AVIATION SECTOR

By Rajesh Kumar S

By GVSK Chaitanya

Production Function &

Market Analysis

VIT Business School

Vellore & Chennai Campus:

VIT University was established in 1984 by well-known educationalist and

former parliamentarian, Dr. G. Viswanathan, Founder and Chancellor.

Dr. V. Raju Vice Chancellor, Dr. Anand A. Samuel, Pro-Vice Chancellor.

Chennai Campus is in Vandalur-Kelambakkam Road.VIT University has more

than 17 Bachelor’s and 32 Masters’ programmes, 29000 (including 1000 foreign

students from 44 countries) and 4000 faculty members

Accreditation:

The National Assessment and Accreditation Council (NAAC) of the University

Grants Commission (UGC) has accredited the university with a 'A'.

The Institution of Engineering and Technology (IET), and the Energy Institute,

UK have audited the teaching-learning processes at VIT and accredited the

programmes in 2004, with the highest validity of five years

Programmes at VIT are accredited by the Institution of Engineers, India (IEI).

The Accreditation Board for Engineering and Technology (ABET) of the USA

accredited the Civil, Mech, CSE, biomedical, ECE, EEE programmes.

VIT Business School, under the aegis VIT University has created a niche for

itself as an institution promoting excellence in management education and research

with Dr. M J Xavier as its Executive Director.

Contents

VIT Business School ....................................................................................................................................... 2

Vellore & Chennai Campus: .......................................................................................................................... 2

Introduction to Aviation Sector .................................................................................................................... 5

Introduction to Airline Industry: ................................................................................................................... 6

Market Share Analysis .................................................................................................................................. 8

Segments Airline Industry Depends ..................................................................................................... 9

Capital Labour Ratio ................................................................................................................................... 13

Airline Economics .................................................................................................................................. 13

JET AIRWAYS ............................................................................................................................................... 16

MARKET SHARE (DOMESTIC) ...................................................................................................................... 16

REVENUE (Domestic services) : ................................................................................................................... 17

REVENUE (International services): .............................................................................................................. 18

Turnover Vs Employees Ratio: .................................................................................................................... 19

WEKA Prediction: ........................................................................................................................................ 20

SPSS Forecasting: ........................................................................................................................................ 21

Partners of Jet Airways: .............................................................................................................................. 22

More Information about Jet Airways: ......................................................................................................... 23

Specifics in Jet Airways: .............................................................................................................................. 24

CONCLUSION: .............................................................................................................................................. 25

Company Analysis: ...................................................................................................................................... 26

Network Across The World ........................................................................................................................ 28

BAR GRAPH REPRESENTATION OF TURNOVER ............................................................................. 28

BAR GRAPH REPRESENTATION OF TURNOVER AND EMPLOYEES OF QATAR AIRWAYS ... 29

LABOUR CAPITAL RATIO OF QATAR AIRWAYS ............................................................................. 30

DIFFERENT SECTORS IN QATAR AIRWAYS ..................................................................................... 31

Qatar Duty Free....................................................................................................................................... 31

Al Maha Services .................................................................................................................................... 32

Qatar Aircraft Catering Company ........................................................................................................... 32

Qatar Airways Cargo .............................................................................................................................. 33

Qatar Aviation Services .......................................................................................................................... 33

The Qatar Distribution Company ............................................................................................................ 34

Internal Media Services .......................................................................................................................... 34

Hamad International Airport ................................................................................................................... 35

Qatar Executive ....................................................................................................................................... 35

AWARDS AND REWARDS TO QATAR AIRWAYS 2014 .................................................................. 36

Conclusion .................................................................................................................................................. 37

Introduction to Aviation Sector

“Aviation is the practical aspect or art of aeronautics, being the design,

development, production, operation, and use of aircraft."

