is chosen in which the respondents are selected from the population in some non-random
manners Specifically, purposive sampling method is chosen whereby researcher has selected the
respondents who are relevant and compatible to the purpose of study. In other words, it can be
categorized by the use of judgment and deliberate effort to acquire representative sample. Besides,
purposive sampling does not produce a sample to represent a large population but it can meet the
purpose of the study. It may be sufficient for understanding human perceptions, needs, behaviours
and contexts. Thus, purposive sampling method can be truly applied in this study. An advantage of
using purposive sampling method is that unsuitable candidates will be eliminated and suitable
candidates will be remained in this study for better accuracy and reliability in accordance to the
purpose of study.

RESEARCH INSTRUMENT

For this study, self-administered questionnaires have been applied. Self-administered questionnaire
defines the method in which the respondents answer the questionnaire by their own, either on the
questionnaire papers or via Internet. Undeniably, the questionnaires serve as a very important tool
for this study. Questionnaire is inexpensive to collect data and the results can be consistently used
to compare and contrast. Besides, it can be distributed to a large number of potential respondents,
increase the speed and accuracy, facilitating data processing. However, extra caution must be taken
in designing the questionnaires for better clarification of each question. Evaluation is done upon
gathering of data from the questionnaires. Basically, the questions in the questionnaire were
adopted from previous researchers and modified based upon the necessity to fit into this study

SAMPLING SIZE

The larger of the sample’ size, the lower the likely errors to generalize the population of study 30
questionnaires were distributed to travellers randomly. Due to time and resources constraints, this
number of sample size is appropriate in generalizing targeted population.
SIGNIFICANCE OF THE STUDY

This study contributes to further research, organizational perspective and individual perspective
(customer). The certainty and reliability of the result are able to act as a guideline for future research
in Indian airlines industry. In organizational perspective, this study helps to foster better
understanding and knowledge on the CS. It also helps Airlines Company to identify the real needs
and wants of the customers in putting effort to acquire as well as retain the customer quality.

PROBLEM STATEMENT

The budget airline industry is not new to Asia but it has seen failure in the past and Air Asia has
made Malaysian proud with their achievement as the first Low Cost Carrier in South East Asia and
they have literally taken to the skies. Recently, there have been many complaints and concerns
about the service quality provided by Air Asia highlighted by the media and the personal
experience faced by the passengers.

Out of concern and after reading an interesting article on service integrity researched by Eberhard
E. Scheming who is a Professor of Marketing at St John‘s University, Jamaica, and Bo Edvardsson,
an Associate Professor of Business Administration at the University of Karlstad, we began to
research and found very few research has been done specifically area of customer satisfaction in
the budget airline.

It can be observed from Air Asia‘s advertisements and promotional activities that Air Asia is
working to position itself as the leader of low budget airlines by lowest price of tickets and even
giving free tickets to customers. However, low priced or free tickets alone will not keep customers
coming back to Air Asia. There are many other factors that affect customer satisfaction which are
important to create customer loyalty. Therefore, we found the importance of a research required to
provide a clear view into the factors that influence customer satisfaction among Air Asia
passengers.
LITERATURE REVIEW

Customer Satisfaction

Customer Satisfaction (CS) has continuously gained increasing attention in business to measure
products or service performance. In the simpler terms, CS is regarded as customers’ evaluation of
their purchases and consumption experience with a product or service to meet the customers’ needs
(Chen, Chang, Hsu, & Yang, 2011).

Cadotte, Woodruff and Jenkins (1987) defined CS as the emotional response of the customers.
Helms and Mayo (2008) defined CS or dissatisfaction as the derivation from the customers’
experience with a service encountered and the comparison of that experience to a given standard.
In marketing literature, service satisfaction can be classified as an emotional feeling by the
consumers after experiencing a certain service which in turn leads to an individual overall attitude
towards purchasing of service (Oliver, 1981). Hence, customer emotional response, feeling,
personal experience will determine the satisfaction and dissatisfaction of the service delivered.

Additionally, Gronroos (1984) stated that satisfaction of airlines passengers can be determined
through the contacts with the employees of the company, physical and technical resources, plane
itself, meals and other passengers in the flight. For the airlines industry, service quality (SQ) is
more visible and passengers may use it as a basis to judge the overall quality. Service provided by
the employees is the most visible for customers (Rhoades &Waguespack, 1999).

According to Lorenzoni and Lewis (2004), an understanding of the airlines customers and showing
their involvement and enthusiasm in delivering customer services is the key in satisfying and
retaining the customers. There are empirical researchers who have identified SQ, expectations,
disconfirmation, performance, desires and equity as significant antecedents of customer
satisfaction (Kaushik, Kaushik & Taneja, 2008). Carman (1990) stated that CS is fostered when
the service offered by the organization has exceeded their expectations. At the same time,
Woodside, Wilson and Milner (1992) stated that the customers of business services tend to stay
with the same provider (organization) if they are satisfied with service delivered in a consistent
basis. Besides, customer who satisfied with the service provider could recommend the provider to
other customers as well (Lam, Shanker, Erramilli & Murthy, 2004). In a service-profit chain,
Heskett, Jones, Loveman, Sasser and Schesinger (1994) defined that a low level of CS will lead to
lower customer retention rates and fewer referrals, which translates to reduced profitability and
slow down the growth of company’s revenue.

Service Quality

Leonard and Sasser (1982) and Rabin (1983) stated that the quality of goods and services has
become a recognized issue in the marketing context. Therefore, organization has to understand and
achieve SQ to satisfy the customers’ expectations and needs (Chen, et al., 2010). At the same time,
SQ is at the forefront of many carriers’ marketing strategies (Lorenzoni & Lewis, 2004).

SQ has been defined in many different ways. Zeithaml (1988) indicated that quality is a relatively
global value judgment; it can be defined as product and/ or service excellence or superiority.
Perceived SQ is evaluated by the actual performance of the service in terms of particular service
attributes in the specific context (Oliver, 1993). According to Kasper, Van Helsdingen and De
Vries (1999), they defined SQ as the degree of which the service, its process and its organization
can fulfill the consumers’ expectation. Parasuraman, Zeithaml and Berry (1988) defined that SQ is
the consumers’ judgment about the overall excellence of a service provider.

The judgment is the outcome of the difference between what a customer believes a service provider
should offer for them which based on his or her expectation and the actual performance of the
service. SERVQUAL instrument measures the SQ which is based on the assumption of the
perceived SQ derived from the comparison between the expected service and the actual service
delivered by the service provider. There are five dimensions under SERVQUAL model which are
tangibility, reliability, responsiveness, assurance and empathy.
CHAPTER – 03

COMPANY PROFILE
INTRODUCTION

Air Asia India is an Indo-Malaysian low cost carrier .Announced on 19 February 2013, the airline
is a joint venture with Air Asia Berhad holding 49% of the airline, Tata Sons holding 30% and
Telstra Trade place taking up the remaining 21% in the airline. The joint venture would also mark
Tata's return to aviation industry after 60 years. Air Asia India commenced operations on 12 June,
2014.Air Asia is the first foreign airline to set up a subsidiary in India. The airliner will operate
with the world's lowest unit cost of 1.25 (2.0¢ US)/available seat kilometre and a passenger break-
even load factor of 52%. It will hedge 100% of its fuel requirements for the next three years and
plans to achieve an aircraft turnaround time of 25 minutes.

