Code Sharing Agreements With Domestic And International Airlines Sabre

code sharing agreements with domestic and international airlines
SABRE ticketing system
Presence at most airports
American Eagle regional routes
Lucrative route structure

Threats
thin operating margins favoring low fare carriers
public acceptance of low fare carrier concept
customer quality perception of low fare carriers that exceeds the majors
prolonged slow economy favors low fare carrier pricing structure
segmentation of the industry into business and discount carrier classifications
high fuel prices
government intervention

Chapter 2 Conclusion
The intense competition in the airline industry along with thin operating margins and fuel costs along with other expenditures existed before the dramatic events of September 11th. The strengths of American Airlines in being the world's largest airline provides it with a huge customer base that is familiar with the airline. This represents the core of all marketing, customer retention as well as the foundation to attract new customer trial. Customer retention and utilization represent the primary advantage that American Airlines enjoys and needs to utilize to protect its position as well as build upon. The American Eagle division provides the company with an additional customer convenience marketing tool via intra city (regional) destination traffic. In order to accomplish the preceding objective the company must increase its quality of service from its current 11th position to increase customer satisfaction. The 50/50 mix of business and leisure travelers that comprise its customer base has remained relatively constant and business class travelers contribute heavily to profits as a result of the higher fares paid for first class and business class seating (American Airlines, 2005).
Utilization of target marketing with concentration on the frequent flier base represents American's primary advantage to capitalize upon since is does not compete in a low fare platform. Tightened restrictions on fares has closed a lot of the gap, thus consumer perceptions in the higher income categories represent a huge customer base for American to capitalize on in stealing customers from the other majors as a primary strategy and eroding the fringe low fare customer base as a secondary target market. Technology in terms of software advances along with code sharing, peaking and American's route and connection structures offer convenience. Increased international travel also helps the company as a result of its global routes and destinations. American's size, reach, reputation, fleet and presence at over 154 airports reinforces the preceding (American Airlines, 2005).