Airlines Of India ( Domestic)

1. Air India

2. IndiGo

3. Jet Airways

4. SpiceJet

5. Go Air

6. King Fisher (Suspended)

7. Air Asia

8. Jagson

9. Vistara. (Introducing)

Airlines in India ( International)

1. British Airways

2. Qatar Airways

3. Singapore Airlines

4. Emirates

5. Etihad Airlines

6. Qantas Airlines

7. American Airlines

8. Malaysian Airlines

9. Thai Airways

10. Kuwait Airlines.

Introduction to Airline Industry:

Airline Industry is a system of transportation

Part of Aviation industry

Moving people and goods

Utilizing the airways

One of the only true global businesses

This Airline Industry has almost a big network

84% of International traffic

240 member airlines

188 countries

Economic and Social Impact of Airline Industry:

2.5 billion Passengers

5.5 million Airline Employees

9.5 million Airline Supply chain Employees

18 million Indirect Tourism Jobs

Freedom of Air

1: Right to fly across a country’s territory without landing

2: Right to land for non-traffic purposes

3: Right to carry passengers and goods from OWN’s country to another

4: Right to carry passengers and goods from another country to one

OWN’s

Cargo Division:

Airline Industry Features :

Market Share Analysis

Factors That Airline Industry Depend On:

Segments Airline Industry Depends

Market Share in Different Countries

Global Air Traffic Trends

Domestic Airline Turnover:

Fuel Growth Effect On Airline Cargo Industry

Profit And Loss Over Four Years

Over a last Four Years Airline Industry Has Suffered A lot Of Loss And

less Profit because of increase in fuel charges and global crisis and also

airline companies has to decrease the prices accordingly to attract more

passengers for cover their loss.

Low cost Carriers Across Asian Countries And Penetration Rate

Capital Labour Ratio

Airline Economics

Chief Characteristics of the Airline Business

Capital Intensive

Unlike many service businesses, airlines need more than storefronts and

telephones to get started. They need an enormous range of expensive

equipment and facilities, from airplanes to flight simulators to

maintenance hangars. As a result, the airline industry is a capital-

intensive business, requiring large sums of money to operate effectively.

Most equipment is financed through loans or the issuance of stock.

Increasingly, airlines are also leasing equipment, including equipment

they owned previously but sold to someone else and leased back.

Whatever arrangements an airline chooses to pursue, its capital needs

require consistent profitability.

High Cash Flow

Because airlines own large fleets of expensive aircraft which depreciate

in value over time, they typically generate a substantial positive cash

flow (profits plus depreciation). Most airlines use their cash flow to

repay debt or acquire new aircraft. When profits and cash flow decline,

an airline's ability to repay debt and acquire new aircraft is jeopardized.

Labor Intensive

Airlines also are labor intensive. Each major airline employs a virtual

army of pilots, flight attendants, mechanics, baggage handlers,

reservation agents, gate agents, security personnel, cooks, cleaners,

managers, accountants, lawyers, etc. Computers have enabled airlines to

automate many tasks, but there is no changing the fact that they are a

service business, where customers require personal attention. More than

one-third of the revenue generated each day by the airlines goes to pay

its workforce. Labor costs per employee are among the highest of any

industry

Pilot A best Job In Comparsion With Other Sector :

JET AIRWAYS

MARKET SHARE (DOMESTIC)

"Market share is the percentage of a market defined in terms of either

units or revenue accounted by a specific entity."

“Market share is said to be a key indicator of market competitiveness.”

Indigo leads,Followed by Jet Airways 21% in the second place.

REVENUE (Domestic services) :

The Revenues of the companies are shown in BILLIONS.

Jet Airways is in the first position even though the market share is less.

REVENUE (International services):

Revenue has been specified in US dollars (Billions)

Emirates is the successful airlines in the world with highest revenue.

Jet Airways Revenue is 12 times less than Emirates Airways.

Turnover Vs Employees Ratio:

The turnover vs. employees ratio shows the efficiency of the company.

It clearly shows the company profitable by efficiently using their human

resource.

Jet Airways has 13256 Employees as per 31st March 2014.

Jet Airways Revenue per year.

WEKA Prediction:

The WEKA forecast has been done from the one month data of NSE.

The forecast shows that the share value of jet airways will keep on

increasing for a particular period of time.

The Chart shown here shows the variation of share price from the year

2005 to 2014.

It has been increased in years between except the year 2009.

The chart was presented by Moneycontrol.com.

SPSS Forecasting:

The SPSS forecast has been done using the 3 months historical data of

NSE india.

The lag values are Price and Quantity.

The predicted accuracy is nearly equal to 80%.

Partners of Jet Airways:

A code share agreement is an aviation business arrangement where two

or more airlines share the same flight i.e. Sharing in this sense means

that each airline publish and market the flight under its own airline

designator and flight number as part of its published time table/schedule.

A frequent-flyer partners (FFP) is a loyalty program offered by many

airlines. Typically, airline customers enrolled in the program accumulate

frequent-flyer miles (kilometres, points, segments) corresponding to the

distance flown on that airline or its partners.