The origins of the airline can be tracked back to October 2012, when Air Asia was keen to open
operations based out of India provided the aviation environment and tax structure were conducive
and friendly for low-cost airline operations. With the Indian government allowing a foreign direct
investment of up to 49%, in February 2013, Air Asia applied to the Indian Foreign Investment
Promotion Board (FIPB) to seek approval for commencing its operations in India. Air Asia
announced that it would establish a joint venture with Tata Sons and Telestra Trade place. Tata
sons would represent the airline with two non-executive directors in the airline's board. Air Asia
initially planned to begin operations to various tier 2 and tier 3 cities with Chennai International
Airport as its main operating base but later shifted its base to Bengaluru, operating its first flight
from Bengaluru to Goa. The introduction of Air Asia was expected to cause another price war,
ultimately leading to an increase in air traffic and some consolidation in the Indian aviation sector.

Air Asia initially invested an amount of US$50 million in the airline. In preparation for its
operations in India, Air Asia struck deals with online and offline travel agents throughout the
country. Previously, limited distribution of sales had affected the airline's performance in India and
Air Asia wanted to avoid that with its Indian subsidiary by all means. On 3 March 2013, the FIPB
officially permitted Air Asia to rent/lease aircraft and to carry cargo on its scheduled flights. The
airline then applied for a permission to schedule aircraft and transport passengers, which the FIPB
accepted on 6 March. Less than two months after Air Asia announced its plans to start an airline in
India, the joint venture was established on 28 March 2013 as Air Asia (India) Pvt. Ltd. In April,
the airline started recruiting candidates for their cabin crew, and allowed captains and first officers
to apply online for an interview in Bangalore. As the final procedure to obtain Air Operator Permit,
a proving flight was conducted on 1 and 2 May 2014 flying from Chennai to Kochi, Bangalore and
Kolkata. On the 8th of May, 2014, the DGCA issued Air Asia India an Air Operator Permit. On 30
May 2014, Air Asia India announced its maiden flight from Bangalore to Goa the service started
on 12 June.

HISTORY

AirAsia was established in 1993 and began operations on 18 November 1996. It was founded by
a government-owned conglomerate, DRB-HICOM. On 8 September 2001, the heavily indebted
airline was bought by former Time Warner executive Tony Fernandes and Kamarudin
Meranun's company Tune Air Sdn Bhd for the token sum of one ringgit (about US$0.26 at the
time) with US$11 million (MYR 40 million) worth of debts. The partners turned the company
around, producing a profit in 2002 and launching new routes from its hub in Kuala Lumpur,
undercutting former monopoly operator Malaysia Airlines with promotional fares as low
as MYR 1 (US$0.27). In 2003, AirAsia opened a second hub at Senai International
Airport in Johor Bahru and launched its first international flight to Bangkok.

AirAsia subsequently started its Thai AirAsia affiliate and began flights
to Singapore and Indonesia. Flights to Macau started in June 2004, and flights to mainland China
(Xiamen) and the Philippines (Manila) in April 2005. Flights to Vietnam and Cambodia followed
in 2005 and to Brunei and Myanmar in 2006, the latter by Thai AirAsia. In August 2006, AirAsia
took over Malaysia Airlines's Rural Air Service routes in Sabah and Sarawak, operating under
the Fly Asian Xpress brand. The routes were returned to MAS wings a year later, citing
commercial reasons. At the end of 2006, Fernandes unveiled a five-year plan to further enhance
AirAsia's presence in Asia. Under the plan, AirAsia proposed enhancing its route network by
connecting all of its existing destinations throughout the region and expanding further into
Vietnam, Indonesia, Southern China (Kunming, Xiamen, Shenzhen) and India. Through its sister
companies, Thai AirAsia and Indonesia AirAsia, the plan called for a focus on developing its hub
in Bangkok and Jakarta. With increased frequency and the addition of new routes, AirAsia
increased passenger volume to 13.9 million in its 2007 fiscal year.

During 2007, passengers from "The Barrier-Free Environment and Accessible Transport Group"
protested against the airline over its refusal to fly passengers who were completely immobile. They
claimed that people with disabilities were discriminated against when booking tickets online; the
CEO of the airline said it did not turn away passengers in wheel chairs On 27 September 2008, the
company announced 106 new routes to be added to its list of 60. The number of old routes
discontinued has not been disclosed. In August 2011, AirAsia agreed to form an alliance
with Malaysia Airlines by means of a share swap. The alliance was struck down by the Malaysian
government, in effect voiding the agreement of both airlines. By early 2013, AirAsia's profits
increased by 168% on a year-over-year basis compared to the same period in 2012. For the quarter
ending 31 December 2012, the airline's net profit stood at 350.65 million ringgit (US$114.08
million). Despite a 1% rise in the average fuel price, the airline recorded profits of 1.88 billion
ringgit for its full 2012 fiscal year.

In February 2013, AirAsia submitted an application to the Indian Foreign Investment Promotion
Board, through its investment arm, AirAsia Investment Limited, to seek approval for commencing
its operations in India. AirAsia asked to take a 49% stake in the Indian sister airline, which was
the maximum allowed by the Indian government at that time. AirAsia committed to investing up
to US$50 million in the new airline. Operations would begin in Chennai, expanding its network
throughout South India, where AirAsia already operates flights from Malaysia and Thailand. In
2019, AirAsia opened its first restaurant that serves plane food in Kuala Lumpur. In November
2020 AirAsia did not complete the purchase of six already specifically built Airbus A320neo
aircraft. This was as a result of the coronavirus crisis.
CORPORATE AFFAIRS

The head office is the Red Quarters (RedQ) at Kuala Lumpur International
Airport in Sepang, Selangor. The registered office is on level 13 of the Menara Prima Tower B
in Petaling Jaya. The airline has moved its head office to a new 56,985.1 m2 (613,383 sq ft),
RM140mil facility constructed at klia2 on 7 November 2016. Until the new head office opened,
the airline's head office has remained at LCCT. The new klia2 head office has been scheduled to
open at the end of 2015. It is scheduled to hold about 2,000 AirAsia and AirAsia X
employees. Aireen Omar, the AirAsia Country CEO of Malaysia, stated that the headquarters
needed to be redesigned because in the klia2 plans the location of the control tower had been
changed. Construction on the facility was scheduled to begin in July 2014. Malaysia Airports
Holdings is leasing the land that will be occupied by the headquarters. An AirAsia X flight
attendant gave the building the name "RedQuarters" or "RedQ", and its groundbreaking ceremony
was held in November 2014.

PRODUCT OF AIR ASIA

AirAsia X Berhad AirAsia X, the long-term, low-cost airline affiliate of the AirAsia Group that
currently flies to destinations in the Asia Pacific region and beyond. Now the airline serves 23
destinations in Asia, New Zealand, Australia, Africa and Middle East. AirAsia X operates a fleet
of 30 A330-300s. Airline has carried more than 19 million people since it began service in 2007;
AirAsia X won the Best Low-Cost Airline Premium. Premium Cabin world's best low-cost airline
and premium seats annual Skytrax World airline Award for four consecutive years from 2013 to
2016. AirAsia Premium Red Lounge the AirAsia Premium Red Lounge provides a warm and
inviting space, where passengers can rest or chill, as well as catch up on unfinished business before
continuing journey. The lounge offers VIP Room, Newspaper & magazines, Food & beverage,
Shower, Wi-Fi connectivity, Work station area, charging area, Ladies dressing area, Air-
conditioning, Flight information.
 AIR ASIA FLEET

