Egyptair's Strategy

Table of Contents

EXECUTIVE SUMMARY 4

I. OVERVIEW OF THE AIRLINE INDUSTRY 5

A. HISTORY 5

B. FIVE FORCES INDUSTRY ANALYSIS 5

C. CUSTOMER PROFILES AND MAIN COMPETITORS 6

II. COMPANY PROFILE 9

A. COMPANY OVERVIEW 9

B. PESTEL ANALYSIS 10

III. SALES STRATEGY 14

A. INCREASE DISTRIBUTION VIA THE INTERNET AND REDUCE SALES OFFICES 14

B. EMPHASIZE AFTER-SALES SERVICES. 14

C. STAR ALLIANCE MEMBERSHIP. 14

IV. TECHNOLOGY STRATEGY 15

A. INTRODUCTION OF NEW AIRCRAFTS 15

B. INTERNET TECHNOLOGY AND MOBILE SERVICES 15

C. MOVE TO A BIGGER TERMINAL 16

V. POLITICS AND THE IMPACT ON EGYPTAIR’S STRATEGY 16

A. THE POLITICAL INTERFERENCE FROM THE GOVERNMENT IN THE COMPANY 16

B. CHANGE OF STRATEGY AFTER THE EGYPTIAN REVOLUTION 17

VI. EVALUATION AND POSITIONING 18

RECENT PERFORMANCE 18

STRATEGIC POSITIONING 18

COMPETITIVE ADVANTAGE 19

VII. RECOMMENDATIONS 19

REFERENCES: 21

Executive Summary

Egyptair is the major airline of Egypt. Its main hub is the Cairo airport and it is owned entirely by the Egyptian government. Since joining the Star Alliance in 2007, Egyptair has made a number of strategic moves whose objectives are not only to increase revenues but also to expand its operating territory and improve the quality of the services it offers.

The airline industry has become famously competitive since the industry was deregulated around the world starting in the 1970s. Although Egyptair still enjoys a monopoly among as a legacy airline in Egypt, particularly at the Cairo airport, it still faces competition from budget carriers at smaller airports. Ironically, despite their monopoly the company is also faces certain operating challenges inherent to government ownership.

The company derives the majority of its revenue from tourism and leisure travel and is therefore especially vulnerable to regional conflicts and political events that may affect tourism. Because they also have a cost structure that is very rigid, they need to be able to forecast sales