More Information about Jet Airways:

Specifics in Jet Airways:

Jet Lite

Jet Konnect

Jet Privilege

Jet Mobile

Jet Spark

Jet Boutique

Jet Kids

Jet Konnect airline operates scheduled services connecting metropolitan

centres in India. Originally operated under its own name Jetlite, it began

to trade as JetKonnect in 2012. It will be phased out by the end of 2014

as part of Jet airways' plans to reposition itself as a uniform full-service

operation.

Jet Kids is for the children boarding in the age between 03 to 12

Jet Boutique services the women boarding the airlines by shopping

during the travel.

Jet Mobile connects the customers through mobile phone and all the

transactions can be done through SMS.

CONCLUSION:

As per the domestic market share of airlines in India

Indigo leads all other airlines with a Market share of 26%

Jet Airways has 21% in the second place.

The Revenue of Jet Airways is in the first position even though the

market share is less.

Emirate is the successful airlines in the world with highest revenue.

Jet Airways Revenue is 12 times less than Emirates Airways.

Jet Airways has 13256 Employees as per 31st March 2014.

The forecast shows that the share value of jet airways will keep on

increasing for a particular period of time.

Company Analysis:

QATAR AIRWAYS

Top 10 Airline Companies

Emirates

Qatar Airways

Singapore Airlines

ANA All Nippon Airways

Asiana Airlines

Cathay Pacific Airways

Etihad Airways

Garuda Indonesia

Turkish Airlines

Qantas Airways

Qatar Airways Company Q.C.S.C. (Arabic: القطرية , l

atariyah ) operating as Qatar Airways, is the state-owned flag

carrier of Qatar.

Founded In 22 November 1993 & Commenced operations

20 January 1994

Akbar Al Baker (CEO) OF QATAR AIRWAYS

The airline also won the Best Airline in the Middle East for the

eighth time in the Skytrax World Airline Awards.

Headquartered in the Qatar Airways Tower in Doha the airline

operates a hub-and-spoke network, linking over More than 125

international destinations across from its base at Hamad

International Airport, using a fleet of more than 100 aircraft.

Akbar Al Baker (CEO)

Network Across The World

As of July 2014, Qatar Airways serves 144 points worldwide

In July 2013, Qatar Airways became FC Barcelona's primary shirt

sponsor

THE TOTAL NO OF FLEETS IS-- 135

ORDERED FLIGHTS IS—294

BAR GRAPH REPRESENTATION OF TURNOVER

Emirates 9%

Qatar Airways 15%

Singapore Airlines

11%

ANA All Nippon Airways

23%

Asiana Airlines

11%

Cathay Pacific Airways

5%

Etihad Airways 9%

Garuda Indonesia 6%

Turkish Airlines 9% Qantas Airways

2%

Turnover(millions)

This Bar graph Representation shows the turnover ratio of top 10 airline

companies compared with different airline companies across the world

in this Qatar Airline Company Occupies 15% of Total Turnover

Next Top Company is ANA All Nippon Airways Which Japan Airways

Owns 23% of Total Turnover

BAR GRAPH REPRESENTATION OF TURNOVER AND

EMPLOYEES OF QATAR AIRWAYS

Bar graph Representation shows the turnover and the Employees Ratio

of All Top Airline Companies in this Qatar Airways owns the Second

Position And First Position is Occupied by ANA All Nippon Airways

with 1570 Million USD

0 10000 20000 30000 40000 50000 60000

Emirates

Qatar Airways

Singapore Airlines

ANA All Nippon Airways

Asiana Airlines

Cathay Pacific Airways

Etihad Airways

Garuda Indonesia

Turkish Airlines

Qantas Airways

Emirates

Qatar Airways

Singapore

Airlines

ANA All Nippon Airways

Asiana Airlines

Cathay Pacific

Airways

Etihad Airways

Garuda Indones

ia

Turkish Airlines

Qantas Airways

Employees 49950 30000 14240 32884 10000 29800 10656 15274 18,882 33265

Turnover(millions) 622 1000 760 1570 760 338 610 372 600 150

BAR GRAPH

LABOUR CAPITAL RATIO OF QATAR AIRWAYS

This Labour Capital Ratio Is the Company Salaries Details in this we

can determine the exact salary the company pays to a employee

accordingly with their own capital value

This can be calculated by Capital value /Total no of Employees

In given chart Emirates owns the First Position and 2nd

is owned by

Etihad Airways and QATAR Airways owns the 4th

position in the top 10

airline companies

0

0.001

0.002

0.003

0.004

0.005

0.006

0.007

0.008

Labour capital ratio

Labour capital ratio

DIFFERENT SECTORS IN QATAR AIRWAYS

The atar irways Group provides everything you’ll need for a smooth

journey including airport ground services, onboard catering, private jet

travel, and more.