Aircraft In Service Order Passenger

Airbus A320-200 66 180

Airbus A320neo 29 11 186

Airbus A321neo 2 351 236

Total 97 362

Previously operating the Boeing 737-300, AirAsia has now completely converted to the Airbus
A320 family. In June 2011 AirAsia ordered 200 Airbus A320neos at the Paris Air Show. The
planes were originally due to become available in 2015, and the deal was one of the largest ever
for commercial aircraft in a single order. The deal was worth US$18 billion at list prices, although
AirAsia will have obtained a substantial discount from those prices. The deal makes AirAsia
Airbus' single biggest customer. On 13 December 2012, AirAsia placed an order for an additional
100 Airbus A320 jets, splitting it between 64 A320neo and 36 A320ceo. At the Farnborough
International Air Show in 2016, Air Asia ordered 100 A321neos at an estimated cost of US$12.6
Billion dollars at list prices. Air Asia plans to fly these larger aircraft to airports that have
infrastructure constraints. AirAsia received its first A320neo in September 2016. With this, the
total number of orders that AirAsia had placed for the Airbus A320 family had gone up to 575,
reaffirming the carrier's position as the largest airline customer for the Airbus single aisle product
line.
FLEET SIZE AND DESTINATION

✓ 265 aircrafts, in 8 airlines

✓ 100 million passengers flown annually
✓ >500 million total passengers flown
✓ 152 destinations across 22 Countries
✓ 24 hubs Over 10,000 flights per week Over 388 routes, including 114 unique routes

SERVICES

AirAsia offers "Santan" menu, with options to buy on board offering food, drinks, merchandise
and duty free for purchase. Pre-purchasing of "Santan" meals is available at a lesser price than
those on board, and with additional selection AirAsia is accredited by the KL Syariah Index of
Bursa Malaysia, and in accordance with Shariah principles, it does not serve alcohol or pork.

However, this applies only to the regional AirAsia group flights, and not to the AirAsia X flights,
which do sell wine and beer on board. AirAsia is taking the first steps towards starting its
own frequent-flyer programme. The airline has signed an agreement to start a joint venture with
financial services firm Tune Money to launch a programme called "BIG". Under this programme,
it will issue loyalty points to AirAsia customers and third-party merchants. Points can then be used
to redeem AirAsia flights.

ON-LINE SERVICES

With the arrival of the internet technology, this opens a new opportunity for companies such as
Air Asia to strategies with the online model. We would like to examine how the consumer feel
about the ease of you and the possibility of the programming is designed to trap unwitting
customers to subscribe to services that they are not interested. One glaring example is the Go Insure
travel insurance premium is automatically included in the price of the ticket and you have to cancel
the insurance by clicking on the website. Due to the move to high speed internet communication
and tremendous increases in computing power, network latency has begun to play a more important
role in determining service response time. This will significantly impact on customer satisfaction.
It is a culture change in an organization where technology deployed at every customer touch point.
It is a management practice that turns casual consumers onto loyal customers by satisfying their
requirements. It is a practice that manages demand via customer-company relationship. It is a
business process of an organization that identifies, selects, acquires, develops, retains & better
serves customer. It is a strategy which optimizes revenue, profits, & customer satisfaction by
fostering customer satisfying behaviours. It enhances customer relationships that deliver value
beyond provided by the core product. It focuses on the achievement of operational excellence,
excellent, efficient processes that results in satisfied customers. Therefore, it may be concluded
that on-line services have positive relationship with customer satisfaction. Third-Party Services
Bhatnagar et al. (1999) examined the extent of usage of third-party logistics services in Singapore.
A similar study was undertaken in the Malaysian context. Other studies have outlined the linkage
between manufacturing organizations and third-party logistics service providers in Hong Kong,
Southern China, Japan, and South Korea.

A number of studies on the extent and usage of contract logistics and longitudinal measures
undertaken in Australia have been reported. Another study by Lieb and Randall (1996) reported on
the third-party services in American Logistics Industry. Many companies are outsourcing their
services to keep their focus on their core competencies and to avoid having a bloated organization.
Companies such as Air Asia has to realize that their contractors or agents are seen as part of Air
Asia and it is naïve to assume that when a service has been outsourced, the burden to serve has
been transferred to another party and they can absolve themselves from this responsibility towards
their customers. The Sky Bus service gets promoted through the website and you can pay through
the web and in fact, you would enjoy a discount when you do so, hence, it will be difficult to claim
ignorance when service gap takes place. The market cum thug style of client solicitation at Sentral,
delay in the departure of coaches to maximize the seating take up rate, rude staff and the lack of
recourse when problems arise and all these are issues which impact customer satisfaction.
Therefore, third-party services have impact on customer satisfaction.
Fare Charging Practices Price charging decisions in products or services affect customer
satisfaction. Value-conscious consumers may buy products more on price than other attributes
(Peter & Donnelly, 2007).When customer see all competing products as offering the same features
and benefits, their buying decisions are primarily driven by price (Ferrell, O.C., & Hartline, D.,
2008). Price has been identified as one of important reasons for purchase private-label products
(Jin, 2005). Prices offered to customers for products or services have an effect on customer
satisfaction (Cronin et al, 2000). The quality received by consumers must be perceived to be
reliable, responsive and empathetic. In the airline industry, the issue of the increase in petrol has
aroused the feelings of consumers all over the world. How did the airline derive the surcharge for
the fuel? Why should we pay for check in baggage when the baggage weight allowance is already
so low? Why is the cost for excess baggage higher than the conventional airline? Is there
justification to impose additional fees for express boarding? We intend to measure the satisfaction
level of customers in the section for fare charging practices. Therefore, fare charging practices have
impact on customer satisfaction. Advertisement Malaysian Airline took the initiative to advertise
their tickets at the actual price that the customers have to pay. The advertisements attract the
consumer with so much goodies when it is only limited to a few and important information is in
small print only. Consumers have to pay for one way though they have advertise that they are
giving away free tickets and many consumers thought that it is meant for the entire return trip.
Advertisements most of the times overpromised and the company then under deliver its offers.

Research has shown that the resource preference model enhances theoretical undertaking of cross-
cultural consumer behaviour and provides culture- specific guidelines for measuring the inevitable
service failures. It is important that company delivers service consistently and the staff must be
observant and diligent so that no ambiguous service is rendered to the consumer. The staff must be
passionate to serve everyone without any fear or favour. Service recovery is definitely an important
aspect of service and employees must be trained to understand the importance of integrity and to
serve everyone fairly and be given an equal attention. Borrowing from their tagline of Now
Everyone Can Fly, Air Asia should adopt this tagline for their service commitment Now Everyone
Gets Served‘ Air Asia must not use the excuse of being a low budget airline, hence, they need to
cut corners when it comes to service. It is disturbing to find that there is no Air Asia service counter
in the LCCT. Air Asia needs to take a closer look in this aspect of customer service leading to
satisfaction. Customer Services provided by a particular airline become customer concern during
pre-flight stage. Stimulates improvement on customer‘s air travel experience. Delivering best
experience right from checking in to baggage handling (Le Bel, J.L., 2000).Singapore Airlines
voted as the best airline in the world, the Malaysian Airlines has been voted as the best in-flight
services airline category for the year 2007 (IATA, 2008).In-flight services has impact on customer
satisfaction Service is not a uniform concept and there are great differences among different
industries. However, services and the conditions under which they are delivered have certain
generic characteristics in common. Firstly, the customer often participates in a direct and active
way in the production process as coproducers by carrying out parts of the service himself. The
customer is privy to the service delivery experience but he also contributes to quality and integrity.
Second, services are largely intangible and therefore difficult to explain and difficult for the
customer to assess before purchase and thus special emphasis is placed on the marketing of the
services and it should be ethical and delivers what that has been advertised or communicated to the
consumer. Third, employees play a pivotal role in the delivery of service and employee satisfaction
has often been tied to service quality and the company should conduct ethics training and ensure
employee satisfaction so that the service integrity is not compromised. Fourth, service are often
broken into core service and support service but the customers has always viewed service in
totality. We see integrity as a key factor affecting the customer‘s perception of the value of the
service, where value is defined as quality defined as quality in relation to cost.

