Air Canada is a flag-carrier Canadian airline. It started its business journey in 1937 as a subsidiary of Trans-Canada Air Lines. Today, we’ll discuss the SWOT analysis of Air Canada; it outlines strengths and weaknesses; opportunities and threats that the company has to face; as a business strategy analysis example company.
Products and services portfolio of Air Canada
- Air travel
- Economy class
- On-flight service
- Signature class
- Premium class
- Business class
Subsidiaries of Air Canada
- Rogue Air Canada
- Jetz Air Canada
- Express Air Canada
- Cargo Air Canada
Statistical facts and figures of Air Canada
- Market capital – 5.19 billion USD (2023)
- Annual revenue – 16.2 billion USD (2023)
- Net income – 2.34 billion USD (2023)
- Employees – 36000
- Asset net worth – 22.80 billion USD (2023)
- Fleet size – 353 aircraft
- Destinations – 195
Competitors of Air Canada
- Lufthansa
- United Airlines
- Virgin Atlantic
- Southwest Airlines
- JetBlue Airways
- American Airlines
- Delta Airlines
- WestJet
- Firefly
- Iberia
- Rossiya Airlines
The SWOT analysis of Air Canada would analyze the internal strengths and weaknesses of the company; and external opportunities and threats that the brand has to face. Here’s Air Canada SWOT analysis as a business strategy analysis example company as follows;
Strengths of Air Canada
Some of the main internal strengths in the Air Canada SWOT analysis example company as business strategy analysis are as follows;
Service Portfolio
Air Canada has developed a very comprehensive portfolio comprised of a wide range of services. It allows the company to serve the needs and requirements of various segments of the customer market. Some of the main services that the company offers are as follows;
- Vacation packages
- Overhaul MRO services
- Repair and maintenance
- Loyalty programs
- Cargo service
- Air transportation
Large Fleet Size
Air Canada has a significantly large fleet size comprising 353 aircraft and they offer the destinations to 195 locations across the world. The aircraft suppliers are Bombardier, Boeing, and Airbus and they are the world’s top aircraft manufacturing companies. However, the objective of having a large fleet size is to improve the company’s capacity to meet the deadlines.
Alliance
Air Canada has developed a strategic alliance with “Star Alliance” which is the world’s largest alliance of global airlines. It further amplifies the company’s market reach and helps the airline brand in the following ways;
- Partnerships
- Joint ventures
- Codesharing agreements
- Seamless travel experiences for customers
Unique Customer Experience
Air Canada has always followed a customer-focused strategy and it helps the airline brand to offer a unique in-flight customer experience to the air travelers. Some of the main features that contribute to the unique customer experience are as follows;
- Personalization and customized service
- Digital media service
- In-flight amenities
Sustainability Initiative
Air Canada has made a strong commitment to the environmental sustainability initiative. The airline brand plans to achieve a net-zero carbon emission rate by 2050. The company is collaborating with its manufacturing suppliers for the improvement in efficient technology.
Weaknesses of Air Canada
Some of the main internal weaknesses in the Air Canada SWOT analysis example company as business strategy analysis are as follows;
Labor Issues
Air Canada has had a very tense relationship with its labor union and it caused strikes, labor disputes, and other no-work initiatives. The conflicted labor relationships aren’t good for the company’s growth and productivity. Ultimately, it jeopardizes the company’s reputation and pushes away potential customers and partners.
High Debt
If you closely study the company’s balance sheet and profit and loss statement, then you will see the high debt-equity ratio. The reason behind this is the company’s high operational expenses; fuel costs, repair and maintenance services, employees’ salaries, and other running costs. When the aviation brand can’t meet its expenses, then the company needs a loan to leverage its equity and assets.
Over-dependence on the Canadian Market
There is no doubt Air Canada is operating its air travel business worldwide, but the aviation brand is heavily relying on the Canadian market as its main source of revenue. High reliance on one market is not a good business strategy; it limits the company’s growth and market share.
Opportunities for Air Canada
Some of the main available opportunities in the Air Canada SWOT analysis example company as business strategy analysis are as follows;
Market Expansion
Air Canada should expand its business in new regions and countries across the globe. The emerging markets hold great growth potential, and there are many countries that don’t have an airline. The airline brand should partner up with them and offer their exclusive air travel services. It allows the company to amplify its customer market reach.
Tech Investment
Air Canada should invest resources in the latest technological developments. It allows the company to achieve efficiency in its operations; quick ticketing and booking process, and improve service experience on-flight and off-flight. Ultimately, it improves the customer satisfaction level; happy and satisfied customers become repeat customers.
Strategic Alliance
Air Canada should develop strategic alliances and partnerships with other airlines and aviation companies. It allows the company to increase its market reach and enter new regions and markets across the world.
Threats to Air Canada
Some of the main potential threats in the Air Canada SWOT analysis example company as business strategy analysis are as follows;
Competition
The aviation industry has become highly competitive in recent years. There are multiple airline brands operating business in the market; they offer the same air travel service and charge the same price; a higher substitution rate decreases the company’s market share.
Regulations
Government and country regulations are very strict when it comes to the safety and security of air travelers. It imposes great pressure on the aviation company Air Canada to regularly perform repair and maintenance checks to ensure the safety of its passengers.
Cyber Security
Speaking of security, cyber-security is equally significant ever since the world is moving toward digitalization. The company needs to secure its data and codes from potential hackers and cybercriminals.
Conclusion: Air Canada SWOT Analysis Example Company |SWOT Analysis of Air Canada |Business Strategy Analysis
After an in-depth study of the SWOT analysis of Air Canada; we have realized that Air Canada is the world’s leading Canadian aviation company. If you are learning about Air Canada SWOT analysis example company; then you should keep in mind the abovementioned internal strengths and weaknesses; external opportunities and threats as brand strategy analysis.
Ahsan Ali Shaw is an accomplished Business Writer, Analyst, and Public Speaker. Other than that, he’s a fun loving person.
