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    Star Air

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    habiburachman_ts
    Star Air was an Indonesian low-cost carrier established in 2001 that operated until 2005. It initially had 6 domestic routes and 4 Boeing 737 aircraft. By 2003 it had implemented an online reservation system and was planning regional expansions. However, in 2005 rising fuel costs led to a price war that Star Air could not withstand, and it was forced to cease operations and lay off 600 employees. Its main competitors at the time included Batavia Air, Lion Air, and Adam Air, which pursued similar low-cost business models focused on price-conscious domestic travelers.

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    Star Air

    Uploaded by

    habiburachman_ts
    278 views8 pages
    Star Air was an Indonesian low-cost carrier established in 2001 that operated until 2005. It initially had 6 domestic routes and 4 Boeing 737 aircraft. By 2003 it had implemented an online reservation system and was planning regional expansions. However, in 2005 rising fuel costs led to a price war that Star Air could not withstand, and it was forced to cease operations and lay off 600 employees. Its main competitors at the time included Batavia Air, Lion Air, and Adam Air, which pursued similar low-cost business models focused on price-conscious domestic travelers.

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    STAR AIR

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    Star Air was an Indonesian low-cost carrier established in 2001 that operated until 2005. It initially had 6 domestic routes and 4 Boeing 737 aircraft. By 2003 it had implemented an online reservation system and was planning regional expansions. However, in 2005 rising fuel costs led to a price war that Star Air could not withstand, and it was forced to cease operations and lay off 600 employees. Its main competitors at the time included Batavia Air, Lion Air, and Adam Air, which pursued similar low-cost business models focused on price-conscious domestic travelers.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    278 views8 pages

    Star Air

    Uploaded by

    habiburachman_ts
    Star Air was an Indonesian low-cost carrier established in 2001 that operated until 2005. It initially had 6 domestic routes and 4 Boeing 737 aircraft. By 2003 it had implemented an online reservation system and was planning regional expansions. However, in 2005 rising fuel costs led to a price war that Star Air could not withstand, and it was forced to cease operations and lay off 600 employees. Its main competitors at the time included Batavia Air, Lion Air, and Adam Air, which pursued similar low-cost business models focused on price-conscious domestic travelers.

    Copyright:

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    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 8

    STAR AIR:

    PRICING STRATEGY IN THE AIRPLANE INDUSTRY

    Agung Mahendra Habiburachman Muhamad Ibnu Fauzi Nurliyasari Rangga Tri Raeros Ria Agustriana Busra

    LOW COST CARRIER


    Designed to lower operating cost and implemented through three elements 1. Point to point flight system 2. Lower labor cost 3. Elimination of some passengers facilities

    HISTORY
    2001
    Established You Are Our Star 6 domestic routes (exhibit 1) Having relationship between Hotel, Travel and Airlines interlink as a service business Ale Sugiharto want to make Star Air the most wanted aviation enterprise with a good professional management Operate four Boeing 737-200s with 118 seats capacity

    2003
    Implemented reservation system in travel bureau and other service users through Galileo system Planned to serve a number of regional routes as its expansions effort

    2004
    Opened a flight strip of Jakarta Kuala Lumpur

    2005
    Tariff war during the increasing of avtur prices Stopped all its operational activities 600 employees were fired 5 of 7 airplanes were rented and the rest owned by company

    COMPETITORS

    Batavia Air

    Lion Air

    Established in 1999 Strongest competitor Low priced focused 24 units Boeing and purchasing additional 60 units Purchase Boeing with newest technology Targeting passenger with abroad destination who were price conscious

    Start operation in January 2002 Owned 36 units airplane with 150 flights and 29 local destination Trust us to fly EDI and online administration Focused on domestic and price conscious

    Adam Air

    Established in 2003 20 destinations and 6 units of fleet Low ticket price Targeting people who satisfied at simplicity Win award as LCC airplane

    CONCLUSION
    Star Air was stopped all of their operational activities in June 2005 Tariff war during increasing of avtur price Star Air cant survive during the tariff war Daily operational cost was exceeding company income

    SOLUTION
    Firms survival Cover variable cost and some fixed cost for short run objectives Decrease operational cost For long run objectives the firms has to giving added value Company strategy Allocated 5% - 10% free seats Offer lowest ticket price Change their airplane to the economic one Maximize their plane capacity LCC Point to Point flight system Lower labor cost Elimination of some passengers facilities during the flight

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