The Nature and Sources of Competitive Advantage

AirAsia: Case Study
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What are the sources of Air Asia's cost advantage?
Low Cost Carrier Model
One of the sources of the cost advantage for Air Asia is that it uses the low cost carrier model. The low cost career is created by the Southwest Airlines in America. AirAsia had incorporated the basic LLC model to the market, institutional and geographical features of South East Asia in its airline careers. At the same time, it preserves the principal operational features of the strategy (Grant, 2009). The main benefit associated with low cost airlines is related to the price of tickets. Although low cost airlines may not be having all the amenities that are available in other airlines, they enable the tickets to be reduced to a considerable percentage.
The low price charged on low cost careers in turn leads to increased demand for clients who want airline services that are affordable for them. Indeed, AirAsia has been able to realize this objective since they now have many clients wishing to travel at low cost. Although other airlines could claim that charging low cost is not sustainable, it could not be meaningful to charge high fees and have to travel with half full or empty aircraft. Similar to other markets, the low of demand and supply also works in the airline industry whereby it becomes necessary to reduce prices to the level where they will get enough clients to buy the tickets. It is not interesting then that AirAsia is boosting of high profit despite charging low prices.
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The preposition of AirAsia is base...