Rapidly grow market factors favor such as economic, politics and demographic lead to the establishment of a new airline to meet the demand for additional, higher-quality passenger and cargo service linking Malaysia with the rapidly expanding markets of Europe, United State of America, despite of linking Malaysia inbound destinations, via Kuala Lumpur hubs, to global destinations.
This new airline, HyperX Airlines will base its business and marketing strategies on achieving high, and profitable, load factors through absorption of unmet demand in three key air-traffic categories: unserved and under-served routes on which high unmet demand currently exists or can be readily developed; and meeting peak traffic demands on certain key regional, seasonal, and variable routes where very high load factors can be predicted despite existing but lower-quality competition, or where competition cannot meet the demand.
In addition, the proposed new airline will be designed around, and operated utilizing, the most up-to-date electronic, informational, and aviation technologies to ensure low operating and marketing costs, maximum efficiency in deployment of its resources, and a high level of customer service and convenience.
In short, the goal of this new airline is to be known to the passenger and the cargo customer by its proposed motto: "Enjoy Extra Comfort 35,000 feet in the sky"
Primary financial results anticipated during the first year of operations include:
* Average passenger load factors in the 60-80 percent range, depending on route and season, reached within the first year of flight operations, and increasing thereafter to the 75-90 percent range.
* Revenues approachingRM6 millionwithin the first six months of flight operations, exceedingRM15 million by the end of the first year 2010,RM20 millionin the second year of operations, and nearlyRM40 million in the third.
A key element contributing to the success of this new carrier will be its organizational and management team. Leading this team is HyperX Corporation. (HyperX Airlines), a MALAYSIA corporation that is regionally based in Sepang, Selangor and which knows the region and its business needs. HyperX Airlines, together with its partner companies and associations throughout the countries of Europe and beyond, identifies business and profit opportunities and develops projects and strategic partnerships to implement and benefit from them.
The proposed new airline's mission, simply stated, is to fill a niche in the growing air-travel and cargo markets linking Malaysia, and points beyond, to Europe, United State of America and domestic bound; to achieve high, and profitable, load factors by identifying and serving key routes and city pairs currently unserved, under-served, or poorly served, and where significant unmet demand exists; and to set a new standard for air service and professionalism both within the target market region and beyond.
By utilizing the latest aviation, electronic, and informational technologies, and by designing effective and efficient systems and building in quality control from the outset, we aim to ensure the highest level of service, operations, and safety, all based around the needs, wants, comfort, and convenience of the passenger and the cargo client. This combination of technology, service orientation, and quality oversight will help keep costs at a minimum and maximize profits to the airline and its investors. It also will help build the strong customer satisfaction and excellent reputation that will enable the airline to build solid, and crucially important, interline arrangements necessary to expand its scope and customer attraction in the early stages, and which will lead to continued long-term growth both within the target market area and, looking toward the future, beyond.
In short, this airline wants to be known by its proposed guiding motto: "Enjoy Extra Comfort 35000 feet on the sky"
1.1 Keys to Success
In descending order of importance, the critical keys to success for the proposed new regional airline are:
* Employing an experienced, highly professional management team which have solid knowledge of the aviation business; familiarity with, and belief in, the utilization and benefits of the latest aviation, electronic, and informational technologies; on-the-ground knowledge of the region and markets to be served; realization of the crucial importance of an organization's personnel to its success; and a total familiarity with, and commitment to, the overall mission and goals of the proposed new airline.
* Intelligent, progressive, and aggressive marketing that identifies the airline as a different kind of player, one that is sharper and smarter, and with a higher level of professionalism and operational standard than is the norm in the target region.
* Concentration on safety, with highly trained, dedicated, and professional personnel, caring for the passenger and the passenger's needs and wants, the advantages offered by advanced technology, and straightforward, understandable, highly competitive tariffs and fare pricing, all will form key pillars of the marketing strategy.
* Identification, through careful market research, of unserved or under-served routes and city pairs in the target market area with sufficient passenger demand to enable high load factors and profitable operations utilizing the category of aircraft envisaged.
* Maintaining flexibility that enables the airline to always respond and adapt to changing market conditions and opportunities, without being erratic, and employing equipment, scheduling, and staffing on a basis that is sufficient to get the job done properly, efficiently, and at a high rate of return, without "overkill" or fielding costly excess capacity or, conversely, unduly cancelling scheduled flight operations.
