Amerijet International Airlines: Porter’s Five Forces
Question
Please do Porter's five forces that are highlighted in blue in Outline.
Based on your Trade Project Outline, choose an article that is at least 5 pages long but not so long that you don't want to read it. Be sure to collaborate with your partner so you can discuss which direction you are going. More importantly, make sure you don't do the same article. The idea is to have several citations to work with.
1. criterion is linked to a Learning Outcome Provide Full Citation: Using the APA style guide, please provide the full citation for the resource used.
2. criterion is linked to a Learning Outcome Give 2-3 sentences describing the main topic of the article. After reading your article, give a brief description (2-3 sentences) of what your annotated bibliography is about.
3. Give 5 Highlights of the article: In your own words, provide 5 highlights of the article clearly explaining the concept and its relevance to the research. Please be comprehensive so that you can use this to your Trade Research Project.
a.
b.
c.
d.
e.
4. In your own words, clearly state the situations, challenges or problems so that you can clearly identify and analyze it.
5. In your own words, discuss the situation, challenge or problem. If possible, identify key stakeholders, locations, specific items that would help you find clarity.
6. Give a conclusion.


Solution
Amerijet International
Airlines: Porter’s Five Forces
Amerijet International Airlines has
remained competitive since its inception in 1974 by David Basset. Six B757
freighters were added to the airline’s fleet in 2020 as part of the airline’s
comprehensive development and modernization strategy. The company operates a
dedicated freighter fleet from its principal hub at Miami International Airport
to numerous locations throughout Mexico, Europe, Central America, and the
Caribbean. In addition, it has nearly 45 years of expertise in the airline
sector. As a result, this study will discuss Porter’s five forces in relation
to Amerijet International Airlines.
Rivalry Organization
Amerijet International has been, for
the past four decades, moving freight by multiple methods not only in America
but by other means. Although the company offers essential services to its
consumers, it still experiences rivals in the market. From the analysis of
airlines in the United States, it is significant that within the airline
industry, the intense competitive rivalry for a number of reasons, such as low-cost
carriers, tight regulations, and high operating expenses within the industry. Organizations
such as allied aviation, interGlobe Air Transport Limited, and Emirates
SkyCargo, among other newcomers in the airline industry, have been competitive
rivals of Amerijet International (Adamkasi, 2021). In what seems to be a
strategy to remain competitive in the market over rivalry organizations,
Amerijet airline decided to offer a diverse range of ocean, air, and a multitude
of land services to facilitate the need of its consumers to travel. Although
Amerijet has been changing its market strategy to remain relevant, the low-cost
carrier’s rivalry has resulted in the airline sector being competitive with
Amerijet across the globe.
New Market Entry
The new market’s entry greatly
impacts Amerijet International Airlines because the company needs huge capital
investment to enter the market. This means that Amerijet will face tremendous
barriers such as high start costs and regulations when entering a new market. The
strict regulations in the high airline industry that include significant passenger
safety and well-being protection can be extremely costly for the company when
entering a new market. But compared to other airline companies, Amerijet
International Airlines’ brand name is likely to give it a productivity
advantage when entering the new market. Another barrier that the company will
experience when entering the new market is that it will need a high infusion of
capital, indicating that the dimension of entering the new market for the
airline industry like Amerijet is quite high (Damian Brett, 2022). Given that
Amerijet needs to expand its business market, there is a need to embrace the
low-cost carriers’ business model as that will make it enter the new market and
maintain its competitive advantage. Also, apart from that, the company can make
its services more unique than its competitors in the market. For instance,
recently, Amerijet has begun operating on the SmartKargo platform, which is essential
when entering a new market as it will help serve the consumers’ time.
Substitute Players
The airline industry in the United
States has been not mostly at threat from substitutes compared to the
developing world. In most cases, clients rarely use train buses or trains
for travel, as they do in the United States. This indicates that in the U.S,
flying is a natural phenomenon for consumers; thus, there is a minimal impact
of substitutes effect. Although there are limited substitute players for
Amerijet International Airlines, Bally cargo substitutes the company because it
only transports goods via passenger aircraft. Furthermore, it is clear that
Bally Cargo limits the company to get more passenger because of the time
because security standards and checks for passengers and cargo takes time. In
addition, the shipping cargo can be first and cheap, thus acting as a
substitute player to the Amerijet, something that will make the company record
low returns on investment.
Suppliers
From the analysis of Amerijet
International Airlines, the power of suppliers in the airline industry is
significant because the three inputs that airlines use, such as aircraft,
labor, and fuel, are all affected by the external environment. For example, the
fluctuation in the price of fuel has because of geopolitical and other factors
has been affecting Amerijet airline. Therefore, with the increase in the price
of fuel, the airline company needed to increase the airline fees in order to
remain profitable. But in the past years, Miami-based Amerijet has been
changing its fuel surcharge calculation method to an indexed model (Adamkasi,
2021). The reason for doing this by the company is to ensure that Amerijet
maintains its airline fee as that will make it maintain its consumers in the
market. But given the power of suppliers in the airline industry, Amerijet
needs to have a significant strategy that will make it remain consistent with
its airline fee to avoid fluctuation in the market, making it lose some of its
consumers.
Buyers
With technological advancement, the airline industry
has become more competitive as apart from the entry of low-cost carriers into
the market, tight regulation has affected the airline industry. Given the
proliferation of online ticketing and distribution systems and the entrance of
low-cost carriers into the market, Amerijet decided to launch a new cargo
platform to ensure its consumers get excellent services. Its service’s digital
transformation and automation have made Amerijet outshine its competitors such
as ABX Air, Kalitta Air, and Cargojet. Also, the partnership with SmartKargo
made the company a comprehensive and seamless cargo management solution.
Recommendation
For the company to remain competitive
in the market, it is essential to maintain good relationships with its
consumers, vendors, and partners. It should also ensure it is innovative to deliver
its services to the consumer first, as that would help build a solid
relationship based on trust. More importantly, the airline should ensure it
maintains its strength of providing multi-modal transportation and logistics
sets to maintain its competitiveness in the market.
References
Adamkasi. (2021, June
08). Porter’s five (5) Forces - American Airlines Group. Retrieved April 18,
2022, from https://www.porteranalysis.com/porters-five-5-forces-american-airlines-group/
Damian Brett. (2022). Amerijet expansion
underway as b757s begin operations. (2022, March 09). Retrieved April 18, 2022,
from https://www.aircargonews.net/airlines/freighter-operator/amerijet-expansion-underway-as-b757s-begin-operations




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