6043 Module Two
The Airbnb case struck me as fascinating for several reasons. They are relatively new to the ‘hotel’ industry; they started meagerly; they’ve grown exponentially; and they have issues others in the ‘hotel’ industry do not.
—
The case: Airbnb: Disrupting the Hotel Industry
Beginning on page 73 of the text and continuing to page 109 of the text, this case discusses the growth of Airbnb from its founding in 2008 to having over 7 million listings in 220+ countries and regions.
The founders originally started with providing places to sleep during big major events (SXSW and the 2008 Democratic National Convention). However, the company did not have a sustainable business model until it obtained help through a Silicon Valley incubator. That experience prepared Airbnb to successfully enter the global hotel industry with its disruptive business model. In 2019 Airbnb was valued at $31 billion dollars even though still a private firm.
https://news.airbnb.com/about-us/
For general information, this link will take you to the Airbnb home page. As you scroll through this page, note the founders, the fast facts, and their timeline.
As part of your discussion, think about a PESTAL model, Porter’s Five Forces Model, co-opetition, the VRIO Framework and other concepts presented in Chapters 3 and 4 of the text. As always, you do not need to address each of these concepts in your discussion. You cannot within your limited time frame. You should touch on how one major concept from these two chapters applies to Airbnb through external analysis and internal analysis.
You must follow all of the guidelines for discussion as described in the instructions link and in your syllabus to receive full credit.
The post should be a minimum of 500 words. The thoughts and opinions expressed in your thread must be substantiated by research and literature. A minimum of two, reputable, external sources are required in the post. All in text references should be in correct APA style format and the references should be in APA format at the bottom of your post.
All original threads should: 1. Bring clarity to the issues being discussed. 2. Raise new and novel (yet relevant) points. 3. Rationally defend your stated position.
Each initial post in the class should be considered a mini case analysis. Pages 460-465 of the text is a review of How to Conduct a Case Analysis. In your initial post and in your responses to your classmates, you should follow the steps of the strategic management process. You should include (1) analysis of the problem; (2) proposal of one or more alternate solutions; and (3) justification for which solution you believe is best and why.
Chapter 3
External Analysis: Industry Structure, Competitive Forces, and Strategic Groups
© 202
1
McGraw Hill. All rights reserved. Authorized only for instructor use in the classroom.
No reproduction or further distribution permitted without the prior written consent of McGraw Hill.
Because learning changes everything.®
1
Learning Objectives
Generate a PESTEL analysis to evaluate the impact of external factors on the firm.
Differentiate the roles of firm effects and industry effects in determining firm performance.
Apply Porter’s five competitive forces to explain the profit potential of different industries.
Examine how competitive industry structure shapes rivalry among competitors.
Describe the strategic role of complements in creating positive-sum co-opetition.
Explain the five choices required for market entry.
Appraise the role of industry dynamics and industry convergence in shaping the firm’s external environment.
Generate a strategic group model to reveal performance differences between clusters of firms in the same industry.
© McGraw Hill
How External Factors Impact a Firm
General environment:
Managers have little control.
Macroeconomic factors are included.
Examples: interest, exchange rates, etc.
Task environment:
Managers can influence.
Includes the composition of strategic groups.
Includes the structure of the industry.
© McGraw Hill
3
The PESTEL Model
Groups environmental factors into six segments:
Political.
Economic.
Sociocultural.
Technological.
Ecological.
Legal.
A straightforward way to scan, monitor, and evaluate external factors.
© McGraw Hill
4
The Firm within Its External Environment, Industry, and Strategic Group, Subject to PESTEL Factors
Exhibit 3.1
© McGraw Hill
5
Political Factors
Processes and actions of government bodies that influence the firm can be shaped through:
Lobbying.
Public Relations.
Contributions.
Litigation.
Political and legal forces are closely related.
Political pressure often results in changes in legislation.
© McGraw Hill
For example, hotel chains and resort owners have challenged Airbnb in courts and lobbied local governments, some of which passed regulations to limit or prohibit short-term rentals. Local residents in New York, San Francisco, Berlin, Paris, and many other cities are also pressuring local governments to enact more aggressive rules banning short-term rentals because they argue that companies such as Airbnb contribute to a shortage of affordable housing by turning entire apartment complexes into hotels or transforming quiet family neighborhoods into all-night, every-night party hot spots.