* Identifying, developing, and quickly and cost-effectively exploiting opportunities for new markets, new market concepts, and expanded sales potential.
* Provision of high-quality service on routes and in markets that currently are unserved, poorly served, or under-subscribed by existing carriers, thereby setting both a new trend and a new pace in air service to and within the Malaysia region.
* Utilization of the latest electronic and informational technologies in sales and marketing; reservations, ticketing and check-in; scheduling and resource planning; cargo tracking; and operational oversight.
* Leading the proposed airline to provide a high level of non-electronic service as well, particularly to the many newer, less-experienced travelers - but future loyal customers - found in the region.
* Ensuring a friendly, cooperative, enjoyable, yet highly professional face to the customer.
Our vision is:
“To become the largest airline in the world with high-quality services and ensuring a friendly, cooperative, enjoyable, yet highly professional face to the customer through utilization of the latest electronic and informational technologies”.
We choose this vision because we look forward where we still can found a deficiency from our competitors that through absorption of unmet demand in three key air-traffic categories: unserved and under-served routes on which high unmet demand currently exists or can be readily developed; serving key niche markets where demand is either unmet or poorly served; and meeting peak traffic demands on certain key regional, seasonal, and variable routes where very high load factors can be predicted despite existing but lower-quality competition, or where competition cannot meet the demand. The comfort, reliability, speed, and safety of the new airline's aircraft all will enable it to be the airline of preference for virtually all business, government, and organizational travelers from both within and outside the target region when traveling to or within the region, and it also will be preferred by most leisure and personal travelers, including those from with the target region, as well. As a customer, passengers want convenient and proper places and services although in different classes in airlines. Because of that, we are tries our best to meet a requirement by our customers through provided a high-quality services and focusing in utilization of the latest electronic and informational technologies such as reservations, ticketing and check-in. Through these facilities, it will ensure a fast and easier to our customers by using our airlines, HyperX Airlines.
3.0 COMPANY SUMMARY
HyperX Airlines, which is proposing to become a new airline system, is a subsidiary of HyperX Corporation Berhad, An Malaysia's corporation registered in the Malaysia and headquartered in Kuala Lumpur, Selangor, with a Malaysia regional headquarters located in Sepang.
HyperX Airlines, together with its partner companies and associations throughout the countries of Europe and beyond, identifies key business and profit opportunities and develops projects and strategic partnerships to implement and benefit from them.
The founder of the HyperX Corporation Berhad had identified a growth opportunity in the aviation and travel sector in Europe and United State of America. This opportunity is occasioned by growing economic, political, and social stability, and consequent significant business expansion, within and between most of the countries of the region; vastly expanded outside contact and support with and for the region.
Additionally, the company has determined that maximum potential from this growth opportunity can be obtained not only by linking certain key destinations within the European region, but by linking the region with carefully selected destinations in Europe and United State of America. It further has identified significant unmet demand, and significant short-, medium-, and long-term growth potential.
3.1 Ancillary Travel Services
In response to the growing travel-market potential of the region, represented in particular by the large expatriate community living and working in parts of the region, including Malaysia Airlines, Air Asia, MasWings, Fireflyz. HyperX Airlines had established Luxurious Hassle-Free budget holidays, a package-travel wholesaler and retailer, on the beginning of the aviation service.
Both Hassle-Free Holidays and its partner organizations are expected to feed customers and traffic to the regional airline and utilize the airline's services when possible, and will act as additional low-cost outlets for marketing the airline through their planned electronic-commerce websites. Hassle-Free Holidays already has established other close links like Air Asia and Fireflyz by offering the low price ticket to their target market.
3.2 OTHER RELATED COMPANY ACTIVITIES OF HYPERX AIRLINES
HyperX Airlines currently maintains strategic partnerships or associations with companies in the following functional and geographic areas, all of which can serve to support, augment, or supplement the proposed new airline's core aviation business:
* Construction, construction management, and construction technology (Malaysia, Singapore, Japan, New Zealand's).
* Environmental engineering, including water and waste water treatment and solid-waste management (Germany).
* High-level security, demining, and explosive-ordnance removal (U.K.).
* Aviation services and airport development (Washington).
