European Full Service Network Car-riers (FSNC) strategic diversification. Strategies for enhancing growth and performance
This dissertation was written as part of the Executive MBA at the International Hellenic University. The airline industry has been playing a vital role for the global economy since its early days. The correlation with trade growth, tourism and key country specific stra-tegic priorities has been strong. European Airline market was dominated by flag carri-ers, thoroughly controlling routes, prices, connectivity and frequency. Governments have used their carriers for achieving both internal and external strategic goals at the expense of the passengers they have been carrying. Those days are long gone though and European aviation has undergone an extensive deregulation which gave room for a significant increase in operating carriers and most importantly, boosted exponential-ly the number of passengers carried, inflicting ticket prices a serious blow. European full service network carriers, found themselves amidst a fierce competition emanating from the LCCs, the Middle Eastern carriers, their US rivals and the arising Asiatic airline industry, struggling to preserve their market share and profitability. Based on the above considerations and voids identified in the literature, this study examines the Eu-ropean airline industry in detail and identifies strategies that will assist European FSNCs accelerating their growth. The methodology employed regards the in-depth analysis of secondary, publicly available data and existing archival data and documen-tation. Primary analyses are conducted using widely known and reliable strategic tools, such as PESTEL analysis, Porter’s 5 Forces model and SWOT analysis. This analysis re-sulted in identifying three strategies that could improve carrier’s competitiveness. First one was the option of investing in Indian airline industry. Second, was the option of further consolidation within European region, with this particular strategy being identi-fied as the most appropriate one and third suggested strategy was the one of exploring potential partnership at equity level with Middle Eastern carriers. The study contributes to existing literature by: 1) making available a detailed, thorough and up-to-date analysis that decision makers can use for extracting their own results and design their own strategies, 2) identify the three most appropriate strate-gies that could improve competitive positioning of European FSNCs, 3) increase visibil- ity to the challenges that European FSNCs are facing, so that regional and governmen-tal authorities can most effectively deal with one of the most important industries of the EU region. This study is the result of my own personal work which was completed with the exceptional support and guidance of my supervisor Dr. Lida P. Kyrgidou.