6
Economic Factors
Largely macroeconomic.
Affect economy-wide phenomena.
Examples include:
Growth rates.
Levels of employment.
Interest rates.
Price stability.
Currency exchange rates.
© McGraw Hill
Occasionally, boom periods can overheat and lead to speculative asset bubbles. In the early 2000s, the United States experienced an asset bubble in real estate. Easy credit, made possible by the availability of subprime mortgages and other financial innovations, fueled an unprecedented demand in housing. Real estate, rather than stocks, became the investment vehicle of choice for many Americans, propelled by the common belief that house prices could only go up. When the housing bubble burst, the deep economic recession of 2008–2009 began, impacting in some way nearly all businesses in the United States and worldwide.
7
Sociocultural Factors
Society’s cultures, norms, and values:
Are constantly in flux.
Differ across groups.
Trends should be monitored.
Demographic trends:
Population characteristics.
Age, gender, family size, ethnicity, sexual orientation, religion, and socioeconomic class.
© McGraw Hill
In recent years, for example, a growing number of U.S. consumers have become more health-conscious about what they eat. This trend led to a boom for businesses such as Chipotle, Subway, and Whole Foods. At the same time, traditional fast-food companies McDonald’s and Burger King, along with grocery chains such as Albertsons and Kroger, have all had to scramble to provide healthier choices in their product offerings.
The most recent U.S. census revealed that 55 million Americans (16.4 percent of the total population) are Hispanic. It is now the largest ethnic group in the United States and growing fast. On average, Hispanics are also younger and their incomes are climbing quickly. This trend is not lost on companies trying to benefit from this opportunity. For example, MundoFox and ESPN Deportes (specializing in soccer) have joined Univision and NBC’s Telemundo in the Spanish-language television market. In the United States, Univision is now the fifth most popular network overall, just behind the four major English-language networks (ABC, NBC, CBS, and Fox). Likewise, advertisers are pouring dollars into the Spanish-language networks to promote their products and services.
8
Technological Factors
Application of knowledge:
New processes and products.
Innovations in process technology:
Lean manufacturing, Six Sigma quality and biotechnology.
Innovations in product technology:
Smartphones, wearable devices, high-performing electric cars.
Advances in artificial intelligence and machine learning.
© McGraw Hill
As discussed in the Chapter Case, Airbnb launched a radical process innovation of offering and renting rooms based on a business model leveraging the sharing economy. If one thing seems certain, technological progress is relentless and seems to be picking up speed.
9
Ecological Factors
Broad environmental issues:
Natural environment.
Global warming.
Sustainable economic growth.
The relationship between organizations and the environment can be:
Adversarial.
Can provide business opportunities.
© McGraw Hill
Unfortunately many business organizations have contributed to the pollution of air, water, and land, as well as depletion of the world’s natural resources. BP’s infamous oil spill in the Gulf of Mexico destroyed fauna and flora along the U.S. shoreline from Texas to Florida. This disaster led to a decrease in fish and wildlife populations, triggered a decline in the fishery and tourism industries, and threatened the livelihood of thousands of people.
10
Legal Factors
Official outcomes of political processes:
Laws.
Mandates.
Regulations.
Court decisions.
Many industries have been deregulated.
Airlines, telecom, energy, and trucking.
Legal factors often coexist with or result from political will.
© McGraw Hill
Consider how several European countries and the European Union (EU) apply political and legal pressure on U.S. tech companies. European targets include Apple, Amazon, Facebook, Google, and Microsoft—the five largest U.S. tech companies—but also startups such as Uber, the taxi-hailing mobile app. Europe’s policy makers seek to retain control over important industries ranging from transportation to the internet to ensure that profits earned in Europe by Silicon Valley firms are taxed locally. The EU parliament even proposed legislation to break up “digital monopolies” such as Google. This proposal would require Google to offer search services independently as a standalone company from its other online services.
11
Industry vs. Firm Effects
Industry Effects:
Describe the economic structure of the industry.
Elements in common to all.
Entry and exit barriers, number and size of companies, and types of products and services offered.
Firm Effects:
Attribute firm performance to the manager’s actions.
More important than industry effects.
© McGraw Hill
12
Industry, Firm, and Other Effects Explaining Firm Performance
Exhibit 3.2
Source: Data from O. Bandiera, A. Prat, and R. Sadun (2012), “Management capital at the top: Evidence from the time use of CEOs,” London School of Economics and Harvard Business School Working Paper.
