Tuesday, April 30, 2013

The consolidation of the LCC market

The airline business model does not congenitally have geographic restrictions on its own. Airline companies are free to choose their operational models as long as they can successfully operate. The so far success of Air Arabia in applying the LCC model does not necessarily mean that Sama can comparatively succeed applying the same model.

Sama’s management was fully aware of the applicable rules of the Saudi Civil Aviation from the beginning. Considering the fact that there was no significant change in those Saudi rules, Sama’s management team was gambling by mainly depending on the possibility of changing those rules.

What was the plan of Mr. Bruce Ashby, the CEO of Sama by searching for more finance? Was he planning to use the same management culture in utilizing the new funds? Was he simply planning to eventually run out of cash again?

Date: 30 August 2010 commenting on http://oussamastake.blogspot.com/

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