Airbus A3XX Case Study Analysis Introduction of Boeing and Airbus In the United States, Boeing was the primary civil aviation manufacturer for over half a century. Using manufacturing and defense techniques, it soon became the world’s top producer of commercial aircraft. Of their fleet consisting of fourteen models (five families), their forerunner was the 747-400. When they first produced the 747 in 1965, their decision was criticized and called a gamble. Nonetheless, Boeing announced an initial order of 25 planes which, as a result, caused their stock prices to increase 5.1%. In spite of an initial potential failure, Boeing’s demand for the 747 aircraft continued to stay strong with 47 planes delivered in 1999 and 74 more in their backlog. In competition with American aircraft companies, such as Boeing and McDonnell Douglas, Airbus was formed in 1970 as an association with “principal aerospace companies of Germany (Deutsche Aerospace …), France (Aerospatiale Matra), England (Britain’s Hawker Siddeley, later BAE Systems), and Spain (Construcciones Aeronauticas, CASA)” (pg 3). The company primarily focused on creating a highly competitive line of commercial aircrafts. Though, overtime, the partnership between the four countries became unmanageable and three of them formed a new company known as European Aeronautic Defense and Space Company (EADS). Airbus, one of the leading divisions in this new company, had a fleet of nine models by 1999 and “employed ‘fly-by-wire’ technology that substituted computerized control for mechanical linkages between the pilot and the aircraft’s control surfaces” (pg 3). The A3XX Boeing held the monopoly in the very large aircraft (VLA) market with their 747 airplanes. Airbus made a de... ... middle of paper ... ...gy to make it more powerful and attractive than the Airbus A3XX. With the potential for this project to take some time, Boeing may have to work quickly to catch up to Airbus. Airbus’ Commitment The decision for Airbus to commit to the project is a tough one to make. On one hand, it is possible that all of the early investors may receive discounts thus causing Airbus to lose money. However, on the other hand, it’s possible that Airbus would make even more money than they ever imagined by designing an aircraft that attracts passengers worldwide due to the greater amount of space, details, and comfort provided in each model. Furthermore, because the VLA market is expanding quickly, Airbus is able to enter that market at an early period. If the company continues creating new aircraft and strategizing well against others in the market, they may soon become a leader.
It's expected that in the first few years, Boeing will incur more expenses than income. Revenues will come at a later date when the 7E7 planes are delivered. The project will have to be evaluated periodically and management will have to make changes to ensure that the company is profitable based on current and future conditions. The board's prerogative is not to give Airbus a profit sanctuary' by not accepting the project, but rather to maintain or increase its market in the industry even if it's not profitable in the short-run. Boeing has deep pockets and should be willing to challenge its competitors.
The SWOT process will start by examining the internal strengths of the Boeing Company of today. One of the most dominant strengths possessed by Boeing is its ability to follow the changes in a market that is continually changing. The type of products produced by The Boeing Company demands the use of state of the art technology while maintaining all the proper safe guards for sa...
The Boeing Corporation is one of the largest manufacturers in the world. Rivaled only by European giant Airbus in the aerospace industry, Boeing is a leader in research, design and manufacture of commercial jet airliners, for commercial, industrial and military customers. Despite enjoying immense success in its market and dominating an industry that solely recognizes engineering excellence, it is crucial for Boeing to ensure continued growth through consistent strategy formulation and execution to avoid falling behind in market share to close and coming rivals.
Including the Boeing 747 is important in comparing the safety records between the two main aircraft manufacturers because of its popularity. From Boeing’s website, the 747 fleet has flown more than 5.6 billion people–about 80% of the worlds population since its first flight in 1969. There are also 838 planes in service in the Boeing 747 family. In the past six years the 747, Boeing’s flagship plane has incurred six acciden...
As aviation matured, airlines, aircraft manufacturers and airport operators merged into giant corporations. When cries of "monopoly" arose, the conglomerates dismantled.
Boeing has looked at everything from the design of the anti-collision lights, to the reduction of small gaps in the airfoil. This has created an aircraft that is extremely aerodynamic and efficient at any task it performs. The 737 was originally created on May 11, 1964, however it wasn’t until November 9, 1964 that production was officially approved. On February 19th 1965 Lufthansa placed its first order for the 737-100, and on the 9th of April 1967 the 737 flew for the first time. In 1970, Boeing had less than 35 orders for the 737 and considered canceling the program.
The new entry is likely from rich Gulf nations, China, and India of low budget planes around the globe. The airlines from the Gulf nations have placed orders with Airbus and Boeing that are valued in the billions. The deliveries are expected in the next decade. The demand will grow in the production of advanced narrow-body airplanes, such as Airbus, A321 and Boeing, B737 Max. The growth that is expected in the next decade, more consumers will be flying to their destinations. The airlines in the United States are expected to have a profit margin over the next decade. Resulting, from economic growth, and the demand for aircraft service. Buyers are expected to have a lot of power in the next decade, resulting in bargain prices for buyers. The competition will increase with intense rivalry in the aviation industry. The contracts for the aircrafts are totally from airplane
Technology Innovation: - Boeing should carefully analyze the market to evaluate the trends in the airline industry and aggressively invest in a new product line (top dog strategy) that could counter Airbus’s A380.
Gaining a substantial market power in the commercial aviation industry allows for significant impact on technological development, economic growth, employment, and national prestige (Carbaugh & Olienyk 2004). In 2010, more than any manufacturer sector, the value of aerospace industry shipment in the US accounted for more than $171 billion of civil aircraft and a trade surplus of more than $43 billion (Harrison 2011). Like any other industry, large commercial airplane industry gets affected by macro, endogenous, and exogenous factors. Several factors may influence the industry i...
Boeing was founded in 1916 in Seattle, Washington by William E. Boeing. The company is regarded as one of the world’s leading manufacturer of commercial and military aircrafts; it controls more than half of the passenger aircrafts’ market in addition to military jets and helicopters. The company also has other contributions in space technology and projectile systems (Amir, 2013). This report will analyze Boeing Company’s latest marketing strategy that the company has been dealing with for the past five years whilst the production of its much anticipated 787 aircraft. Throughout the report the aircraft will be referred to as the 787, the ’87, or the ‘Dreamliner’. Mainly, this failed strategy affected the company's negatively in terms of both sales and reputation.
When the war ended, the military’s demand for airplanes ceased. Even civilian planes met limited demand. Boeing Airplane Co. was competing with war-surplus airplanes. In order to survive, the company began building furniture and sea sleds. Although Boeing received limit...
This essay deals with the growth of the aviation industry based on the demand for air travel. Therefore, will touch upon the structure of the aviation industry and the stages of development that can create an impact on it. This assignment will also cover discussions and evaluation based on the implications of the changes for the aviation industry.
Boeing 787 Dreamliner was first announced to the public in January 2003 with approximated costs of five billion dollars , since the sales of the aircraft were high it was supposed to enter commercial service during 2008 but the building up of aircraft seemed more anticipated than expected , since the management decided to use composite materials as an alternative for traditional metals as composite materials are lighter , stronger , cheaper and also resistance to wild variety of chemical agents including acid rain and salt spray as these are the conditions under which metals suffer , Boeing also shared their views in development of air craft with suppliers which effected in a project significantly more anticipated than expected . More than three years later after the project exceeded the estimated budget at last 787 entered commercial service in September 2011.
Airbus A380: How the Airlines Compare." Busineesstraveller.com. Panacea Publishing, 31 Aug. 2013. Web. 1 Dec. 2013.