Case Study Analysis 1 commercial aircrafts were unsuccessful not
until they released the 707 that won over
Boeing and Airbus: A Global passengers with its shorter time flight and
Competitive Battle over smooth travel. This was followed by the 727
Supremacy in Producing trijet and 737 twin jet, the latter which had
become the world’s most best-selling
Commercial Aircraft commercial plane.
Submitted by: But in 2001, Boeing lost its ground
Marjorie Pagsinuhin and Airbus led the market. Formed under
European consolidation-Concorde in the
Submitted to: hopes of being independent from the US
Mrs. Aleli C. Dugan, CPA, Ph. D manufacturers and creating new jobs, the
Airbus Industrie began developing their own
aircrafts, starting with the A300 in 1970.
Introduction Companies from all over Europe joined the
consortium and Airbus earned a deserved
Boeing and Airbus are considered as
reputation. They snatched the top position of
the top two leader companies that
aircraft industries in 2001, after focusing on
dominated in the aircraft manufacturing
the midsized market as well, using the A-320
industry. Boeing always has been the
strategy, which competes with Boeing’s 737
preferred commercial aircraft in 1958, since
and 757 aircraft.
introducing its 707 model to the public.
However, Airbus, Boeing’s main rival, had Shortly after, in 2006, Boeing
overtaken Boeing for the first time in the regained its position beating Airbus’ super
history, having the greater number of orders jumbo A-380 with the 787 Dreamliner.
for commercial planes, the A-320 being the
more efficient aircraft.
External Analysis
The purpose of this case study is to a)
present the strategic analysis of the two Only the two companies, Boeing and
manufacturing companies, c) come up with Airbus dominated the aircraft manufacturing
a strategic marketing plan for Airbus to industry during the end of the 20th century
overcome the competition against Boeing until the early 21st. The Porter model of
once more. competitive industry structure discusses the
key entry barriers which presumably led to
this.
History of Boeing and Airbus
1. Economies of scale
Formerly known as Aero Products 2. Product differentiation
Company, the Boeing Airplane Company 3. Capital requirements
was first established by William Boeing and 4. Switching costs
Conrad Westervelt after developing a single 5. Access to distribution
engine, two-seat seaplane. While their
military aircrafts were a big hit, their
Establishing an aircraft manufacturing size jet market, as it is the current market
industry requires a large amount of trend for commercial aircrafts. They have
resources. Considering how to meet the already spent a huge 12B dollars on the
capital requirements is only one of the major A380, they only need to continue improving
concerns of aspiring entrants, gaining more its features and promote it across different
advanced technology and overcoming platforms (e.g. social media) that enables
customer loyalty are another. Highly skilled, the customers to publicly share their
professional and well-educated workers are comments and experiences during the flight.
demanded. Boeing and Airbus are two large
companies which can produce goods at
lower costs than small, inexperienced firms.
Internal Analysis
The two companies are already
worldwide known quality manufacturers and
has a large market. Their focus is about
expanding the product line and domineering
the industry. Before they reached their
current status, they spent decades and
billions into Research and Development,
quality control, hiring experts, and allocating
budget to backlogs which satisfied the
customers.
The most efficient strategy for the two
to dominate the market is based on how they
want to satisfy the customers through their
product designs, with the help of customer
feedback.
Airbus won the competitor battle that
occurred between 2001 and 2005 because
the A-320 was more efficient than the aircraft
used by Boeing, and Boeing did not respond
to customer demands to create new, efficient
aircraft. In fact, it had slowed its innovation
process in regard to new models, Hitt et. al
(2009)
Airbus: A More Competitive Strategy
In order to gain advantage against the
competitor, Airbus should focus on the mid-
