Competition between Airbus and Boeing
- How and why is it chosen ?
- Its role and its impact on sales
Airbus and Boeing are the two main companies on the civilian aircraft market. They represent the main part of the sales on this marketplace and are hardly competing for the leadership every year.
These companies are present on a growing market, with growing passenger traffic and a growing cargo traffic that will force the airlines companies to invest in new aircrafts in order to answer to the demand. The developing countries also have a positive influence on the market because their economic development is boosting the airlines demand.
The civilian aircraft market can be divided between these two companies, Boeing was the traditional leader but after its creation in 1972, Airbus began to steal market shares and finally competed at the same level after 2000.
Nowadays these two companies are the symbol of hard competition and are implementing strategies, developing projects or models that are different in order to stick to the demand and to get the leadership on the market place.
Airbus is a European conglomerate born in 1970 with the merger of the main air and space companies in France, Germany, United Kingdom and in Spain. It has developed a large range from single aisle low range planes (A320?) to heavy carrier like the last evolution of the A340 or the A380. Airbus has conquered market shares thanks to its high level of technologies, the synergies effects between its model and its reliability.
Boeing is an American company; its official name is ?The Boeing Company?. The company was created in 1919, it sales military system of defense and aircrafts, and civilian aircrafts. Boeing was the leader on the aircraft market around the world, and has bought all its past major competitors like MacDonnell Douglas or Lockheed Martin. Actually the product range of Boeing is old with planes developed in the 1960's, but the company is developing new projects.
Actually the civilian aircraft market is a moving market due to the requirements of the airlines companies and to specific requirements of the economic situation. These airlines companies always had an important influence on the aircraft builders and on the development of their products because they have specific requirements. The aircraft builders have to adapt to their needs and requirements because they are their main customers.
The main airline concern is that the main hubs, that are airports where flights are changed, are overpopulated which gives them difficulties to operate, and creates delays in the flight schedule which means a lack of reliability for the customers.
The actual economic situation is also a problem for the airlines with the recording increase of the oil barrel; airlines had to make financial reserves to pay the oil for their flights which gave them a reason to focus on plane's consumption and autonomy. There is also a global ecologic pressure on the airlines.
There is also a concern about the environmental matter focused on the noise, because the planes are big noise producer, especially at the takeoff and landing moment when they are flying at a low level on people's house. There are already been law suit about this matter and the airlines are looking for less noisy planes in order to avoid law suits.
It can be established that the needs of the airlines have a direct impact on Boeing and Airbus and on their projects.
The states and governments also have an influence on the market because the aircraft field is a strategic field that represents a lot of jobs and money. They are helping the two companies in different ways.
On one hand, they are financing them in order to decrease the prices of loans and to improve profitability.
The US government is giving to Boeing military subventions that are used to develop technology that will be implemented on civilian aircrafts, whereas the European governments are giving refundable helps to Airbus, that the company will only reimburse in case of commercial success. These special financing methods have been a reason of complaints at the World Trade Organization.
On the other hand the governments are helping the two companies by negotiating sales with other states during diplomatic negotiation.
Tags: Airline Manufacturers,Boeing Airbus, Competitors