Ce
Center for Logistics, Trade and Transportation
1
and
College of Business
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
Coordinated by
Dr. Tulio Sulbaran
Tel: 601-266-6419 - Email: tulio.sulbaran@usm.edu
Panama Airlines vs. US Airlines: A Case
Study Comparing Copa Airlines to
Southwest Airlines
Presented by:
Kirk Gore
Tel: 601-434-3651 - Email: kirkgoremail@yahoo.com
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad
in Panama
Jul 2012
July 2011
Center for Logistics, Trade and Transportation
And
College of Business
Video Preamble
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Outline
1- Introduction
2- Information/Data Collection Approach
3- Case Study
4- Results and Results Impact
Similarities
Differences
5- Summary
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Introduction
• By definition, an airline is “an air transportation
system including its equipment, routes, operating
personnel, and management” (Marriam-Webster).
• The focus of my topic for this report is to compare the
positioning strategies between Copa Airlines and
Southwest Airlines to see what makes each airline
successful in their respective countries.
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Introduction
VS.
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Introduction
• Due to the economic impact of the Panama Canal,
Panama is one of the world’s fastest growing
economies.
• Copa Airlines is not only Panama’s most successful
airline but also the most profitable airline in the world.
• Panama only currently has 3 operating airlines, with
one only transporting cargo so the competition is
much less fierce than in the United States.
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Introduction
• This report takes an in depth look both at the market
conditions of the airline industries in both Panama
and the United States, and how Copa Airlines and
Southwest Airlines position themselves in their
industries to achieve sustainable growth and
success.
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Introduction
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Introduction
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Information/ Data Collection Approach
• The data collection approach was divided into 2
parts for this research paper:
• Internet Search and Panamanian Interview
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Information/ Data Collection Approach
• For the internet search, I searched for specific
keywords in Google to find out more about the
airline industries in Panama and the US.
• I also used Google to research preliminary
information about the strategies that both Copa
and Southwest implement to achieve success in
their respective countries.
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Information/ Data Collection Approach
Keywords used in Google search
Copa Airlines
Southwest Airlines
Panamanian Airline History
American Airlines Strategic Positioning
Southwest Airlines Strategy
Copa Airlines Field of Coverage
Southwest Airlines Field of Coverage
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Information/ Data Collection Approach
• From my internet research, I learned that:
• The US Airline industry is saturated with airlines,
making profitability very difficult..
• The Panamanian market has 3 airlines, with one
dealing exclusively in Cargo.
• Southwest Airlines employs a low cost strategy.
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Information/ Data Collection Approach
Joseph Mohan, the VP of Commercial & Planning
• For the second part of the data collection, I used my
iPhone to record audio and video from my
Panamanian Interview.
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Information/ Data Collection Approach
• From the Panamanian interview, I learned that:
• Copa Airlines employs a combination of a
differentiation/niche strategy to achieve a competitive
advantage in Panama.
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Case Study
• Brief Description of Copa Airlines:
•
•
•
•
•
•
•
Based out of Panama City, Panama
The official airline of Panama
7,900 employees
Publicly traded
Revenues of approximately $241,000,000 per year
The most profitable airline in the world
Differentiation/niche strategic position
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Case Study
Copa Airlines headquarters location:
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Case Study
• Brief Description of Southwest Airlines:
•
•
•
•
•
Based out of Dallas, Texas in the United States
37,000 employees
Publicly traded
Revenues of approximately $459,000,000 per year
Low cost strategic position
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Case Study
Southwest Airlines headquarters location:
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Results and Results Impact
• Aspects specifically compared between Copa
Airlines and Southwest Airlines:
•
•
•
•
•
•
•
•
Flight Destinations
Is said company the top performer in the country?
Revenue per Year
Countries Serviced
Airplane Fleet
Pricing Strategy
Destination Strategy
Number of Employees
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Results and Results Impact
• Similarities between Copa Airlines and Southwest
Airlines:
Similarities between Copa and Southwest
Criteria
Copa (Panama)
Southwest (US)
Destinations
64
97
Top performer in country?
Yes
Yes
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Results and Results Impact
• Differences between Copa Airlines and
Southwest Airlines:
Differences between Copa and Southwest
Criteria
Copa (Panama)
Southwest (US)
Revenue per Year
$241,000,000
$459,000,000
Countries Serviced
29
1
Airplane Fleet
79
550
Pricing Strategy
High Cost (High Quality) Low Cost (Low Price)
Destination Strategy
Highly Specialized
High Traffic Areas Only
Number of Employees
8,000
37,000
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Results and Results Impact
• Why are the similarities important?
• Why are the differences important?
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
Summary
• This research paper aimed to identify the differences
in positioning strategies between Copa and
Southwest.
• To collect the data, both internet research and a
Panamanian interview were used.
• The results indicate that while both airlines are the
most successful airlines in their respective countries,
they use very different strategies to achieve success.
• Copa uses a differentiation/niche strategic position.
• Southwest uses a low cost strategic position.
THE UNIVERSITY OF
SOUTHERN MISSISSIPPI
Study Abroad in Panama
July 2012
Center for Logistics, Trade and Transportation
And
College of Business
THE UNIVERSITY OF SOUTHERN MISSISSIPPI
founded in 1910
Thanks!
THE UNIVERSITY OF
SOUTHERN
Center for Logistics, Trade and Transportation
Center forStudy
Logistics,
Trade
Transportation
Abroad
in and
Panama
And
MISSISSIPPI
July and
2011
College of Business
College of Business