© McGraw Hill
13
Industry and Industry Analysis
Industry:
Group of incumbent companies.
Relatively similar suppliers and buyers.
Similar products and services.
Industry analysis, a method to:
Identify an industry’s profit potential.
Derive implications for a firm’s strategic position.
© McGraw Hill
14
Strategic Positioning
A firm’s ability to:
Create value for customers (V).
While containing costs (C).
Goal.
To generate a large gap between:
The value the firm’s product or service creates.
The cost required to produce it.
V minus C.
© McGraw Hill
15
The Five Forces Model
The Five Forces Model helps strategic leaders understand:
The profit potential of different industries.
How they can position their firms to gain and sustain competitive advantage.
Two key insights about this model:
Competition is viewed more broadly in the five forces model.
Profit potential is a function of the five competitive forces.
© McGraw Hill
16
Porter’s Five Forces Model
Exhibit 3.3
Source: Porter, M. E. (2008, Jan.). “The five competitive forces that shape strategy,” Harvard Business Review.
© McGraw Hill
Porter derived two key insights that form the basis of his seminal five forces model:
1. Rather than defining competition narrowly as the firm’s closest competitors to explain and predict a firm’s performance, competition must be viewed more broadly, to also encompass the other forces in an industry: buyers, suppliers, potential new entry of other firms, and the threat of substitutes.
2. The profit potential of an industry is neither random nor entirely determined by industry-specific factors. Rather, it is a function of the five forces that shape competition: threat of entry, power of suppliers, power of buyers, threat of substitutes, and rivalry among existing firms.
As a rule of thumb, the stronger the five forces, the lower the industry’s profit potential—making the industry less attractive for competitors. The reverse is also true: the weaker the five forces, the greater the industry’s profit potential—making the industry more attractive.
17
Threat of Entry
The risk that potential competitors will enter an industry:
Lowers industry profit potential.
Increases spending among incumbent firms.
Entry barriers:
Economies of scale.
Network effects.
Customer switching costs.
Capital requirements.
Advantages independent of size.
Government policy.
Credible threat of retaliation.
© McGraw Hill
The threat of entry is high when:
✓The minimum efficient scale to compete in an industry is low.
✓Network effects are not present.
✓Customer switching costs are low.
✓Capital requirements are low.
✓Incumbents do not possess:
Brand loyalty.
Proprietary technology.
Preferential access to raw materials.
Preferential access to distribution channels.
Favorable geographic locations.
Cumulative learning and experience effects.
✓Restrictive government regulations do not exist.
✓New entrants expect that incumbents will not or cannot retaliate.
18
Power of Suppliers
Pressures that industry suppliers can exert on an industry’s profit potential.
Lowers industry profit potential if:
Suppliers demand higher prices for their inputs.
Suppliers capture part of the economic value created.
© McGraw Hill
The power of suppliers is high when:
✓Supplier’s industry is more concentrated than the industry it sells to.
✓Suppliers do not depend heavily on the industry for their revenues.
✓Incumbent firms face significant switching costs when changing suppliers.
✓Suppliers offer products that are differentiated.
✓There are no readily available substitutes for the products or services that the suppliers offer.
✓Suppliers can credibly threaten to forward-integrate into the industry.
19
Power of Buyers (Customers)
Lowers industry profit potential if:
Buyers obtain price discounts, which reduces revenue.
Buyers demand higher quality / service, which raises production costs.
Situations when buyers are price sensitive:
The buyer’s purchase represents a significant portion of its procurement budget.
Buyers earn low profits or are strapped for cash.
The quality (cost) of the buyers’ products and services is not affected much by the quality (cost) of their inputs.
Buyers are the customers of an industry.
© McGraw Hill
The power of buyers is high when:
✓There are a few buyers and each buyer purchases large quantities relative to the size of a single seller.
✓The industry’s products are standardized or undifferentiated commodities.
✓Buyers face low or no switching costs.
✓Buyers can credibly threaten to backwardly integrate into the industry.