Qatar Duty Free

One of the fastest growing duty free retailers in the world. Qatar Duty

Free, located at Hamad International Airport, is a subsidiary of Qatar

Airways, the national carrier of the State of Qatar.

Al Maha Services

Fast track your way through the airport.

Experience a true taste of Arabian hospitality with our unique meet and

greet service. Whether departing, arriving, or in transit, your Al Maha

representative will ensure your time on the ground is as seamless as your

time in the air.

Qatar Aircraft Catering Company

Award-winning catering and fine dining

Qatar Aircraft Catering Company (QACC) provides exclusive catering

services to Qatar Airways and other airlines that service Hamad

International Airport

Qatar Airways Cargo

One of worlds the fastest growing cargo networks Qatar Airways Cargo

(QAC) is a well-established force in the Middle East and one of the

fastest growing cargo networks in the world. Based at Hamad

International Airport, QAC uses the latest automated tracking

technology to meet the Ever Growing demands for cargo services.

Qatar Aviation Services

Ground support for all airlines at Hamad International Airport.

Qatar Aviation Services (QAS) is responsible for providing ground

handling services at Hamad International Airport for Qatar Airways and

a host of other airlines. This covers everything from porters to baggage

handlers/loaders, aircraft cleaners to equipment operators, and drivers to

customer service agents.

The Qatar Distribution Company

The Qatar Distribution Company (QDC) is the only licensed retail

distributor of wines and spirits in Qatar. The store has wide range of

beverages that can be purchased by licensed hotels and qualifying

private individuals.

Internal Media Services

Advertising at Hamad International Airport

Internal Media Services is responsible for all advertising the Airport

Hamad International Airport

Your Gateway to the World

Comfort Convenience Choice These are the things that matter most to

today’s traveler and is at the heart of Hamad International Airport,

atar irways’ new home

Qatar Executive

Personal Attention onboard our private jet division.

Qatar Executive provides luxurious, private jets for business and

pleasure travel. The service enables travellers to book an aircraft in as

little as four hours before departure and check-in 10 minutes prior to

take-off.

AWARDS AND REWARDS TO QATAR AIRWAYS 2014

World's Best Business Class Skytrax World Airline Awards

World's Best Business Class Airline Lounge Skytrax World Airline Awards

Best Airline in the Middle East Skytrax World Airline Awards

Best Business Class Best in Business Travel Awards

Best Business Class in the Middle East Best in Business Travel Awards

Best Airline in the World for International Travel Best in Business Travel Awards

Business Airline of the Year UK Business Travel Awards

Conclusion

In a relatively short time, Qatar Airways has grown to more than 140

destinations worldwide, offering unmatched levels of service excellence

that have helped excel the award-winning carrier to become best in the

world.

Travel by air has reached the point where it is now taken for granted in

all corners of the globe. With a larger number of passengers and more

choice available in the skies today, airlines looking to maintain or grow

their position in the marketplace must provide high-quality service with

ever-increasing efficiency.

Since the airline’s relaunch in 1997, atar irways has earned many

awards and accolades, becoming one of an elite group of airlines

worldwide to have been awarded a 5-Star rating by Skytrax.

Part of this excellence is offering you a 5-Star travel experience online at

the newly-relaunched qatarairways.com where you can book flights and

search for information on the airline.

Qatar Airways takes corporate social responsibility very seriously. We

are leading new-generation fuel research and giving back to the

communities that we serve.

I Hereby submit my market analysis on Qatar airways in the different

field like market turnover and labour capital ratio and its different

sectors according to my knowledge.

Author Details : Rajesh Kumar S VIT Business School, Chennai Campus

rajesh1893@gmail.com

Mob: 9566972942.

GVSK CHAITANYA 14MBA1084 VITBS

MAIL ID : gajavalli.saikrishnach@vit.ac.in

For Further details Contact:

Dr P James Daniel Paul, Professor, VIT- BS, Chennai, jamesdanielpaul.p@vit.ac.in Tel: +91 44 3993 1040 HP: +91 98402 94590