1 Value Chain

Question 1

most important economies

increasing economy lead to lower marginal costs

Answer 1

Economy of technology:

• newer plane have a lower CASK
• smaller plane are able to fly longer distances

Economy of scale:

• bigger plane have a lower CAKS
• bigger airport have a lower PAX (larger catering facility)

Economy of scope: network

-bigger airline offer more OD with comparably few legs

Economy of density:

-airline dominating a hub has comparably higher market shares. big hubs offer improved and optimized services (lounge, shopping)

Question 2

structure and element of the aviation service chain

where the air ticket turnover goes to?

Answer 2

Aircraft manufacturer 7%

Aircraft leasing company 30%

airports 26%

ground service 6%

tech. support 6%

Computer reservation system 15%

Airline 3%

Question 3

how airline spend you airfare

Answer 3

30% fuel

20% salary

16% ownership costs

14% government, fees, taxes

11% maintenance

1% profit

Question 4

success factor of airports

Answer 4

size and Pax no., depending on

• local demand
• role of airport in the airline industry (we need an hub carrier, doesn’t matter who. direct access to the world is important)
• cost structure (procurement, outsourcing, air traffic control)

Pragmatic cooperation & outsourcing

Non aviation revenues

reasonable ration in balance sheets

development perspectives, political legitimation

Question 5

strategic success factor for airlines

Answer 5

Economies of scale and scope

• through internal network effect
• through integration or strategic alliances

Cost efficiency and brand quality

good financial ratio

-equity / total capital, share of leased plane, SLF, CASK, RASK

Question 6

strategic success factor for aircraft manufacturer

Answer 6

• technology (fuel efficiency & reliance) –> constant development
• product platforms
• timed renewal

Question 7

what does influence a business model

Answer 7

airport development

airlines routes, alliances

technology