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Essay text:
Legacy carriers developing low-cost offshoots
Customers: 661 million domestic passengers. Expected growth in business customers
Degree of vertical integration: mixed; some have low cost reservation systems, alliances with regional and international airlines as well as hotels. Hedged fuel costs. Sabre Holdings and Galileo International connect airlines with travel agents. No mention of airlines employing in-house catering.
Learning curve effects: not a factor in this industry
Ease of exit/entry: aircraft, terminals, infrastructure and staffing are expensive
Technology/Innovation: R & D essential in creating efficiencies and reducing expenses with turn-around times, fuel costs, reservations etc
Product Characteristics: diverse; customers can receive top end service through to low cost travel and ongoing international hook-ups...
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