Local Airline Industry-5 Forces of Porter
Local Industry-Air line Industry
Air Lines: PIA, Air Blue, Shaheen and Aero Asia.
Competition rivalry within the industry:
There is little competition in the local routes between the airlines of Pakistan. But PIA still holds monopoly over its rival because of its strong market position and strong support by the government. Although in the international routes PIA faces tough competition from the rest of the air lines.
Threats of new entrants:
There is low threat of new entrants in this industry, because it needs huge investments and because of the economic condition no one will invest in the airline industry of Pakistan. Although there was an article in the news paper that a new air line is coming soon in Pakistan which is Air Indus, but it is still just a rumour.
Threat of substitute :
There are few threats of substitute of air lines on the local level as some people would prefer the substitute of PIA like Air blue, Shaheen and Aero Asia in the local routes because of their affordable rates. In the international routes PIA have many foreign substitute air lines. Bargaining power of customers:
Because of low competition in the market there is no bargaining power of customer in the industry. Air lines are charging high fares especially PIA because of its strong monopoly.
Bargaining power of suppliers:
In this industry bargaining power of supplier is more than customer because there are no specific rules and regulations from government side that’s air line companies are charging too much from customers.
Air Lines: PIA, Air Blue, Shaheen and Aero Asia.
Competition rivalry within the industry:
There is little competition in the local routes between the airlines of Pakistan. But PIA still holds monopoly over its rival because of its strong market position and strong support by the government. Although in the international routes PIA faces tough competition from the rest of the air lines.
Threats of new entrants:
There is low threat of new entrants in this industry, because it needs huge investments and because of the economic condition no one will invest in the airline industry of Pakistan. Although there was an article in the news paper that a new air line is coming soon in Pakistan which is Air Indus, but it is still just a rumour.
Threat of substitute :
There are few threats of substitute of air lines on the local level as some people would prefer the substitute of PIA like Air blue, Shaheen and Aero Asia in the local routes because of their affordable rates. In the international routes PIA have many foreign substitute air lines. Bargaining power of customers:
Because of low competition in the market there is no bargaining power of customer in the industry. Air lines are charging high fares especially PIA because of its strong monopoly.
Bargaining power of suppliers:
In this industry bargaining power of supplier is more than customer because there are no specific rules and regulations from government side that’s air line companies are charging too much from customers.