Question

Why the Threat of substitutes on Air Asia is moderate? What are the factors? Please explain in at least 3 factors in more detail.

Answer 1

The threat of substitue is moderate for airasia because of easy to switching as there are about fifty nine low cost air line which is operatig in the airline inustry .Therefore it is easy for the customers to have a substitute and choose the alternative according to thier satisfaction.Also as all the airline provide the same service to the customers that is to send them from,thier origin point to destination point.Therefore the threat of substitue is always moerate for the airasia .Others factors like

Threat of new entrants - the customer loyalty is weak as the competition among the airline competitor is increasing which is also having low fare and this has caused the customer of air asia to have a shifting in their loyalty

Rivalry among the existing firms .The no. of competitor is high an air asia is now facing rivalry competition with about 59 other airline which have low fare like JAL express, air arabia , tiger airwyas etc .

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