* Travel services and package travel development and marketing (Ministry of Tourism Malaysia, Singapore, Japan, and New Zealand's).
* Free-trade zone development (Malaysia).
The company owns 35 percent of a private joint venture limited-liability company, Kelvin Engineering, founded in early 2001 and based in Sibu, Sarawak. The joint-venture company is set up to undertake primarily public road and street construction and reconstruction projects, as well as general construction and development projects, in KLIA West.
It also is considering tendering, either on its own or more likely in conjunction with a major local engineering and construction firm, for the planned new passenger terminal at the west side of Kuala Lumpur International Airport.
In addition, HyperX Airlines also holds exclusive license rights to two advanced Malaysia-developed construction technologies in the 2 countries of Southeast Europe, including Greece and Romania.
These technologies, combined with other building technologies, products, and methodologies the company and associated companies represent, can offer significant advantages to the new airline should it pursue, either on its own or in conjunction with HyperX Airlines, development and construction of new passenger-, baggage-, and cargo-handling facilities and other related installations.
3.3 LEGAL RELATIONSHIPS AND COMPANY STATUS OF HYPERX AIRLINES
HyperX Airlines intends to spin-off the proposed new airline operating company into a separate legal entity under the continued partial ownership and general oversight of HyperX Airlines.
In order to obtain maximum flexibility in terms of certification and flight and landing rights, it is important that the primary carrier operate under an air operator's certificate (AOC) granted by a European Union country. Since current E.U. requirements stipulate that European Union nationals (companies and individuals) hold the majority ownership interest in any E.U.-flagged carrier, it is critical that overall ownership in the new airline be structured in such a way that the majority interest is held by E.U. nationals.
According to its overall organizational plan, HyperX Airlines anticipates reorganizing itself into an off-shore holding company (BC Holdings International Ltd), most likely registered in Anguilla, and transferring the current share ownership of HyperX Airlines Malaysia. to the new off-shore holding company. HyperX Airlines Malaysia will then become a daughter marketing company of BC Holdings International, with a majority of its shares owned by European and a minority share owned by BC Holdings International as a holding company.
HyperX Airlines (in its new identity as BC Holdings International and as "HyperX Airlines EU") anticipates maintaining or appointing positions on the new airline operating company's board of directors proportional to its direct or indirect ownership interest in the airline, with other board positions held or named by other investors in the airline proportional to their ownership interests. Additionally, some board positions will be held by non-equity members, nominated by HyperX Airlines and the other investors and strategically selected by the board, whose presence and guidance can serve to advance the new airline's operations, business interests, financial positioning, and expansion.
It is anticipated that the new airline operating company will be established as a limited-liability company in one or more E.U. countries, the country or countries to be determined based on tax requirements and relative tax and business operating advantages, and other substantive considerations. For instance, registering and basing the company in Luxembourg may offer significant tax, as well as logistic, advantages to the new airline.
4.0 MARKET SEGMENTATION
Market segmentation is the process of grouping customers in markets with some heterogeneity into smaller more similar or homogeneous segments or the identification of portions of the market that are different from one another. Segmentation allows the firm to better satisfy the needs of its potential customers. Homogeneous markets itself explain that markets in which all customers have different requirements.
Other than that, a market segment include a group of individuals, group or organizations sharing one or more similar characteristics that cause them to have relatively similar product needs and buying characteristics. For this segmentation successful, it has some requirement to fulfill. For instance, in addition to having different needs, for segments to be practical they should be evaluated against the following criteria such as Identifiable: the differentiating attributes of the segments must be measurable so that they can be identified, Accessible: the segments must be reachable through communication and distribution channels, Substantial: the segments should be sufficiently large to justify the resources required to target them, Unique needs: to justify separate offerings, the segments must respond differently to the different marketing mixes and Durable: the segments should be relatively stable to minimize the cost of frequent changes. A good market segmentation will result in segment members that are internally homogenous and externally heterogeneous; that is, as similar as possible within the segment, and as different as possible between segments.
