Classic Airlines: Cost-Focused or Customer-Focused?


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Essay #: 068499
Total text length is 23,729 characters (approximately 16.4 pages).

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The beginning:
Classic Airlines: Cost-Focused or Customer-Focused?
Classic Airlines (CA), the world's fifth largest airline with more than 375 jets and 32,000 employees, is in trouble and may be facing bankruptcy. Its incentive program, Classics Rewards, has lost about one-fifth of its members and those who remained used it for 20 per cent fewer flights. It operates in the red for much of the year and has a very low profit margin, with profits of only ten million dollars last year on total revenues of 8.7 billion. During that time, the price of its shares has gone down by 10%, meaning that it is no longer seen as an attractive investment by the stock market. The Board of Directors has ordered a 15% cut in costs over the next 18 months, and...
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