Business Case Studies, Leadership Case Study, Tata Group,Ratan Tata

Code :BSM0028

Year : 2005

Industry : Transportation

Region : USA

Teaching Note:Available

Structured Assignment :Available

Abstract: Yet another new business model has taken birth in the wired commercial aviation industry. But, unlike its predecessors, this time the new model is in the much lucrative transatlantic route between New York and London and in the high-yield business travellers' segment. A new airline called EOS, a single-class airline, started operations in mid-October 2005, with a single Boeing 757 (accommodating 200 passengers), redesigned to carry 48 passengers. eos likes to call its passengers 'guests' and the experience of flying, the airline says, will be like travelling on a private jet. The carrier offers a separate cabin for every passenger furnished with: (1) 21 square feet (two square metres) of space; (2) fully reclinable 78-inch bed with cashmere blankets and Tempur-Pedic pillows; (3) china crockery; (4) a personal DVD player; (5) individual in-flight entertainment devices; and (6) a guest seat for every passenger, with arrangements made to host dinner or a business discussion. The aim is to make the passengers arrive refreshed and revived after a seven hour flight across the Atlantic. All this for a lower price than the competitors. Even though analysts express doubts over the success of the single-class and lone flight business model, seasoned players are taking a note of the experiment, lest they lose business as happened in the early 1970s in the case of low cost carriers.