This new airline, HyperX Airlines will focus their market segmentation on leisure and corporate as potential customers. We are strongly belief that this segmentation has a potential profit that will enhance our airlines to become competitors among other airlines. We choose this segmentation because as an airliners company, a lot a customer's consist of businessmen that have business deals around the world and travel frequently from one destinations to other destinations such as attend a meeting or seminar at abroad. Business itself has significant role in cooperates world. Businesses are predominant in capitalist economies, most being privately owned and formed to earn profit that will increase the wealth of its owners and grow the business itself. The owners and operators of a business have as one of their main objectives such as the receipt or generation of a financial return in exchange for work and acceptance of risk. Through this process, the businessman needs to have a lot of contacts with other businessmen to consolidate the performance of company. From the research that we do through this portions, we found cooperates sectors such as businessman have to travel to a few places for business matters such as transactions with their partner either in this country or abroad. As a businessman, their frequently using airlines as transportations as a faster way to reach to certain place for business deals or attend conferences this country or abroad.
With facility that we have such as Electronic ticketing (e-ticketing) which will enable passengers to obtain their tickets online and avoid the need to obtain paper tickets from airline offices, travel agencies, or at the airport. It also frees the airline from having to stock, track, and issue tickets and maintains paper trails of them. Again, this shows more savings of money for both the airline and the customer through this process. Electronic check-in (e-check-in) that will virtually eliminate waiting in line to check-in for e-ticketed passengers, enabling them to confirm their identities, obtain their boarding passes, and check-in their baggage (and even purchase tickets upon check-in) utilizing a user-friendly kiosk that eliminates those last-minute frustrating waits to get to the counter. And it also greatly reduces the airline's needs to staff check-in desks, control long lines, employ local contract ground staff, and expend money and resources on an antiquated system that only adds to the traveler's inconvenience and frustration. This shows another win-win situation for both airline and passenger. We provide these services because we know as businessman they don't want to spend time to buy tickets manually. Through the technologies we have, it will facilitate the requirements of business as we Meet the highest standards for safety, reliability, and service and be accessible through normal reservations and ticketing systems. This shows our potential profit to our airlines because this portion was a major user in airlines.
Other than that, other segmentation that becomes our priority is leisure. Leisure itself has its own meaningful definition almost all the human being. Leisure or free time is a period of time spent out of work and essential domestic activity. It is also the period of recreational and discretionary time before or after compulsory activities such as eating and sleeping, going to work or running a business, attending school and doing homework, household chores, and day-to-day stress. The distinction between leisure and compulsory activities is loosely applied, i.e. people sometimes do work-oriented tasks for pleasure as well as for long-term utility. Through this segment, we can develop potential revenue to our airlines because people have to travel either for recreational or essential domestic activity.
Leisure itself can be divided to two sub-segments like active leisure and passive leisure. Active leisure activities involve the exertion of physical or mental energy. Low-impact physical activities include walking and yoga, which expend little energy and have little contact or competition. High-impact activities such as kick-boxing and football consume much energy and are competitive. Some active leisure activities involve almost no physical activity, but do require a substantial mental effort, such as playing chess or painting a picture. Active leisure and recreation overlap significantly and Passive leisure activities are those in which a person does not exert any significant physical or mental energy, such as going to the cinema, watching television, or gambling on slot machines. Some leisure experts discourage these types of leisure activity, on the grounds that they do not provide the benefits offered by active leisure activities. For example, acting in a community drama (an active leisure activity) could build a person's skills or self-confidence. Nevertheless, passive leisure activities are a good way of relaxing for many people. This segmentation becomes our priorities because from our marketing research, we found that a lot of tourists around the world are use airlines as conveyance to travel all around the world either inbound or outbound such as having holidayed or shopping at oversea. This shows that this segmentation will promise a large profit for our airlines, HyperX Airlines.
5.0 TARGET MARKET
Targeting means involves the decision about which market segments an organization decides to prioritize for its sales and marketing efforts. For target market in these airlines, HyperX Airlines choose to have a differentiated strategy consist of a strategy by which an organization directs its marketing efforts towards two or more market segments by developing a marketing mix for each target market.
We are focusing to a big company that has a good reputation in business world and travel a lot either inbound or outbound. As businessmen, there have a lot duty to fulfill not only in their country but also abroad such as doing transaction with their partners from overseas or attending meeting to discuss about a future tender in the business. These target markets give our airlines, HyperX Airlines a large opportunity to enhance our profitability and the investors. Using high -quality service on routes and in markets that currently are unserved, poorly served, or under-subscribed by existing carriers and utilization of the latest electronic and informational technologies in sales and marketing; reservations, ticketing and check-in; scheduling and resource planning; cargo tracking; and operational oversight will make an easier way to businessman to have a business deals an communicate with their partnership during fly with our airlines. It is because our airlines provided latest technologies such as internet and videoconferencing that uses video and audio links along with computers to enable people in different locations to see, hear, and talk with one another to facility our customers that involve in the business.
