Student spreadsheet for case W15391.

On March 31, 2014, the vice-president of Sales & Marketing at Xiamen Airlines Co. Ltd. (XiamenAir) was reviewing the minutes of the month-end meeting with his team. The meeting had focused mainly on the rapid spread of high-speed rail in China, especially along the popular and profitable routes served by his company. The new train service might become an indirect, albeit potent source of competition, redirecting existing passenger volume from airlines to a much cheaper travel option. How would its growth affect the positioning of XiamenAir as a premium service, high-priced airline? How should the company respond to this development?