The International Standards Organization (ISO) defines quality as ―The totality of Features and
characteristics of products and services that bear on its ability to satisfy stated or implied needs‖.
In creating quality, we argue that the quality constellation is formed by the competencies within,
and relationships between, three constituencies: customers, employees, and suppliers/partners. In
as much as service quality is experiential in nature, service integrity is a vital dimension of this
experience.
VISION

“To be the largest low-cost airline in Asia and serving 3 billion people who are currently
underserved with poor connectivity and high fares.”
“Now Everyone Can Fly”

MISSION

➢ “To be the best company to work for whereby employees are treated as part of a big family,
➢ Create a globally recognized ASEAN brand,
➢ To attain the lowest cost so that everyone can fly with AirAsia,
➢ Maintain the highest quality product, embracing technology to reduce cost and enhance
service levels.”
➢

BUSINESS MODEL

➢ Low-cost-carrier

SHAREHOLDERS

➢ Tune Air
➢ Employees Provident Fund Board
➢ Genesis Smaller Companies
➢ Wellington Management Company
➢ The Nomad Investment Partnership Lp Cayman
BUSINESS CHALLENGE

Since 2001, AirAsia has swiftly risen to become one of the leading low-cost carriers in the world.
In Malaysia where its headquarters and other key corporate functions are based, one of its key
human resource challenges has been to stay ahead of the growth curve by sourcing for quality
candidates to critical high-level positions within the company. AirAsia had been advertising on
social media networks such as Facebook and Twitter as well as other job portals to executive or
executive roles. However, while this approach worked well for positions such as Flight Attendants
and Guest Service.

STRATEGY

✓ Safety first
✓ High aircraft utilization
✓ Low fare. No frills
✓ Streamline operation
✓ Lean distribution system
✓ Point to point network

ACHIEVEMENTS

YEAR 2012

✓ ATW Value Airline of the Year

YEAR 2011

✓ Best Asian Low-Cost Carrier by TTG Travel Awards 2011

✓ World’s Best Low-Cost Airline
✓ Best Low-Cost Airline - Asia by Skytrax
PRICING

✓ Fares are significantly lower than those of other airline service providers
✓ Website fares are much cheaper compared to the frontline counter price
✓ Promotion pricing strategy has enhanced AirAsia’s reputation in making the promises
become reality

SUBSIDIARIES

✓ Air Asia India

✓ Indonesia AirAsia
✓ Thai AirAsia
✓ Philippines AirAsia
✓ AirAsia X
✓ AirAsia Japan
✓ AirAsia Zest

COMPETITORS

✓ Easy Jet
✓ Malaysian Airline
✓ Ryan air
✓ Singapore airline
✓ Tiger airways
✓ Southwest airlines
✓ Thai airways international
OBJECTIVES

➢ To identify the critical factors that make AirAsia very success in aviation industry
➢ To measure the level of customer satisfaction among Air Asia passengers.
➢ To analyse the marketing strategy of Air Asia.
➢ To analyse the operational efficiency of Air Asia.

AIRASIA INTERNAL CAPABILITIES

✓ Foster a dependency on Internet technology; such as direct ticketing

✓ Online booking, online checking (flight status, promotions), boarding passes on mobile
phones
✓ Investment in the AirAsia Academy
✓ Dynamic environment between employees and management, quarterly meetings
✓ No communication barriers between employers and employees
✓ AirAsia Internal Capabilities
✓ “Employees before customers”
✓ Aggressive marketing tactics, massive advertising, promotional packages
✓ Employee motivation - rewards free flights for their staff
✓ Offer customers the ticketless concept
✓ Low operating costs - wages, airport fees, short ground waits due to simple boarding
processes
✓ Keeping costs low - uses one type of aircraft, Airbus A320
AIRPORT OPERATIONS

I. INTRODUCTION

Early airports had only very basic functions, designed at meeting the simple needs of early flyers.
As transportation evolved, airports became more complex entities – linking communities together
through an inter modal system. Airports provide facilities and services to many organisations
involved in air transportation. These agencies play different roles. In addition to direct customers,
airports need to deal with a number of external partners, who in spite of their remoteness play an
important role in the success of an airport.

To understand an airport better let us define it:

Surprisingly enough, there is no official definition of an “Airport”. Even the International Civil
Aviation Organisation does not define it. To make a definition of our own, we shall start from the
obvious and work up towards a complete definition of an airport. As we can think only about the
operations of an aircraft while making a definition, we should always remember that the landside
aspect of airports is as important as its airside.

As an arriving passenger, the process would be reversed as you would arrive by air and then leave
the airport by surface transportation. From the above statement, we can formulate a definition such
as: An airport is a facility where exchange takes place between land transportation and the air mode
of transportation. This definition introduces inter-modal processing but does not talk about a
situation where you would arrive by air and depart by air without exiting the airport. However, in
a given airport the number of connecting passengers represent only a small percentage compared
to the total traffic. All these definitions are valid and they apply to an airport to some extent
although the main function of an airport is to provide an interface between the surface mode and
air mode of transportation.
II. AIRPORT CLASSIFICATION

The airport is classified into three major areas namely Landside, Terminal and Airside. Let us look
into each aspect of an airport in detail.

A. Landside

Almost every air trip starts and ends with a surface mode of transportation. However, not all rides
are made by passengers alone, guests come to the airport to meet or greet passengers,
employees come to work, and delivery and service vehicles can be numerous. These vehicles
require an efficient road network, adequate parking facilities, and a good connection to
the outside road network. Roadway and parking congestion can be a major cause of
disruption and delay for the passengers and visitors at airports. The technological advancements to
alleviate this problem could be, interdiction of dedicated rail links between the city and the airport,
use of intra-airport automated people movers and automated pay equipment in parking lots etc. The
landside facilities can also be used for adding additional revenue to the airports by providing space
for advertisements. These advertisements are a benefit to both, the advertising company because
their sales improve and to the airport because the company needs to pay a rent for using the airport
space for their advertisement. The landside infrastructure can be made more attractive and
advanced so that it motivates the passengers to fly more frequently.

B. Terminal

The terminal building is the place where passengers, luggage and freight change takes place
between the land mode and the air mode. The terminal is processing facility for which technological
changes have been constant and profound. While the initial terminal buildings were constructed in
a way only to protect passengers and employees from the elements, modern terminals are
sophisticated infrastructures with almost all amenities. Most of the improvements are evolved
around security, efficiency and comfort. Large terminals often provide moving sidewalks to reduce
walking distance. Computerised ticketing and check-in procedures have become common to speed
up the process and reduce congestion. Automated baggage sorting equipment expedites baggage
processing and reduces the risk of misdirected luggage. Aviation security did not become an issue
until when the first threats against civil aviation were made. Until then airport allowed public access
near the aircraft with only minimal pre-boarding control: checking the passengers was unheard of
and baggage screening was unnecessary. As security became more important, airports implemented
measures to prevent unlawful interference with aviation. Fencing of airports and restricted access
to aircrafts, screening of passengers and baggage were initially a manual operation. Now the
screening relies on state-of-the-art technology such as metal detectors, machine-readable passports
and biometric recognition equipment etc.