The retail giant Walmart provides perhaps the most potent example of tremendous buyer power. Walmart is not only the largest retailer worldwide (with over 12,000 stores and 2 million employees), but it is also one of the largest companies in the world (with $530 billion in revenues in 2019). Walmart is one of the few large big-box global retail chains and frequently purchases large quantities from its suppliers. Walmart leverages its buyer power by exerting tremendous pressure on its suppliers to lower prices and to increase quality or risk losing access to shelf space at the largest retailer in the world. Walmart’s buyer power is so strong that many suppliers co-locate offices directly next to Walmart’s headquarters in Bentonville, Arkansas, because such proximity enables Walmart’s managers to test the supplier’s latest products and negotiate prices.
20
Threat of Substitutes
Meet the same basic customer need:
In a different way.
Available from outside the given industry.
Examples:
Software vs. professional services.
Energy drinks vs. coffee.
Videoconferencing vs. business travel.
Wireless phone services vs. internet-based services (Skype).
© McGraw Hill
The threat of substitutes is high when:
✓The substitute offers an attractive price-performance trade-off.
✓The buyer’s cost of switching to the substitute is low.
Examples: many software products are substitutes to professional services, at least at the lower end. Tax preparation software such as Intuit’s TurboTax is a substitute for professional services offered by H&R Block and others. LegalZoom, an online legal documentation service, is a threat to professional law firms. Other examples of substitutes are energy drinks versus coffee, videoconferencing versus business travel, e-mail versus express mail, gasoline versus biofuel, and wireless telephone services versus Voice over Internet Protocol (VoIP), offered by Skype or Vonage.
21
Rivalry Among Competitors
The intensity with which companies in the same industry jockey for market share and profitability.
Can range from genteel to cut-throat.
The other forces in the model pressure this rivalry.
The stronger the forces, the stronger the competitive intensity.
© McGraw Hill
The rivalry among existing competitors is high when:
✓There are many competitors in the industry.
✓The competitors are roughly of equal size.
✓Industry growth is slow, zero, or even negative.
✓Exit barriers are high.
✓Incumbent firms are highly committed to the business.
✓Incumbent firms cannot read or understand each other’s strategies well.
✓Products and services are direct substitutes.
✓Fixed costs are high and marginal costs are low.
✓Excess capacity exists in the industry.
✓The product or service is perishable.
22
Competitive Industry Structure is Defined By
Number and size of competitors.
Firm’s degree of pricing power.
Type of product or service
(commodity or differentiated product).
Height of entry barriers.
© McGraw Hill
23
Industry Competitive Structures along the Continuum from Fragmented to Consolidated
Exhibit 3.4
Access the text alternative for slide image.
© McGraw Hill
Perfect competition: Many Internet entrepreneurs learned the hard way that it is difficult to beat the forces of perfect competition. Fueled by eager venture capitalists, about 100 online pet supply stores such as pets.com, petopia.com, and pet-store.com had sprung up by 1999, at the height of the Internet bubble. Cut-throat competition ensued, with online retailers selling products below cost. When there are many small firms offering a commodity product in an industry that is easy to enter, no one is able to increase prices and generate profits. Besanko, D., E. Dranove, M. Hanley, and S. Schaefer (2010), The Economics of Strategy, 5th ed. (Hoboken, NJ: John Wiley).
Examples of monopolistic competition: The computer hardware industry provides one example of monopolistic competition. Many firms compete in this industry, and even the largest of them (Apple, ASUS, Dell, HP, or Lenovo) have less than 20 percent market share. Moreover, while products between competitors tend to be similar, they are by no means identical.
Examples of oligopoly: The express-delivery industry is an example of an oligopoly. The main competitors in this space are FedEx and UPS. Any strategic decision made by FedEx (e.g., to expand delivery services to ground delivery of larger-size packages) directly affects UPS; likewise, any decision made by UPS (e.g., to guarantee next-day delivery before 8:00 a.m.) directly affects FedEx. Other examples of oligopolies include the soft drink industry (Coca-Cola vs, Pepsi), airframe manufacturing business (Boeing vs. Airbus), home-improvement retailing (The Home Depot vs. Lowe’s), toys and games (Hasbro vs. Mattel), and detergents (P&G vs. Unilever). When there are only two main competitors, it’s called a duopoly and is a special case of oligopoly.
Examples of monopoly: Examples: Georgia Power is the only supplier of electricity for some 2.5 million customers in the southeastern United States. Philadelphia Gas Works is the only supplier of natural gas in the city of Philadelphia, Pennsylvania, serving some 500,000 customers.
