Low

Stron

High

Mod

Mod
erat

1. (low)
Setting up airline industry needs a high capital, investment and
funding so it has high barriers, for example purchase aircraft, set up
services, hire staff et.

 New entrants have to create brand loyalty by making huge investment

to establish reputation, need to spend a lot of money on marketing and
advertising.
Government legislation is one of the barriers for entering to this
industry because it is too difficult getting a new flight route from
government.
Government policy has limited new entrant so V Air is already settled
on the market2013 11 15
2014 01 23 V
Air 2014 03 24 V Air V
Air 2014 09 18 V Air
2014 11 27
(Air Operator Certificate, AOC)

Threat of new entry is low to V Air company.

2.(high)
Airline industry has limited customer.
High exit cost once entering airline industry, hard to find company
exit the industry due to high cost in paying loans, staff retrenchment
and flight cancellation refunds.
V Air offers flights with lower price than other companies, but there is
company that also offer service by almost the same price such as
Tigerair Taiwan and provide service with the same level of V Air, and
have similar business strategy so, in this case rivalry among existing
competitor is high to V Air.
P.S. 2015 1

3.(strong)
For airline industry there are only two options Boing and Airbus.
Low concentration of aircraft manufacturers and limited availability
of substitutes allocate power for price negotiations by manufacturer.
A320 A321
2015 5 2 3
V Air )V
Airs single aircraft strategy makes it reliant on Airbus and unable to
switch manufacturer due to high associated costs and new training of
workers.
V Air also may influenced by Fuel industry: cost depend on
efficiency of carrier and fluctuating oil prices.
Generally, power of supplier is a quit strong to V Air.
4.(moderate)
For airline such as V Air without single large customer, the power of
the buyer is not too obvious.
Have other low-cost competitors, whats why available switch to other
airlines service.
Companies offer better service to their customers are winner of
competition.
Power of buyer is a moderate to V Air.
5.(moderate)
Cost and time are two major considerations for buyers. For example,
some buyers want to save money and have time choose to travel by
ships from Taiwan to cities in North-East Asia and South-East Asia.
Other buyers, who want to spend less time travelling, airline is a good
choice and by access internet customers will compare prices and
chooses the more reasonable for themselves.
In such case threat of substitutes is moderate to V Air