C. Airside

In the earlier days of aviation, aircrafts were light, slow and operated in good meteorological
conditions. They could operate out of grassed strips and a small hangar was the only ground facility
required. As aircrafts became faster and heavier and as the need for reliability increased, hard
surface runways had to be constructed; eventually these runways were equipped with edge lighting
to allow flights to operate in reduced visibility conditions also. As the characteristics of aircrafts
increased, longer and wider runways were required with higher pavement strength. But after few
years more powerful engines were invented and the runway length gradually decreased and became
stabilized. Air Traffic Control (ATC) was created when the density of air traffic increased,
especially on and around airports: there was need for some sort of order to keep flying safe. ATC
was established first in the form of Control Towers, with the responsibility to prevent collisions on
ground and in the air, near airports, and to provide a smooth flow of traffic. With further
advancements, along with ATC came the need for radio communication between pilots and air
traffic controllers. To that effect, radio transmitters and receivers were installed at airports and on-
board flights.
III. AIRPORT OPERATIONS

Airport operations are those tasks and duties that has be carried out in the above-mentioned areas
of an airport. There are several operations few of which are discussed below:

A. Representation of Airlines

This sector mainly involves the administration of an airport. Contact negotiation, supervision,
evaluation of contact compliance, inventor management are all a part of airline
representation. To some extent it also holds financial responsibility. Contact negotiation and
administration takes care of the following services:

I. Airport use agreements

The operations are those involved with setup of ticket counters, common use facilities and services
(like toilets, kiosk machines, ATMs, packing machines, weighing machines etc), control and
safeguard of gate and jet-way, fee waivers & incentives for the employees working inside the
airport.

II. Bulk purchase programs

As airports handle a lot of people each day, huge amount of resources is required for the services
that the airport provides. These services include passenger services (such as help desks, information
centre, recreation facilities, shopping malls etc), catering supplies for the restaurants/food chains
operated by the airport, tags for bags, ramp facilities and into-plane fuelling.

III. Tie-up services are those that deal with the outsourcing of the above and below wing services.
Contract compliance takes care of:

I. Station manuals

This involves the preparation and maintenance of Station Operation Manuals enforcing customer
standards and requirements. Also, the training of all airport contract members will be guided by
Station manuals.

II. Performance standards and daily monitoring

There will be an everyday check-up of the performance of ground operations handled by ground
handlers for smooth and effective functioning. Similarly, there will be daily monitoring of
passenger services also.

III. Quality control

This is one of the major and prime sections of an airport service because the quality on any task
should not be compromised as that affects the reputation of an airport. Once the good impression
of passengers is lost, its hard to earn back, therefore, periodic check rides will be there to monitor
the performance of vendors.

IV. Financial compliance

The most important part of any organisation is the finance as money is the driving force of a
successful outcome. Auditing of
services and invoices and budgetary controls are handled by this section.
Management of the Inventory

I. Inventory warehousing, controls, budgeting and purchasing are all managed by this sector. Below
are a few examples that are taken care of.

1. Boarding tickets (passes).

2. Bag tags.
3. Lost and damaged baggage claim forms.
4. Catering and toiletry supplies.
5. Alcoholic beverage-controlled storage.
6. Cabin supplies.
7. In-flight magazines and related items.
8. Portable equipment (laptops, printers, etc.).

Financial responsibility

I. Prepayments & deposits, reconciliation of vendor invoices and escrow accounting services are
the financial responsibilities of an airport.

1) Services to be provided for passengers

In a given business customer is god and to satisfy a customer good service is the best and most
efficient way. For an airport passenger are its god and service to passengers is of at most
importance. Few of the services are discussed below:

➢ Airline visibility & branding – this includes the following

I. Airport signage

To avoid passenger congestion at any given point of time there must be a

smooth transition of passengers into the airport, within the airport or out of the airport, so to
achieve this there must be sufficient and legible signage all around the airport such that any
passenger is not stuck at a point.

II. Airline attire for contract employees

There are so many airline services in todays world and

there are passengers who fly with every airline according to their budget and convenience. After
booking of tickets when a passenger reaches the airport he/she has to approach the representative
of that particular airlines for further procedures. Therefore, the employees must be provided with
an attire that consists of the airline logo or other identification so that passengers are not mis
leaded.

III. Flight information Display Software (FIDS)

It provides the graphics for flight information data system for airport operations and for the
information for passengers about the arrival or departure or delay of aircrafts. All the operations
require particular staff for taking care of it. Majority of staffing is required by :

I. Passenger check in (or ticket) counters – this task requires a reservation compatible equipment
and handles the following operations
1. Issue of boarding passes
2. Baggage collection, tags and appropriate bar codes for appropriate movement of luggage
and also collection of fees for excess baggage.
3. Upgrade sales and ass-collects as required.

II. Gate personnel – They are responsible for the boarding procedures, passenger manifest reporting
and announcements.
Co-ordination

I. A problem at one stage for a passenger affects the further stages. Proper coordination between
the operations are required because all the operations are inter- related in a way or other.

Catering

I. It is the service that provides food and beverages for the passengers and the crew. It has to take
care of services such as menu & vendor selection, supplies and inventory control, arrange sufficient
meals for the crew etc.

Customer service

Involves two major and important services to be provided by the airport, one for the emergency
and protection of passenger baggage and the other for reservations.

I. There is provision at every airport for lost and damaged bag claims and complaints. Also,
customer care is available through toll free numbers and e-mail services to register
complaints and claim baggage.

II. Reservations are also an important customer service. It can be done via online bookings, call
centre operations or any software that is developed for the customer to handle his
requirements such as yield, accounting, manifests etc.
2) Ground Services

Ground services are those operations that have to be taken care by the airport around the runways,
taxiways and aprons. There are variety of them, some are listed below:

1. Loading/unloading of luggage into/out of the aircrafts.

2. Transfer of the baggage to appropriate destination.
3. Assistance provided to balance the weight accordingly.
4. Towing & push back of aircrafts.
5. Marshalling of aircrafts.
6. Aircraft parking assistance for both Remain Over Night and hard stand.
7. Provide support equipment for air conditioning, ground power unit and air start.
8. Fuelling of planes is also an important task of ground service.
9. Management of waste from aircrafts.
10. Cleaning and servicing facilities.
11. De-icing of aircrafts especially surface of wings.

3) Flight operations

Apart from landside, few airside operations should also be managed by an airport. They are
discussed below:

I. Tracking of aircrafts
Customer satisfaction and security are given additional care in airport operations. One way of
providing safety to customers is by tracking their aircrafts in real time with the help of satellites.
This information helps them to determine down line decisions, delay in arrival or if any sub services
are required. It also monitors the movement of other aircrafts.
II. Communication

It is also a crucial task to be managed. It involves exchange of messages between the airlines and
stations at airport for information sharing and updates. Flight following is done to update
information regarding flights for reservation tasks and down line stations. Airline operational
schedule is also issued by the communication department, this schedule is provided to airport
officials, ground handlers and passenger services.

III. Support services

It is the duty of the airport to acquire international landing rights and approvals from inland
government agencies, agricultural department, immigration and customs. Assist airlines with route
planning for the most cost-effective route for airline and also safe for passengers.
Provide accommodation and transportation for airline crew members.

