Supplier concentration in a few hands. Due to few suppliers in market, this has increasing the bargaining power of supplier. Aircraft supplier could be the one who gaining most bargaining power as there are only two in operation, Boeing or Airbus. The other supplier such as fuel supplier, merchandise supplier, or food supplier may be depend on market condition.
High Switching Cost. Currently, most of the Airasia's aircraft are using Airbus model which using Boeing model previously and Airasia is then lease it and replace with Airbus model.If in case Airasia may wish to switch to Boeing again, the cost of training employee in operating the aircraft feature is high. Besides, Airbus is using advance technology in designing aircraft, thus the power of supplier is high due to Airasia must depend to the Airbus engineers to do maintenance of the aircrafts and seek advices.
Relative insignificant influence of buyer to supplier. This is due to Airbus is a UK based aviation company and their customer may come from around the world. Airasia may be small portion of customer whom orders 200 aircraft from the total 9,113 aircraft order from other customer of Airbus. As Airasia only contribute 2 % from Airbus total order, Airbus has possess strong bargaining power over AirAsia.
Read more: http://www.ukessays.com/essays/management/porters-5-forces-analysis-on-air-asia-management-essay.php#ixzz3mEm7eE7G
Supplier concentration in a few hands. Due to few suppliers in market, this has increasing the bargaining power of supplier. Aircraft supplier could be the one who gaining most bargaining power as there are only two in operation, Boeing or Airbus. The other supplier such as fuel supplier, merchandise supplier, or food supplier may be depend on market condition.High Switching Cost. Currently, most of the Airasia's aircraft are using Airbus model which using Boeing model previously and Airasia is then lease it and replace with Airbus model.If in case Airasia may wish to switch to Boeing again, the cost of training employee in operating the aircraft feature is high. Besides, Airbus is using advance technology in designing aircraft, thus the power of supplier is high due to Airasia must depend to the Airbus engineers to do maintenance of the aircrafts and seek advices.Relative insignificant influence of buyer to supplier. This is due to Airbus is a UK based aviation company and their customer may come from around the world. Airasia may be small portion of customer whom orders 200 aircraft from the total 9,113 aircraft order from other customer of Airbus. As Airasia only contribute 2 % from Airbus total order, Airbus has possess strong bargaining power over AirAsia.Read more: http://www.ukessays.com/essays/management/porters-5-forces-analysis-on-air-asia-management-essay.php#ixzz3mEm7eE7G
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