24
Industry Growth
Affects intensity of rivalry among competitors.
During periods of high growth:
Consumer demand rises.
Price competition among firms decreases.
During periods of negative growth:
Rivalry is fierce.
Rivals can only gain at the expense of one another.
Price discounts, promotional campaigns, and retaliation abound.
© McGraw Hill
Example: The demand for knee replacements, for example, is a fast-growing segment in the medical products industry. In the United States, robust demand is driven by the need for knee replacements for an aging population as well as for an increasingly obese population. The leading competitors are Zimmer Biomet, DePuy, and Stryker, with a significant share held by Smith & Nephew. Competition is primarily based on innovative design, improved implant materials, and differentiated products such as gender solutions and a range of high-flex knees. With improvements to materials and procedures, younger patients are also increasingly choosing early surgical intervention. Competitors are able to avoid price competition and, instead, focus on differentiation that allows premium pricing.
25
Strategic Commitments
Firm actions that are:
Costly, long-term oriented and difficult to reverse.
Can stem from:
Large, fixed cost requirements.
Non-economic considerations.
Affects intensity of rivalry among competitors.
© McGraw Hill
26
Exit Barriers
Obstacles that determine how easily a firm can leave that industry.
Mainly economic and social factors.
Include fixed costs that must be paid.
Examples: employee health care and retirement benefits.
© McGraw Hill
In Michigan, entire communities still depend on GM, Ford, and Chrysler. If any of those carmakers were to exit the industry, communities would suffer. Other social and economic factors include ripple effects through the supply chain. When one major player in an industry shuts down, its suppliers are adversely impacted as well.
27
A Sixth Force: Complements
A product, service, or competency that adds value when used with the original product.
Complements increase demand for the primary product.
Enhances the profit potential for the industry and the firm.
Co-opetition:
cooperation among competitors to achieve a strategic objective.
© McGraw Hill
28
Entry Choices
Exhibit 3.6
Source: Based on and adapted from Zachary, M.A., P.T. Gianiodis, G. Tyge Payne, and G.D. Markman (2014), “Entry timing: enduring lessons and future directions,” Journal of Management 41: 1409; and Bryce, D.J., and J.H. Dyer (2007, May), “Strategies to crack well-guarded markets,” Harvard Business Review: 84–92.
Access the text alternative for slide image.
© McGraw Hill
29
Industry Dynamics
A weakness of other models is that they are static (point-in-time snapshot).
Industry dynamics provides insight about:
Changing speed of an industry.
Rate of innovation.
Help capture structural changes in the industry.
© McGraw Hill
The U.S. domestic airline industry has witnessed several large, horizontal mergers between competitors, including Delta and Northwest, United and Continental, Southwest and AirTran, as well as American and U.S. Airways. These moves allow the remaining carriers to enjoy a more benign industry structure. It also allows them to retire some of the excess capacity in the industry as the merged airlines consolidate their networks of routes. The merger activity in the airline industry provides one example of how firms can proactively reshape industry structure in their favor. A more consolidated airline industry is likely to lead to higher ticket prices and fewer choices for customers, but also more profitable airlines.
30
Industry Convergence
When unrelated industries begin to satisfy the same customer need.
Caused by technological advances.
Example:
Media Industries:
Content going online.
Newspapers, magazines, TV, movies, radio, music.
Will print media become obsolete?
© McGraw Hill
Internet companies such as Google, Facebook, Instagram (acquired by Facebook), LinkedIn (acquired by Microsoft), Snap, Pinterest, and Twitter are changing the industry structure by constantly morphing their capabilities and forcing old-line media companies such as News Corp., Time Warner, and Disney to adapt. A wide variety of mobile devices, including smartphones, tablets, and e-readers, provide a new form of content delivery that has the potential to make print media obsolete.
31
Strategic Groups
Strategic groups:
A set of companies.
Pursue a similar strategy.
In the same industry.
The strategic group model (framework):
Clusters different firms into groups.
Is based on key strategic dimensions.
© McGraw Hill
Strategic groups differ from one another along important dimensions such as expenditures on research and development, technology, product differentiation, product and service offerings, market segments, distribution channels, and customer service.
32
How to Create a Strategic Group Model
Identify the important strategic dimensions.
Choose two key dimensions:
For horizontal and vertical axes.