Other than that, we are also focusing to a new couple that just married and want to have a wonderful place to honeymoon or celebrating an anniversary. Our airlines grant almost 101 destinations either inbound or outbound for our target market as a choice where we choose almost all attraction places in the world in our packages. We choose a new couple that just married as our target market because as new couple there of course want to have their honeymoon either in this country or overseas. Because of that, this shows that have potential revenue that we can see through this target market. By using our airlines, this couple wills experiences a magnificence environment and venue where we provide to you a friendly, cooperative, enjoyable, yet highly professional face to the customer and high technologies accommodations such as all seat in our aircraft equipped with a capsule seats. This was invented by new technology from Japan. Moreover, our airlines offered to our customers a lot of tourist attractions in the world such as Berlin, Germany; London, United Kingdom; Basel/Mulhouse, Switzerland; Amsterdam, The Netherlands; Cologne/Bonn, Germany; Munich, Germany, France or Dubai. It will ensure a wonderful experience to our new couple a rest of their life by using our airlines with a package that we have.
Nevertheless, our final target market for our airlines, HyperX Airlines was a pensioner that just retires from work after reaching a particular age limit. We selects this kind of target market because a few reasons. As a pensioner, either in government sector or private sectors their own saving such as KWSP as a saving during elder ages. From marketing research that we do through people in town, we found that a lot of workers either in government sector or private sectors like to spend their money with travel to tourism attractive places as leisure time and relaxing their life from working so long in factory, government or other fields. We as airlines often view active leisure activities positively, because active leisure activities require the purchase of tickets and services, which stimulates the economy and generates currency to our company. Capitalist societies often accord greater status to members who have more wealth and one of the ways that wealthy people can choose to spend their money is by having additional leisure time. Through all view from this target market, we can see bright potential revenue from this target market.
6.0 SWOT ANALYSIS
SWOT analysis is a strategic planning method used to evaluate the Strengths, Weaknesses, Opportunities, and Threats involved in a project or in a business venture. It involves specifying the objective of the business venture or project and identifying the internal and external factors that are favorable and unfavorable to achieving that objective.
HyperX Airlines System had analysis the SWOT for the market on the following criteria:
In the analysis of prices between the competitor's airlines in Malaysia with HyperX Airlines, Air Asia apparently is the main competitors in price among all the local competitors. Air Asia offers zero fare air ticket promotion for the early bookings but with no refunds for cancellations and no shows. Malaysia Airlines (MAS) and their daughter company MasWings and Fireflyz offer the price which relatively higher than the price offer by Air Asia but they are well known for their good services and punctuality and yet Malaysia Airlines was a large company of aviation industry in Malaysia. Hence, HyperX Airlines system face price competition for the local bound. HyperX Airlines System will set a standard price which is consistence throughout the years in order to compete with the local competitors without affecting the shareholder equity. The international airlines which operate in Malaysia such as Jets Airs, Tiger Airways, Emirates Airlines, Virgin Airlines, Garuda Airlines and many much more had drastically threaten the fare for the international bounds. These mega companies are able to offer the much cheaper price for international bounds since for the reason of government subsidiary and tax free for the permission of landing. HyperX Airlines System had taken the initiative to create a joint venture alliances with those Mega companies to enjoy the benefits enjoy by them in their country. Hence, HyperX Airlines System had established HyperX Airlines EU in the Europe with the major stockholder are from European and manage by BC Holdings International Ltd. Hence this make HyperX Airlines System manage to offer the price a little bit lower than the competitors and this gives HyperX Airlines an opportunities to compete with the competitors.