IV. Load control

Help in making decisions related to weight of the aircraft and balance issues. Make arrangements
for transport and delivery of any baggage or passenger omitted
due to operational reasons.

IV. AIRPORT OPERATIONS MANAGEMENT

The federal aviation administration has laid few compulsory operations that all the airport around
the globe need to provide. These rules and regulations are mentioned in Section-D of part 139
which is Certification of Airports. They include the following:
1. Pavement Management

Pavement refers to the top most part (surface) of a runway or taxiway. It is either made of asphalt
or concrete. The pavement must have sufficient load carrying capacity, it must be safe for operation
of an aircraft, it must have the ability to provide good ride to the aircrafts. The minimum
requirements for a pavement are: it must be clear of foreign objects (mud, dirt etc), no cracks or
holes on the surface, it must be level and dry. The pavement must also be well lit for night vision,
markings and signs have to be accurate. It is the responsibility of the airport to keep the pavements
well-maintained.

2. Safety Inspection

To maintain the safety of airport operations timely inspections are important. The inspections have
to be carried upon areas such as aircraft parking (Apron), runways, taxiways, buildings, hangars,
fuelling facilities etc. The need for inspection is to make sure that the above-mentioned areas are
void of obstacles, tyre debris, ice or snow, animal hazard etc because the presence of any of these
things will cause huge damage to the airport as well as the aircraft.

3. Aircraft Rescue and Fire Fighting (ARFF)

It is a mandatory service to be provided by all airports. The main motto of ARFF is to save lives.
The capability of ARFF at airport has to be at its peaks because they mean the difference between
life & death of all the humans on board. The time limit to respond to fires by ARFF is about 3
minutes. They must be well equipped and not be lethargic about the occurrence of accidents.

4. Control of Ice and Snow

The presence of ice/snow on the surface of runway or taxiway or on the aircraft itself will affect
the ride of aircraft i.e., it will affect the friction between the aircraft tyres and the pavement, this
will in turn cause problems in take-off and landing; ice on the aircraft will lead to loss of direction
control & reduces aircraft performance. Therefore, to avoid any danger that might end up in an
accident, there must be timely removal of snow and ice, appropriate material selection for the
construction of pavement, notification to aircraft if any pavement is unsatisfactory.

5. Bird/Animal hazard management

Birds flying in and around airports have been a serious threat to aircrafts. They cause huge damage
to the aircrafts which may lead to loss of human life. It is the responsibility of the airport to control
the movement and presence of birds or animals within airside limits. Few control methods that
could solve this issue are: use noise making equipment, this will scare the birds and they will move
away from the airports, inform the traffic control about any movement of birds, cut down trees so
that it will discourage bird population.

6. Other services such as NOTAM (Notice to Airmen) is present to update information about any
hazards or change in component.

7. Traffic and wind direction indicators need to be setup to provide wind surface direction to pilots.
For air carrier operations in airports without control tower a traffic pattern indicator and landing
strip indicator must be put up around the wind cone for all the runways with right hand traffic
pattern.

Thus, to conclude I would say that for successful establishment and growth of an airport, all the
members involved in each and every stage must do their duties with great care and efficiency. A
single person cannot do all the operations, there are numerous managers, supervisors etc. who have
been given various responsibilities with expectation of successful work completion. The airports
must encourage and appreciate people for their work. Dedicated work will run the operations of
airport smoothly without any hurdle. These are few of the most important airport operations. An
airport cannot be certified without the facilities to provide the above mandatory operations. There
will be periodic inspections by the International Air Transport Association to ensure that the
airports are functioning with good standards and all basic facilities.
 CHAPTER – 04

DATA ANALYSIS AND

INTERPRETATION
DATA DESCRIPTION

The study will use both primary and secondary data. The primary data will be collected through a
structured questionnaire. The questionnaires are aimed at collecting data on impact of Air Asia on
Indian population as well as comparing it with other Indian aviation sectors. The secondary data is
from published sources such as the journals, books and online available information.

DATA ANALYSIS METHOD

The data has been checked for accuracy and completeness of recording of the responses this study
helps in summarizing the data by use of descriptive statistics such as tables and percentages. It has
then been presented in form of pie chart, bar graphs and line graphs where possible. Data analysis
provides an easy way of interpreting information and hence arriving at more accurate conclusions.

TARGET POPULATION
The study targets the population of Bangalore Primary data has been collected through
questionnaires and secondary data has been used to assist the evaluation of data to be collected in
the field. Data collected in the field has been tested and results has helped to write a report upon
completion of analysis

DATA COLLECTION

PRIMARY DATA

Primary data is the data that has been collected from first hand-experience. Hence, it is more
reliable, authentic and objective in data collection. For current study, self-administered
questionnaire is chosen due to its convenience, inexpensive, reduction of biases and greater
anonymity (Data-Collection Tools,” n.d.). The purpose of the questionnaire is to generalize from a
sample to a population to make inferences about the characteristics of the population. Therefore,
questionnaires were distributed to the respondents who have been travelling by air, particularly
with Air Asia in order to capture the level of passengers’ satisfaction.

➢ Interview
➢ Chief Executive Officer of AirAsia
➢ Chief Financial Officer
➢ President and Group Chief Operation Officer
➢ Group Chief Commercial Officer

SECONDARY DATA

➢ Thesis
➢ AirAsia’s Annual Reports, 2015
➢ Study report
➢ News
➢ Previous interview result

STATISTICAL TECHNIQUES

FACTOR ANALYSIS

The reliability of the measurement scales was asses using factor analysis. The questions were
analysis using a principal component extraction with variance (orthogonal) rotation and using
Eigen value greater than 1. The screen plot was used as a guide to decide on the number of factors
to be extracted.

SCALE MEASUREMENT

Scale measurement was used to check the reliability and validity of this study. Reliability tests on
how consistent a measuring instrument determines a particular concept. Instead, validity tests on
how well an instrument measures the particular concept it is supposed to measure. This means that
validity is concerned with the stability and consistency in measurement.

SWOT ANALYSIS

AirAsia has shown that company has its strength in the management, operation efficiency and low
cost and its weaknesses are highlighted with the poor staffing, no response customer care and other
attractive marketing strategy.

STRENGTHS

➢ Steady and Consistent positioning: Air Asia has been positioned as a low-cost airline The
airline has been successful in ensuring that they consistently keep their operating costs as
low as possible and this means that the benefits of this trickle into the pricing.
➢ Weekly flights: Through customer research, Air Asia realized that many customers travel
from Trichy to Chennai and then onward to Kuala Lumpur, Singapore, and Bangkok which
was proving to be expensive. This made the airlines start weekly flights to Kuala Lumpur
priced as low as Rs 12000 as return fare in comparison to Rs 21,000 of other airlines.
➢ Extensive coverage in India: Air Asia was quick to realize the huge prospect that India
offered and thus moved into the region. The airline operates around 120 flights to India
connecting various key destinations and ensuring that economic travel option is offered to
customers.
➢ Innovation in service: Air Asia has been using cutting-edge technologies for innovation.
Some of their service innovation include online ticket reservation printing and even e-
check-in. The airline has also been streamlining costs by replacing human effort with
technology through online services
➢ Successful cost-cutting: Air Asia is a low-cost airline and they have taken all possible
measures to cut down on costs. One strategy that has been followed by the airline is to
transfer the onus of service to the customer making most of the work as self-service.
WEAKNESSES

Weaknesses are used to refer to areas where the business or the brand needs improvement. Some
of the key weaknesses of Air Asia are:

➢ Sustaining costs: Air Asia is a low-cost airline and thus it is critical that the airlines keep
its operating costs as low as possible. With fluctuations in fuel costs and increase in service
costs, the airlines find it immensely challenging to keep their costs as low as possible.
➢ Low Profits: In order to keep their positioning of a low-cost carrier Air Asia keeps their
pricing as low as possible and thus rely completely on volumes for their profits which in
turn has resulted in lowering the profits as well as reduced continuous revenue inflows.
➢ Challenges in balancing service quality with pricing: The USP of Air Asia is the low-cost
carrier image it carries. However, customers are not willing to compromise on quality just
because they charge low and satisfaction is based on the quality of services. The airline thus
finds it challenging to balance the quality with pricing and it has been alleged that
compromise on quality.

