Sky Air Inc Case Study Answers

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Ans 1) Environmental analysis on the macro factors towards SkyWest Inc.
In order to figure out and understand about SkyWest inc. I used PEST analysis to analyze the macro factors. The case study shows that many airlines had faced problems and were highly affected by the economic downturn and recessions. Some major airlines company also got bankrupt such as Midwest Airlines. However Midwest airlines were later purchased by the TPG Capital. SkyWest also had an issue regarding fuel. Even though the costs of fuel was included amongst the partners there was a problem of its availability and because of this problem they had to limit the number of flights how much ever the company could support and afford. Moreover, there was a big issue of economic
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Those two major aircrafts are regional jets and ATR turboprops. For short to medium haul flights, Turboprop was used which was able to land on shorter runways. On the other hand, regional jets serviced longer-haul flights which were being used increasingly. Ans 2) Porter’s 5 Force Analysis
After doing the analysis of SkyWest inc., here are the results followed below:
 Threat of entry (Moderate)
It actually has a low threat for the new entries to join the market. So, this makes difficult for the new entries to come to the market. SkyWest inc. started their own low-cost airlines which are United’s Ted and Delta’s Song. Due to this the major carriers faced lot of loss in revenues from their low-cost competitors. They have invested a large amount on planes and hangars which also makes hard for the new entries. Moreover, there are regulations after the 9/11 attack and it makes more hard for the new entries to enter the market.

 Threat of Substitute Products or Services (Low)
The regional airline industry can be considered to have substitutes such as low-cost carriers, cars, buses and trains. This threat can be considered to be low because of the time constraints they pose.

 Bargaining Power of Buyers

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