Delta Airlines is an American major airline that provides transportation to more than 300 destinations in 55 countries; it is the world’s second-largest airline by revenue, after American Airlines. The airline’s headquarters are located at hubs around the country including Atlanta, Cincinnati, New York City, and Salt Lake City. The company was founded on May 30th, 1928 by Collett E. Woolman and has a strong focus on corporate social responsibility related to safety, trustworthiness, diversity, and sustainability within the community. Let’s go over Delta Airlines Porter’s Five Forces Model.
Delta Airlines Competitive Rivalry:
Delta Airlines is in direct competition with other airline companies such as American Airlines, United Airlines, and Southwest Airlines. The airline’s rivalry is based on price wars, product differentiation, and services. In order to be successful, Delta Airlines must focus on the needs of its customers by providing competitive prices and flight services that meet customers’ expectations.
Delta Airlines Bargaining Power Of Suppliers:
The airline’s bargaining power of suppliers is medium because the company does not have any sole supplier for its products and services. Delta Airlines must negotiate with suppliers to get the best deals for their products. The negotiations can be based on price, delivery, and product quality.
Delta Airlines Bargaining Power Of Buyers:
The airline’s bargaining power of buyers is high because the company has a lot of substitutes for its products and services. If Delta Airlines does not meet the needs of the buyers, then they can easily switch to another airline company. The company also faces a lot of competition from other forms of transportation such as bus, train, and car rental companies.
Delta Airlines Threat Of New Entrants:
The airline industry, in general, is very competitive and expensive; companies who enter this sector must consider the amount of money it will take to maintain a presence in the market. A new airline company must consider this before entering the market, however Delta Airlines is very well established and has a good reputation which can also be beneficial to new companies entering the sector.
Delta Airlines Threat Of Substitutes:
Delta’s most important substitutes are trains and cars, however, these companies pose a minimal threat because there simply isn’t enough room for passengers. Delta Airlines provides large airplanes with the capacity of carrying hundreds of passengers making it difficult for new companies to compete with their services.
Delta Airlines Porter’s 5 Forces Conclusion:
Delta Airlines faces threats from substitutes, this is counteracted by their brand name and strong reputation which is difficult to compete with. The company also faces medium bargaining power from suppliers and strong bargaining power from buyers; however, this is counteracted by their competitive rivalry within the industry.