|Case: “Dogfight over Europe: Ryanair (A)” Harvard Business School case no. 9-700-115, November 21st 2007
Discussion question: What are some sources of economies of scale? How do they apply to British Airways in 1986?
Textbook Reading: Chapter 2 (Section 2.3; pp. 54-59)
During class I also recommend:
|Case: “Dogfight over Europe: Ryanair (B)” Harvard Business School case no. 700116, June 12th 2000|
A 2014 newspaper report likened the rise of budget supermarkets (such as Aldi and Lidl) to the strategy that saw Ryanair outcompete BA:
- Further reading: Ruddick, Graham, “Is Aldi doing to Tesco what Ryanair did to British Airways?” Daily Telegraph, February 2014
If you are interested in aviation, this episode of Cockpit Casual starts with a fascinating account of how airline companies (and airports) reacted to covid given the large number of leased planes and the substitutability of passenger and cargo payloads.
- Only flying 737s
- Simple fare structure
- Point-to-point (for less congested airports)
- No assigned seating
- No inflight meals
- Only one fair class
(Note that this demonstrates a lack of price discrimination. Whereas Ryanair do lots of it.)
|Learning Objectives: Understanding internal and external sources of economies of scale.
Spotlight on sustainability: Use of waste products