OPPORTUNITIES

Opportunities refer to those avenues in the environment that surrounds the business on which it can
capitalize to increase its returns. Some of the opportunities include:

➢ Surge in overseas travel: In Asia where Air Asia is based out of there has been a surge in
business travel. Destinations like Singapore, Malaysia, and Bangkok are popular in the
world tourist map and vacation seasons also see a surge in pleasure travel. These are
opportunities that the airline can capitalize on.
.THREAT

Threats are those factors in the environment which can be detrimental to the growth of the
business. Some of the threats include:

➢ Competition: The company faces a lot of competition from brands such as Air India,
Singapore Airlines, Virgin Airlines etc.
➢ Management of costs: Air Asia is finding it immensely difficult to manage the fluctuations
in costs of fuel and also to maintain its vast fleet of aircraft. The management of costs across
time is the most critical challenge that the airline faces.

DRAFTING OF A QUESTIONNAIRE

The formulation of the questionnaire, i.e., the structure and the disguise to be used in the
questionnaire depends upon the kind of information that is desired. Questionnaire was prepared
over a period of 5 days by intensive brainstorming. Valuable advice regarding changes was given
by my marketing teacher, Ms. Laxmi Reddy, has resulted in the formulation of the questionnaire
through which responses were collected and analysed. A copy of the questionnaire has been
attached as an annexure to the project.Since my objective was to derive out the maximum
information out of the passengers without making the whole exercise boring and troublesome, I
decided to keep majority of the questionnaire close-ended. In order to generate and sustain the
interest of the respondents, the initial questions pertained to the gathering of simple information
like the frequency of travel, the choice of airline and the purpose of travel. Since, I had to balance
the twin objectives of gathering maximum information and at the same time retaining the interest
of the customers, I was compelled to squeeze in a lot of questions and club them up in a single
question. The question pertaining to assessing the impact of private airlines on Indian Airlines, for
this the respondents ticked in the various options under different parameters. Last but not the least,
the respondents were asked to pen down some personal information purely for statistical purposes,
with an assurance that it would be kept confidential.
OBJECTIVES

➢ To identify the critical factors that make AirAsia very success in aviation industry.
➢ To measure the level of customer satisfaction among Air Asia passengers.
➢ To analyse the marketing strategy of Air Asia.
➢ To analyse the operational efficiency of Air Asia.

OBJECTIVE 1:

To identify the critical factors that make AirAsia very success in aviation industry.

a) What are the key factors behind the success of Air Asia?

➢ Factors behind the success of AirAsia

1. Cheaper tickets:
The price of the tickets for AirAsia is almost half of its competitors. Also, domestic flights are
more convenient as it takes less time and money. For example, traveling from Kuala Lumpur to
Penang by plane takes about 1 hour and the price of the tickets purchased in advance is between 7
to 15 dollars. Using the bus for the same direction will take about 5 hours and cost from 10 to 12
dollars.

2. Low-cost:
AirAsia increases sitting capacity and minimizes services by not providing customers with food &
beverages, earphones, movies and so on. By this, it cuts operating costs for about 33% and lowers
the prices of tickets. Also, AirAsia, in most cases, does not use primary airports to pay lower fees.

3. The developed management team and good quality:

The employees of AirAsia are very competitive and have good communication skills, diverse
experiences, and knowledge in their working area. For example, they work cooperatively with the
government, other airlines and even aircraft manufacturers like Airbus and gain advantages in the
form of subsidies and sales. Moreover, it shows that it is possible to gain a low price and high
quality.

b) What are the criteria for AirAsia?

The criteria behind the success of AirAsia have 5 factors. The first one is machine. AirAsia use
one type of aircraft and have good aircraft design. The second is supportive. They have partnership
in hotel, car rental and tour agency moreover they have financial support from shareholders.

c) What makes AirAsia so successful?

AirAsia was established in 1993 and began operations on 18 November 1996.AirAsia is a

Malaysian low-cost airline. It is the largest airline in Malaysia by fleet size and destinations, and
Asia’s largest low-cost airline by passengers carried and jet fleet. AirAsia’s registered office is in
Petaling Jaya, Selangor while its head office is at Kuala Lumpur. AirAsia become successful just
with the help of a contest that is called “AirAsia Friendsy Facebook Campaign”.

d) How can AirAsia improve?

The New Skies reservations system is really causing a lot of problems. I did a web booking in
Singapore and had three local credit cards denied purchase. The whole process was very frustrating
and it must have taken me nearly an hour to finish the transaction. This happened to me not once,
but twice. The other annoying issue is "convenience fees" and the up-sale process that makes
buying travel insurance the default - purposely made confusing.
OBJECTIVE 2:

To measure the level of customer satisfaction among Air Asia passengers

Statement 1: Service quality influenced by passengers

Strongly Strongly
Agree Agree Neither Agree nor Disagree Disagree Disagree

6 20 4 0 0

Fig 4.1
Interpretation: It is found from the study that 20% of the respondents strongly prefer the service
quality and 67% of respondents also prefer service quality while flying. So Air Asia Company
should give importance to improve the quality of the services to attract more and existing
customers.

Disagree
0%

Neither Agree nor

Disagree
13% Strongly Agree
Strongly Disagree
20%
0%

Agree
67%

Fig 4.1 (b)

Data Analysis: The above table and fig 4.1 shows the service quality experienced by passengers.
Where, 6 of 30 have strongly agreed , 20 have just agreed and remaining neither agree nor disagree.
Statement 2: Service quality differs from Airlines Service Provider to Airlines Service Provider.

Strongly Strongly
Agree Agree Neither Agree nor Disagree Disagree Disagree

4 23 3 0 0
Fig 4.2

Interpretation: It is found from the research that 13% of the respondents strongly think that service
quality differs from Airlines Company to Company. And 77% of the respondent’s perception is
that different Airlines Company provides different types of services. So the Airlines Company
should focus on Customer services.

Q:2 Strongly
Q:2 Disagree
Disagree
Q:2 Neither Agree Q:2 Strongly Agree 0%
0%
nor Disagree 13%
10%

Q:2 Agree
77%

Fig 4.2 (a)

Data Analysis: The above data is collected to analyse the difference among airline companies
service. Where, 4 of 30 have strongly agreed , 23 have just agreed and remaining neither agree nor
disagree.
Statement 3: Airlines service Providers should pay more attention on the quality of the services.

Neither Agree nor Strongly

Strongly Agree Agree Disagree Disagree Disagree

12 13 5 0 0
Fig 4.3

Interpretation: It is seen from the study that about 85% of respondents want that the quality of the
service that Airlines Companies are providing should be improved. So quality is the issue that
customers provide importance in terms of satisfaction. To satisfy the customers companies should
improve the quality of the service.

