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Abstract

This is the first of a two-case series. Delta Air Lines was the third largest airline in the US in terms of revenue in 2005. Like many of its competitors, Delta was facing continued liquidity pressure since the terrorist attacks on September 11th 2001. The demand for air travel reduced, while the cost structure of the airlines did not allow for reduction in costs. Low cost airlines were gaining market share at the cost of traditional full service airlines. In the times of such competitive dynamics, many of Delta's competitors underwent financial and operational restructuring exercises to survive in the industry. Delta, faced with similar issues, was exploring various strategic options in order to survive the competition.
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April 2007

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Abstract

This is the first of a two-case series. Delta Air Lines was the third largest airline in the US in terms of revenue in 2005. Like many of its competitors, Delta was facing continued liquidity pressure since the terrorist attacks on September 11th 2001. The demand for air travel reduced, while the cost structure of the airlines did not allow for reduction in costs. Low cost airlines were gaining market share at the cost of traditional full service airlines. In the times of such competitive dynamics, many of Delta's competitors underwent financial and operational restructuring exercises to survive in the industry. Delta, faced with similar issues, was exploring various strategic options in order to survive the competition.

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Location:
Industry:
Other setting(s):
April 2007

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