Challenges of Hong Kong Essay

Topic Challenges of Hong Kongs climb armed supporter airlines cladding today This essay examines the challenges faced by Hong Kongs honorable divine wait on airlines nowadays. Air transportation serves not only to encourage trade and development in the tourism industry in Hong Kong, alone also to emend peoples mobility and to form a modern society. In this essay, full portion airline is defined as traditional airline that provides go such as allocated seat, transfer of baggage between flights, blankets and meals. Full service airlines suffer several challenges in the aspect of production cost for ontogenesis advanced organization and challenger with affordable airlines nowadays. For this reason, I would like to check out the challenges in depth according to the above aspects and figure out viable solutions.Challenge 1 Low-cost airline invasionIn bran-new-fashioned years, the airline industry has undergone a revolution ca exampled by the growth in population of low-co st carriers, which atomic number 18 airlines that provide discounted fares and no-frills service to passengers, and the growth in the number of low-cost carriers ca subroutined a huge growth in departure and arrival of regional aerodromes and established a brand new grocery in short-break tourism. While low-cost airlines are gaining an increased market share within the industry, the full-service airlines are struggling. Numbers of full-service airlines are on the boundary line of bankruptcy, and some even had to sign agreements or mergers to ensure their long-run existence.To make out with the no-frills airlines, some full service airlines had set up their witness low-cost subsidiary, but a few of them ended up in operational losses, forced to sell their subsidiary. Pels (2008) describes full service airlines as aiming to say quality, whereas no-frills carriers aim to keep costs low. He states that although it whitethorn be difficult for low-cost airlines to earn money on r ag sales, they may gain profit on board by sell snacks and beverages, and from the airdromes depart from or land on. Moreover, most low-cost airlines promote themselves for their transparentness in the pricing system, thus keeping air travel unco affordable, despite the high cost of jet fuel.As low-fare airlines invades the airline industry, full service airlines will not only encounter fare pressure, but will also have to progressively fight with the upstarts for takeoff, landing slots and admission space in Hong Kong or other crowded airports in Asia. In order to encounter this challenge, the airline should emphasize on the operate it provides, and stress on improving their flights operations both in the air and on the ground, utilizing optimum flight management procedures and providing customers with sustainable products and services, in order to struggle with the emergent trend of low-cost airlines.Challenge 2 Managing destinationsFull service airlines use the Hub a nd Spoke System, which enables passengers to travel from one smaller city to another(prenominal) smaller city via a hub or even two hubs. This system not only service more cities at a subvert cost, but also maximizes passenger loads, thus saving fuels. Low-cost airlines use simple point-to-point net profits, as they operate streets which originate or end at a major airport, which allows them to enter any market they see fit. Thus, if the route turns out to be unprofitable, the low-cost carrier will close it down. concord to Pels (2008), full service airlines cannot easily withdraw from a market, even if it is scarce profitable, because a full-service carriers link between a hub airport and spoke airport serves many different indirect markets. If this route is unlikable because of the decrease in load factor due to competition on the market between the hub airports and spoke airports, passengers and profits, in all other markets victimization this link are lost.According to a s urvey by the bon ton Barclaycard, a relatively large number of the business concern travellers (71%) used low-cost airlines for business trips. This indicates that passenger preferences may be shifting to low-cost, less service airlines. The low-cost carrier attracts passengers from the full-service airlines, thus causes competition and reduces load factors and profits for the full-service airlines. In order to bat this problem, full-service airlines can offer more low-fare tickets on short-haul routes, and use short-haul routes as feeders for the global markets where they make most profits. Even though the competition for indirect travellers is very intense, they will allow conventional airlines to maintain a large network with relatively high frequencies.Challenge 3 enthronisation on the advanced technologyWith the rapid development in advanced technologies and popular use in mobile gadgets, reserving a seat on the plane is further one click ahead. Simply by seek the website of their desired airline, customers will be able to get all the pertinent information they will need to plan their trip, including the list of fares in particular(prenominal) dates and allocation of the seats on the aircraft. In addition, systems like automatic airport check-ins and ticketless air travel are getting more popular, and will be the future trends in the airline industry. Therefore, in order to provide the passengers availableness in online reserves and to build up the image of a green airline, investments are needed to be made on improving the systems.Acknowledging the numerous benefits provided by the internet, airlines have been investing resources in their websites. Standing (2000) claimed that the Web has changed from pushing firms and services to pulling clients into value-added opportunities that a company provides. Airlines do not only compete among each other, they also compete with online travel agents such as Expedia. Thus, to solve this challenge, the air lines should entice travellers to book their trips via the airlines website, by providing extra benefits to customers when they procure online.ConclusionTo summarize, the challenges that full service airlines in Hong Kong faced are the rising of low-cost airlines, the managing of destinations and huge investments made on developing and improving the systems for reservation and check-ins. It is crucial for airlines to understand that when passengers purchase an airline seat, they are not just paying for a seat in the aircraft they also purchase the service behind. In order to attract a consumers attention, benefits or attributes of using full service airlines and low cost carriers such as price, safety, network connections, and service will be important.REFERENCESCooper C. and et al. (1999) Tourism Principles and Practice, 2nd ed., Longman issue Harlow. Driver, J. (1999). Developments in airline marketing practice. Journal of Marketing Practice employ Marketing Science, 5 (5), 13 4150. Law, R. & Leung, R. (2000). A Study of AirlinesOnline Reservation operate on the Internet. Journal of Travel Research, 39 (2), 202-211. Moiseiwitsch, J. (2012). Budget airlines find Hong Kong a tough market to crack. In South China Morning Post. Retrieved November 6, 2014 from http//www.scmp.com/business/companies/article/1404255/budget-airlines-find-hong-kong-tough-market-crack Pels, E. (2008). Airline network competition Full-service airlines, low-cost airlines and long-haul markets. Research in Transportation Economics, 24 (1), 68-74. Sigala M. (2003) The Information and Communication Technologies Productivity Impact on the UK Hotel Sector, International Journal of Operations & Production Management, 23(10), 1224-45. Wang, J. & Lee, S. (2014). Asias Budget Airline Invasion. In Bloomberg Businessweek. Retrieved November 6, 2014 from http//www.businessweek.com/articles/2014-02-13/asias-budget-airline-invasion-cathay-pacific-defends-hong-kong