HyperX Airlines System will offer the transit services for all the flight in our networking. Malaysia Airlines system also offer the similar services with their partner Airlines but Air Asia the hassle free budget airlines did not offer the similar services and strictly practicing point to point carrier which the passenger need to complete all the clearances and transit procedure all by themselves. In order to compete with the Malaysia Airlines System, HyperX Airlines System had taken the initiative to offer the Visa and Immigration Clearances by setting up the high technology biometric kiosk at the arrival and departure airport within the networking with the courtesy and cooperation from the local airport authority and immigration department. For Cabin services HyperX Airlines System offer limited full services to the entire passenger on flight. The services might request upon in-flight without any prior reservations like Malaysia Airlines System and Air Asia. The fares for the extra services that offer in-flight are 25% much lower than the competitor airlines based on the Skytraxx analysis. HyperX Airlines System offer in-flight restaurant, spa, casino, and bar which never offer by any airlines in the aviation industry.
MAS Airlines is the most comfortable airlines company among all the local airlines company in Malaysia because of its price and its background. For HyperX Airlines System, we offer exclusive capsule seat for passenger. We have about 10 joint capsule seats for passengers who would like to have some privacy or want to try something new. We also provide first class seats in about 16 seats, business class about 22 seats and economy class in about 188 seats. All seats are cover with the finest wool cushion and come with a comfort kit which includes pillow, blanket, eye cover, and other amenities such as tooth brush, tooth paste. Our seat is 25% larger than the seat offer by Malaysia Airlines and 50% larger than Air Asia. Extra Large seat space will guarantee maximum utility from the passenger. In-flight movie is charges at USD 3 for the entire blockbuster movie offer. We provide free song playing for the entire passenger on board.
MAS Airlines have 265 networking in all over the world. These figures include 85 networking by own aircraft and 180 joint venture networking with the partner airlines throughout the globe. Meanwhile, Air Asia has 78 networking and all of the destinations are potential tourism hotspots through Air Asia Malaysia, Air Asia Indonesia, Air Asia Thailand and Air Asia X. HyperX Airlines Systems have 101 networking and every single networking have its own potential tourism hotspots. HyperX Airlines system also made joint-venture with EU through BC Holdings International Ltd to gain the landing certificate.
MAS Airlines will have 6 A380-800 aircraft in the year of 2011. Currently, Malaysia Airlines has 17 B747-400 aircraft, 9 A340-200 aircraft and 15 B777-300ER aircraft 11 A330-300 aircraft 5 A330-200 aircraft 39 B737-400 aircraft 10 Fokker 50 Aircraft, 5 DHC-6 Twin-otter aircraft .
Currently Air Asia has 70 A320-200 aircraft, and 2 A340-300 aircraft. 6 A330-300, 9 B737-300. Air Asia will have 175 fleet in the end of year 2015 which include 10 A350-900. Most of the aircraft are lease from AWAS.
Meanwhile, HyperX Airlines System has 16 A320-200, 36 B747-400 and 80 A380-800 aircraft on fleet. Most of the aircraft are lease from Ansett Worldwide Aviation Services (AWAS) and Orix Aviation. In the end of year 2015, HyperX Airlines System owns all the aircraft which lease from these companies. Leasing the aircraft will give opportunities to HyperX Airlines System to offer the fare much cheaper since the management may negotiate the rate that need to pay for each aircraft lease for certain periods.
HyperX Airlines System has two kinds of packages to be offer to passengers which is inbound and outbound travelling packages.
For inbound package, HyperX Airlines System provides the packages both to corporate traveler and leisure traveler. For corporate traveler package, HyperX Airlines System provides limo's to pick up the customer to the airport and the package also include luxurious hotel rooms and meeting planner services for those who need to plan the meeting despite of the access to all the services in-flight.
For leisure travelers, HyperX Airlines System provides a shuttle for the passengers, a holiday package at one of our local destinations. HyperX Airlines System also includes hotel room in three star level hotels; special package can be arranged for people who want celebrate their anniversary. There are no airlines companies are providing and arranging the travel package for their passenger.
For outbound package, HyperX Airlines System provides honeymoon packages. In this package, HyperX Airlines System uses capsule seats. Two capsules are joins together to make a room for a couple. HyperX Airlines System also provides a continental breakfast for these honeymoon packages customers. In-flight spa also will be providing for them. HyperX Airlines System will include a travel package for 2 for these new couple sweet memories. All of these packages also include a complementary gift from HyperX Airlines System.
All of these packages will give HyperX Airlines System strength since there are no airlines offer the same services to their guest. These packages are form to fulfill the airlines mission to provide a “Luxurious Hassle-Free budget holidays.” and yet memorable.