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However, as already mentioned, slumping demand in the early 1990's plunged the industry once more into a severe price war. Airline travel is a commodity-type product, with limited potential for differentiation.
Rivalry among Firms: High
Rivalry among firms within the airline industry is high because low cost airlines have entered the market forcing existing competitors to control costs. Intensely competitive industries generally earn low returns because the cost of competition is high or buyers are receiving the benefits of lower prices. Factors that affect competitive rivalry include industry growth, fixed cost, brand identity, and barriers to exit...
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