Cost Reduction Potential Of Ethiopian Airlines

Ethiopian Airlines, just like many other Airlines around the world, isrnsuffering from the black footprints of the skyrocketing fuel price. The existingrnfierce competition among rival airlines makes the situation aggravated.rnHence, unless otherwise it tries to keep costs as low as possible, thernsituation can result in significant financial losses and going into bankruptcy.rnIn this study, ' it is tried to assess whether Ethiopian Airlines has thernpotential to reduce its costs. Questionnaires had been distributed to selectedrnemployees and interviews had been conducted with selected departmentrnmanagers to collect the relevant data. Observations have also been ma de.rnFlight delays & cancellations, denied boardings, poor baggage handlingrnsystem, operating dissimilar aircraft family, unconsolidated andrnuncoordinated purchases, personal consumption of excess meal, beveragesrn& hygienic items, expiration of purchased chemicals, and increase in thernnumber of Aircraft components sent for foreign repair are found to be thernmajor findings of the study that take part in the increased costs of thernAirline.rnThe study shows that there is a potential for reduction in costs. The studyrnalso forwards some recommendations that can be used to mitigate thernproblem and prevent any negative con sequences on the present and futurernperformance of the company.

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