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Pestel Analysis of the Body Shop

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PEST Analysis

* Political

Malaysian Airlines was having the worst financial crisis in 50 years history before Dato' Seri Idris Jala becomes the CEO. During the crisis, MAS just had enough capital to last for around three years. Idris Jala has no experience in airline industry but still appointed by the government to take over MAS. Idris Jalas sets a condition that he wants 50% freedom from the government before take over the leader position. Government intervention in which required MAS to fly routes that didn't make any commercial sense become one of the problems. As a GLC (Government Link Company), MAS had no choice which made them abide to the requirement. Some government policy and initiatives actually benefited MAS. In year 2008, government give benefit like provided 50% rebate on landing charges for airlines under its stimulus plan (Izatul, 2010).

* Economic

Malaysian Airlines will affect by the higher fuel costs. The higher fuel cost will eat into the first-quarter profits (The Star, 2011). In March, The International Air Transport Association said high oil prices would cut the industry profits by nearly half year of this year (Manila Bulletin Publishing Corporation, 2011). The high oil prices were leading the Malaysian Airlines to increase their air-ticket prices to cover the cost that they use to cover the price of purchasing oil. According to Izatul (2010), in year 2008, MAS was facing the toughest year. Malaysian airlines were again hit by economic downturn.

* Social

According to Izatul (2010), as a developing country, the number of professional and educated people is increasing which make them change their lifestyle. People have earned more and willing spends their money on travel overseas. At the past, people are lack of confidence toward airlines. Most of the time, people are scared to fly. As a respond to the needs and wants from



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