This case study analysis is about the issues that arise in Qantas airlines. Qantas airlines are the largest airline industry in context with their fleet size and third oldest airline in whole world. The company was founded in November 1920 by Hudson Fysh, Paul McGinness and Fergus Mc Master. It is connected not only within domestic area but also across global world. Qantas airlines are known as “ The spirit of Australia” which has innovative sense of lifestyle, food, culture and involved in duty free shopping. The airline industry also got awarded as the Eco- Pioneer Airline of the year in 2013. In context with their organization structure they always followed matrix management structure.
What was the issue faced by Qantas airlines behind safety and security ?
What was the issue faced by Qantas airlines because of high cost and high wages?
Issue 1:- The issues faced by Qantas airlines was safety and security as well as high cost and high wages which led to a major criticism. In context with safety and security, customers were not able to trust the company because there were people who used to carry bombs with them which was major issue in terms of their failure. Due to this, customers were not travelling with their airline as they find other airways more safe and secure. The company suffered this failure in context with their expansion also. Due to issues in terms of safety and been secure there was political instability which led to such security problems and affected the growth of business. Passengers faced emergency landings as well as in flight injuries which led to a major negative image on their reputation. The airline industry not only faced the safety issue in context with terrorism attack but also in flight injuries. In accordance with recent case happened in Qantas airlines was the emergency landing which led to broken bones as well as spinal injuries of all passengers due to which no one was able to trust their airlines. The airline industry also faced issue in their safety terms when oxygen cylinder got exploded due to which serious problem caused to all passengers and plane had to divert.
Solution 1:- To tackle all security and safety issues so that their industry need not face any kind of failure they implemented some security measures like trace detection of all passengers as major issue was related to terrorism due to which customers were not able to trust the company so they established the concept of trace detection. There will be a method of random detection during the time of departure which can be of any customer if company would have any doubt on their passengers. In context with their terminals, both domestic and international. In domestic terminals non passengers have no access and security screening is done and in the case of International terminals non passengers are not allowed to enter controlled area of all Australian international terminals. Due to such security issues , they also introduced body scanners which all passengers had to deal with. The body scanners were able to detect non metal items also and if any passenger declines that they will not pass through any kind of body scanner then they will not be allowed to enter . It is recommended that Qantas airlines should focus on their safety and security issue because its a major failure which they will face and also affect their reputation so they should initiate the concept of advanced technology detection also of all passengers instead of selecting only random passengers whom they have any doubt because it is not possible that terrorists would be of this kind of personality only.
Issue 2:- Qantas airlines also faced the issue in relation to high cost and high wages. It was analysed that the reason behind the failure of airline industry was high cost and high wages which created loss in their industry. The cost structure and wage structure affected their airlines as well as it was a disfavour from passengers also. In comparison to other airlines Qantas had a high cost structure due to which they had to struggle a lot to overcome their losses. They increased their price both in the case of domestic as well as international as wanted to tackle their fuel costs but passengers didn't wanted to pay such high price and due to these issues their economy was getting affected. The major issue the company was facing in fuel cost due to which they had to increase their cost also which led to many controversies. There are many top airline companies who are providing best services but charging fair prices from all people but in case of Qantas airlines they were charging high because they had to overcome the issue of their fuel cost also. It is analysed that Qantas airlines total fuel costs was around $871 million which led to an increase in their costs by $1066 million and due to this it led to high wages also. Their airline industry is considered as the most expensive industry in terms of prices and in accordance with today's time period of COVID-19, no one would want that they pay high prices when they are getting similar services from other airline companies.
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Solution 2:- By charging high prices from passengers won't lead them to success and will increase their reputation. The company should always focus on charging fare prices from customers so that the company don't reach at the stage of failure because of issue regarding high costs being paid . It is the responsibility of company to tackle the fuel prices and because of this the company should not charge price from customers.
Recommendations:- It is also recommended that instead of focusing on on their issues regarding safety and security they should start thinking about their cost issues also. There are many passengers who will be ready to pay high price also as they want to travel in top airline industry only but at the same time there are many customers who will not pay unfair prices because of company facing issue in their fuel costs and they will not travel in their airline industry.