American Airlines Swot Analysis Paper

1384 Words 6 Pages
AMERICAN AIRLINES GROUP INC. COMPANY ANALYSIS
HISTORY
American Airlines Group (AAG) Inc. was formed on December 9, 2013, after a merger of AMR Corporation, the parent company of American Airlines and US Airways Group, the parent company of US Airways (Statista.com, 2016). AAG Inc. is a publicly traded company with NASDAQ Ticker, AAL. It operates flight services on both the domestic and long haul routes. In 1983, AAG established a subsidiary known as AMR to provide aviation services to other airlines. The company also launches AMR eagle as a feeder service to create a network. During early 80’s, the company expanded its operations hub to strengthen its services. During 1990’s, the AAG expanded its facilities to include more international airports.
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flies more than 350 destinations in 50 countries, including the USS. It serves Latin America, Europe, and Asia Pacific. AAG headquartered in Fort Worth, Texas. It employed around 118,500 at the end of 2015. In December 2015, the company recorded revenues of $40,990 million. This is a 3.9% decrease over 2014. But the operating profit is up 46% to $6,204 million from 2014. The net profit increased from $2,882 million in 2014 to $7,610 million in 2015 (American Airlines Group Inc., 2016). The merger of AMR and US Airways Group created AAG Inc. as the world largest airlines.
SEGMENTATION
AAG Inc. operates with many subsidiaries and one of the main subsidiaries is American Airlines. AAG Inc. has two segments in terms of its passenger flights. Mainline serves international and regional serves domestic. In FY2015, the Mainline earned $29 billion, the regional earned $6.5 billion, another revenue is $4.8 billion and cargo earned $760 million. AAG Inc. serves four regions; Domestic, Latin America, Atlantic, and Pacific. In 2015, Domestic region earned $28.7 billion, Latin America earned $5.5 billion, Atlantic earned $5.1 billion and Pacific earned $1.5 billion. (American Airlines,
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offers special pricing deals or promotions, online through promotional websites such as Groupon, TripAdvisor, and coupons.com. Some of the ongoing promotions are the going rates for adventure; 35% off from Avis and Budget rental plus bonus miles, the AA advantage elite program; Elite is qualifying dollars for travelers who uses some of the MasterCard’s and offers 30,000 miles to people traveling to Europe (Airlines.wanderbat.com, 2016).
COMPETITIVE ADVANTAGE
The AAG 's biggest competitor is Delta airlines. Both companies compete with price match, product, promotions, and destinations. But one big advantage with American airlines group is their comfort seating such as legroom space in the economy class.
SWOT ANALYSIS
Strength
• Extensive operational network
The extensive operational network allows AAG to access a diverse range of customers and markets (American Airlines Group Inc., 2016)
• Robust frequent flyer program
Customer loyalty, increased by frequent flyer program (American Airlines Group Inc., 2016)
• Strong alliances provide a competitive edge over other airlines.
• Strong brand Image (mbaskool, 2016).
• They have one of the best onboard services (Schmidt, 2016).
Weakness
• Limited number of suppliers for aircraft and parts (American Airlines Group Inc., 2016)
This creates inefficiency in operation, in another word AAG cannot control suppliers.
• Unfunded employee pension benefits (American Airlines Group Inc.,

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