Disagree Strongly Disagree

0% 0%

Neither Agree
nor Disagree
17% Strongly Agree
40%

Agree
43%

Fig 4.3 (a)

Data Analysis: the above data is collected to analyse the attention to be paid for service quality of
customers. Where,12 have strongly agreed, 3 have agree and remaining neither agree nor disagree.
Statement 4: Satisfaction level depends on in-flight service quality.

Strongly
Strongly Agree Agree Neither Agree nor Disagree Disagree Disagree

7 15 6 2 0
Fig 4.4

Interpretation: The services which the Airlines service providers are giving in the flight it has an
important impact in terms of customer satisfaction. Nearly 75% of respondents think that their
satisfaction depends on In-flight service quality.

Strongly Disagree
0%
Disagree
Neither Agree 7% Strongly Agree
nor Disagree 23%
20%

Agree
50%

Fig 4.4 (a)

Data Analysis: the above data is collected to analyse the satisfaction level by service provided for
the customers. Where,7 have strongly agreed, 15 have agree and remaining neither agree nor
disagree.
Statement: 5: I prefer online ticket booking while purchasing ticket.

Strongly
Strongly Agree Agree Neither Agree nor Disagree Disagree Disagree

6 15 7 1 1
Fig 4.5

Interpretation: From our study we have found that 70% of the respondents prefer online ticket
booking while purchasing ticket.

Disagree Strongly Disagree

4% 3%

Strongly Agree
Neither Agree nor 20%
Disagree
23%

Agree
50%

Fig 4.5 (a)

Data Analysis: the above data is collected to analyse the preference of buying ticket online.
Where,6 have strongly agreed, 15 have agree and remaining neither agree nor disagree.
OBJECTIVE 3:

To analyse the marketing strategy of Air Asia.

a) What are the marketing strategies of Air Asia

Target Market and Solving A Problem.

AirAsia’s overall business and marketing strategy started here. Taking the success stories of
Ryanair and Easy jet back in Europe as their vision, AirAsia team convinced that the low-cost
airline is the way forward. They decided to focus and roll in Asia. They believe they can change
and disrupt the entire airline industry via democratising their pricing model. They truly believed
that this business model is going to work wonders to their benefits and advantage in Malaysia and
Asia. The reasoning is very simple. They believe that Asian people love to travel. Not just love,
they are crazy about travelling actually. The only thing that is blocking this traveler-wannabe from
going full steam ahead is because of the cost of the airline ticket which is too unreasonable at that
time. So, with the no-frills airline business model, it will not only complement and solve the
existing travellers’ problem on costs but also complement the marketing agendas by making it easy.
AirAsia solved a big

Easy-To-Understand Branding:
Once AirAsia identified their target markets and problems to be solved, the rest of the marketing
and branding parts are going to be easy. Then they decided to name the brand as AirAsia. With this
AirAsia as the brand name, indirectly they were announcing to the world that they are going after
the Asia airline market. They want to conquer Asia. The name itself explains everything. That is
why the right name is extremely important for a business.
Tagline.

AirAsia needs another statement to support the AirAsia brand value proposition so that the people
can understand everything about them without having to explain further or again and again. Now
Everyone Can Fly, was chosen as AirAsia’s tagline to support the brand. To me, their chosen
tagline is brilliant. Without having to opt for a long-winded and complex set of words, they just
came up with just a simple yet meaningful tagline. Despite just one simple sentence, it clearly says
to me that as a potential customer I can travel anywhere I want, safely, without a hassle and just
have to pay a reasonable amount of money for it.

Direct Touch To Consumers Via Online Marketing.

I was quite surprised when AirAsia was at their infancy stage many years ago that they decided not
to sell tickets via agents. Instead, they opted for the utilisation of technologies. Today, ticketing
agents are no longer relevant. People, like me, prefer to purchase tickets online. AirAsia already
embarking the internet and e-commerce way of doing things before any other companies. They
realised early that the internet and e-commerce are truly a game changer tools that can’t be ignored.
Look at them today, look at how you check the prices today, look at how to buy your tickets today,
look at how you do your check-in today and look at how you purchase your in-flight food today.

Social Media Utilisation.

While the rest of the organisations out there want to stay ‘corporate’ and utilising social media
without any sense of direction, AirAsia, on the other hand, is doing it differently. They want to
become as ‘human’ as possible. So what they do is they established and grow their very own
community. Social media channels are being used wisely, to establish conversations and at the
same time quietly collecting feedbacks. This way, direct interactions with their own community
who also their fans and customers are made easy. Talking and chatting over social media is
encouraged. Even Tan Sri Tony Fernandes and Datuk Kamarudin Meranun are avid users of social
media. They interact with their friends, staffs and even customers directly. They make red-tapes
history.

Email Marketing.

AirAsia realises that these social media channels are regularly changing algorithms from time to
time. Today, it is no longer easy and cheap to do online marketing over social media as before.
That is why they are growing their community and make it as big as possible. Once the community
is huge, they will no longer depend on social media to stretch the reach of each social media
posting. What they just do is simple, they convert social media followers into subscribers to their
weekly newsletter. When these people become a subscriber, team AirAsia can easily blast out any
announcement or promotions directly to each and every customer directly.

b) What are the promotion strategies for Air Asia?

The promotion strategies of Air Asia and Malaysia Airlines are different but the purpose is alike.
Air Asia is issuing free tickets and competing in ticket prices setting. For increasing the sales of
the flights ticket, Air Asia usually will give out free seat or even super low price ticket during the
non-peak season.

c) What are the objective of Air Asia?

The Objectives Of Marketing Strategy Of Airasia

Based on Air Asia Berhad annual report, following are the marketing objectives that set by the
organization:

➢ To be the lowest cost short haul airline in every market.

➢ To continuously launch new routes under Air Asia.
OBJECTIVE 4:

To analyse the operational efficiency of Air Asia

a) What are the low-cost high-efficiency approach to sustainability of Air Asia?

AirAsia’s low-cost high-efficiency approach to sustainability. We keep our aircraft flying as much
as possible, while minimising time on the ground. Utilisation of each aircraft is currently more than
13 hours per day on average. And we aim to turn around each aircraft between sectors within 25
minutes.

We streamline our operations, making processes as simple as possible. We operate a single type of
aircraft, which means training for pilots, cabin crew, engineers and operations personnel can be
standardised; our aircraft carry single-class seating; and we use standard operating procedures
aligned with industry best practices across the Group as a means of achieving consistency of service
and safety.

This has allowed us to provide air services in a way that is responsible, cost-efficient and safe. For
instance, we continually revisit our systems and processes – especially in the area of flight
operations – to find new and better ways to reduce costs, which are in themselves positive for the
environment. Many of these relate to fuel efficiency. Fuel makes up about 40 per cent of our total
cost. By minimising our use of fuel we maintain lean operations while making sure that low fares
do not translate into high environmental costs. And while we have been conscious of this from day
one, we continually look for new and better ways to achieve this goal. The key to our success is
small improvements per flight that result in large annual savings.
b) Is AirAsia a joint venture?

The airline is a joint venture with Tata Sons holding 51% stake in the airline and AirAsia Berhad
holding 49% stake. AirAsia India commenced operations on 12 June 2014 with Bangalore as its
primary hub.

c) Is AirAsia a subsidiary of India?

AirAsia is the first foreign airline to set up a subsidiary in India and the company marked the Tata
Group 's return to the aviation industry after 60 years, having ceded Air India in 1946. As of June
2020, AirAsia India was the 4th largest carrier in India, after IndiGo, SpiceJet and Air India, with
a market share of 7.2%.