The porter five forces for the Airline industry in general are explored in the following. The bargaining power of the buyers is found to be higher owing to the various options that select from the premium class air travelling services and also there are service offering for the low-cost air travelling services. These services are offered by the airline companies such as Qantas and Virgin Airlines. These service providers are found to offer the services that are increasing with the buyer’s purchasing power.
The bargaining power of the suppliers is generally lower for the airline industry. This is based on the larger number of suppliers that offer the services which are found to be similar. When compared with the Qantas power, it is lower owing to the fact that many of the major airlines within the industry are Virgin Airlines (Budd and Ison, 2016).
There is the threat of the substitute that is generally lower for the companies. This is owing to the fact there is a need for a lot of infrastructural costs that are involved in this process and there is increasing need of the governmental legislations.
There is high level of competition within the existing firms. These are crucial with respect to the airlines industry. Qantas and Virgin airlines are strong players in the domestic markets. There is high level of competition within the airline companies that face the losses of the operation. The competitive situation is found to high in the airline industry as it is significant. Each and every airline is competing with each other to acquire the market share. In the analysis of the airline industry, Qantas and Virgin Airlines are found to be competing with each other and the competition is evident in terms of the price cuts in these services. These competitive scenarios are detrimental and cause significant losses to the Qantas. The industry condition is not good and they are further impacted by the airline industry (Budd and Ison, 2016). There are high levels of competition from the international markets, and they are the British Airlines, Ryanair to name a few. Hence, there is no real market leader in Airline industry as all the companies are barely operating (Budd and Ison, 2016).
There is the threat of newer entry which is based on the fact that the newer players require high level of investment in the infrastructure of the airline company. This is very difficult to perform. These are the main results of the porter analysis. The companies need to find ways to leverage their presence in the current times.