Ensure they’re not highly correlated.
Graph the firms in the strategic group.
Each firm’s market share indicated by the size of the bubble.
© McGraw Hill
Examples of strategic dimensions: expenditures on research and development, technology, product differentiation, product and service offerings, pricing, market segments, distribution channels, and customer service.
33
Strategic Groups and Mobility Barrier in U.S. Domestic Airline Industry
Exhibit 3.8
Jump to Appendix 3.6 long image description
© McGraw Hill
34
Insights from Strategic Group Mapping
Competitive rivalry is strongest between firms in the same strategic group.
External environment affects strategic groups differently.
Five competitive forces affect strategic groups differently.
Some strategic groups more profitable than others.
© McGraw Hill
35
Mobility Barriers
Restrict movement between strategic groups.
Industry-specific factors that separate one group from another.
Based on hard-to-reverse investments (strategic commitments).
© McGraw Hill
The two groups identified in Exhibit 3.8 are separated by the fact that offering international routes necessitates the hub-and-spoke model. Frequently, the international routes tend to be the remaining profitable routes left for the legacy carriers; albeit the up-and-coming Persian Gulf region carriers, in particular Emirates, Etihad Airways, and Qatar Airways, are beginning to threaten this profit sanctuary.
If carriers in the lower-left cluster, such as SWA or JetBlue, would like to compete globally, they would likely need to change their point-to-point operating model to a hub-and-spoke model. Or they could select a few profitable international routes and service them with long-range aircrafts such as Boeing 787s or Airbus A-380s. Adding international service to the low-cost model, however, would require managerial commitments resulting in significant capital investments and a likely departure from a well-functioning business model. Additional regulatory hurdles reinforce these mobility barriers, such as the difficulty of securing landing slots at international airports around the world.
36
End of Main Content
© 2021 McGraw Hill. All rights reserved. Authorized only for instructor use in the classroom.
No reproduction or further distribution permitted without the prior written consent of McGraw Hill.
Because learning changes everything.®
www.mheducation.com
Accessibility Content: Text Alternatives for Images
38
© McGraw Hill
Industry Competitive Structures along the Continuum from Fragmented to Consolidated Text Alternative
Return to slide containing image.
The most fragmented industry form is perfect competition and it is made up of many small firms. Firms are price takers, they offer commodity products, and there are low entry barriers. The next somewhat fragmented industry form is monopolistic competition, which consists of many firms with some pricing power; they offer a differentiated product and there are medium entry barriers. The next somewhat consolidated industry form is an oligopoly, which features few (large) firms, some pricing power, a differentiated product, and high entry barriers. The next consolidated industry form is a monopoly, which consists of one firm with considerable pricing power, a unique product, and very high entry barriers.
Return to slide containing image.
© McGraw Hill
39
Entry Choices Text Alternative
Return to slide containing images.
This image is of a pentagon separated into five sides with a center block that reads “entry choices.” The following words are inscribed in the blocks:
Who:
identify the players incumbents, entrants, suppliers, customers, other stakeholders.
2. When:
entry timing, stage of industry life cycle, order of entry.
3. How:
leverage existing assets, reconfigure value chains, establish niches.
4. What:
type of entry scale, commitment, product and / or service, business model, etc.
5. Where:
leverage existing assets, reconfigure value chains, establish niches.
Return to slide containing images
© McGraw Hill
40
Strategic Groups and Mobility Barrier in U.S. Domestic Airline Industry Text Alternative
Return to slide containing image.
The two strategic dimensions on the axes are prices and routes. As a result of this mapping, two strategic groups become apparent, as indicated by the dashed lines: Group A, low-cost, point-to-point airlines (Virgin Atlantic, Alaska Airlines, JetBlue, and Southwest Airlines) and Group B, differentiated airlines using a hub-and-spoke system (American, Delta, and United). The low-cost, point-to-point airlines are clustered in the lower-left corner because they tend to offer lower ticket prices but generally serve fewer routes due to their point-to-point operating system.
The differentiated airlines in Group B, offering full services using a hub-and-spoke route system, are clustered in the upper-right corner because their frequently higher ticket prices reflect frequently higher cost structures. They usually offer many more routes than the point-to-point low-cost carriers, made possible by use of the hub-and-spoke system, and thus offer many different destinations.
Return to slide containing images
© McGraw Hill