Song Airlines Business Case

Song Airlines Case

Song airline was a low cost carrier subsidiary of Delta airlines that started in 2003. It was formed to compete with JetBlue and other low cost airlines for the Florida market. The market environment at the time of the case was extremely difficult with the rising costs of fuel, increasing security requirements after 9/11 and customers’ expectations of lower fares. It has forced many big players in the airline industry into bankruptcy. The operational costs which include gate fees, ground operational costs etc. were increasing causing even more problems for the airlines. The fares in the Florida route were decreasing while the costs were ever increasing making it difficult to remain operational in that space.

The basic marketing strategy of Song Airlines was to reduce cost and increase volume through operational efficiencies and hence increase profits.

The company’s main market strategy included:

1. Reducing unit costs and increasing the volume of units. By changing the airplane fleet to have bigger planes they increased the volume of seats by 70%.

2. Increase the utilization of the resources (planes, employees,