Answered You can hire a professional tutor to get the answer.
Complete 14 page APA formatted essay: Theory and Research in Strategic Management: Swings of a Pendulum.Porter’s threat of new entrants determines the prospect of new competitors entering the airlin
Complete 14 page APA formatted essay: Theory and Research in Strategic Management: Swings of a Pendulum.
Porter’s threat of new entrants determines the prospect of new competitors entering the airline industry. This force also considers the likelihood of new industry entrants underscoring the profits enjoyed by established businesses within the industry (Rothwell & Kazanas 2003, p. 85). In the modern world, the airline industry is extremely saturated to the extent that there is a rather minimal space for newcomers to enter the airline market. The greatest huddle is the cost of entering the industry. The airline industry is perhaps one of the most expensive industries because of the cost implications of security and safety measures, manpower, customer service, and leasing and purchasing aircraft. Other entry huddles include stringent government restrictions and intense capital costs for new airline development. While the deregulation of a majority of domestic airlines in the 20th century significantly lowered the entry barriers into the airline industry, this move has not made a substantive difference in reducing entry costs. There is profound competitiveness within the industry, particularly in the EU. The entry of new airlines has profoundly reduced the market share of established airlines coupled with increased competition, pricing freedom, which constrains the industry’s profitability. In the event of cheap borrowing, it is extremely likely that the prospect of new airlines entering the industry increases. In essence, the threat of new entrants in the airline industry is relatively low since costs involved in establishing and managing airlines deter entry.
