Aircraft Manufacturing Industry : Aircraft Engines

Aircraft Solutions (AS) is a recognized leader in the design and fabrication of component products and services for companies in the electronics, commercial, defense, and aerospace industry. Located in Southern California, AS has a dedicated, trained workforce and maintains a large capacity plant and extensive equipment to meet customer requirements. Much of the equipment is automated to increase production while reducing costs. The company's workforce has a large skill base: design engineers, programmers, machinists, and assembly personnel to work its highly-automated production systems.

During World War II, the aircraft manufacturing industry took-off. According to Dr. Bright (1978), “by the year 1944 it was the largest industry in America” (p. 1). It soon declined in the years following due to material flaws, lack in engine performance, and production manufacturing methods.

Boeing adopted the radical change approach for designing and developing the 787 Dreamliner not only to attempt to create new aircraft through the innovative design and advanced material, but it also drastically changed the production process. With a $10 billion dollar project in mind, the goal was to reduce the financial risks involved as well as the new product development cycle time. Meanwhile, Boeing produced a remarkably complicated supply chain that included greater than fifty partners in over 100 locations all across the globe. In addition to the complicated supply chain, they experimented with various firms in diverse areas to align complementary skill sets. Furthermore, this was the first time the company outsourced the two most crucial parts of the plane, the wings and the fuselage.

As a manufacturer of transportation equipment, Bombardier is well positioned in the aerospace and transportation segments to capture long-term market opportunities in Business Aircraft, Commercial Aircraft, and Aerostructures and Engineering Services (Bombardier Inc., 2014). These opportunities are expected to continue to rise due to accelerating urbanization and the rising need for mobility (United Nations, 2014). Furthermore, the state of the world economy and those of individual countries are key factors in the demand of air travel.

With only a few large companies across the globe (Boeing, MD, and Airbus), the commercial aircraft industry essentially exhibits the qualities of an oligopolistic competition with intense rivalry. Here is an analysis of competition in the commercial aircraft business using Porter’s Five Forces.

Today, the Lockheed Martin Corporation is headquartered in Bethesda, Maryland and employs 126,000 people worldwide. The company is principally engaged in the research, design, development, manufacture, integration, and sustainment of advanced technology systems. Lockheed also serves both domestic and international customers with products and services that have defense, civil, and commercial applications, with their principal customers being agencies of the U.S. Government. In 2011, 84% of their $45.8 billion in net sales were made to the U.S. Government, either as a prime contractor or as a subcontractor. Lockheed’s U.S. Government sales were made to both Department of Defense (DoD) and non-DoD agencies. Sales to foreign governments (including foreign military sales funded, in whole or in part, by the U.S. Government) amounted to 15% of net sales in 2011. The remainder of net sales was attributable to commercial and other customers. In 2011, net sales at Aeronautics of $13.2 billion represented 29% of their total net sales. Aeronautics has three principal lines of business and the percentage that each contributed to its 2011 net sales was 68 percent combat aircraft, 20 percent air mobility, and 12 percent in other aeronautics programs. At December 31, 2011, we operated in 545 locations (including offices, manufacturing plants, warehouses,

This is a case about three different companies dedicated to the manufacturing of aircrafts. Those three major companies are: Boeing, Airbus Industry and McDonnell Douglas; each of one was struggling to produce enough aircraft to satisfy a seemingly unquenchable need for passenger and freight transport around the world, developed in this form many kinds of aircrafts in different models and styles.

Due to customers’ needs and requests, Boeing has expanded its product line and services. The long tradition of aerospace leadership and innovation has given the company the advantages. Its broad range of capabilities includes creating new and more efficient commercial airplane, integrating military platforms and defense systems through

Dominating the commercial aircraft market for decades, Boeing is considered to be the most highly competitive U.S aerospace industry. “U.S. firms manufacture a wide variety of products for civil and defense purposes and, in 2010, the value of aerospace industry shipments was estimated at $171 billion, of which civil aircraft and aircraft parts accounted for over half of all U.S. aerospace shipments. The U.S. aerospace industry exported nearly $78 billion in products in 2010, of which $67 billion (or 86% of total exports) were civil aircraft, engines, equipment, and parts” (Harrison, 2011). However, its position of influence has lessened in recent years. This is due to its main competitor, Airbus, who in recent years has made significant

Boeing’s management plan shows determination to improve through creation of new more members of their airplane family (commercial airplanes). This would also be achieved through integration of military platforms, systems for defense and the war fighter by use of network-centric activities. Boeing plan is also inclusive of creation of improved technology to solve problems across all business units. Boeing plans to e-enable airplanes where automation is the key to this development. Finally, Boeing is determined to arrange for financing solutions to its customers. Through this it will be able to attract more potential customers. Moreover, it can also be able to establish a better relationship with its customers through provision of incentives and sales promotion.

The Boeing Company has registered strong growth in the developing markets in China, Oceania and Africa (Boeing Frontiers, Nov. 2005). For the fiscal year 2005, revenues from China grew by 87.9%; revenues from Oceania grew by $32; and revenues from Africa grew 61.8% over the 2004 fiscal year. These regions represent some of the fastest growing economies of the world. The Boeing Company's growing market share in these regions would boost the company revenues of the future (DATAMONITOR).

It is difficult to enter into the plane manufacturing industry because of the capital needed to enter. The amount of money and expertise needed to make even one plane is around 200 million dollars. For this reason, there are

The Boeing Company designs, develops, manufactures, sells, services, and supports commercial jetliners, military aircraft, satellites, missile defense, human space flight, and launch systems and services worldwide. It operates in five segments: Commercial Airplanes, Boeing Military Aircraft, Network & Space Systems, Global Services & Support, and Boeing Capital. The Commercial Airplanes segment develops, produces, and markets commercial jet aircraft for various passenger and cargo requirements; and provides related support services to the commercial airline industry. This segment also offers aviation services support, aircraft modifications, spare parts, training, maintenance documents, and technical advice to commercial and government customers. The Boeing Military Aircraft segment researches, develops, produces, and modifies manned and unmanned military aircraft, and weapons systems for global strike, vertical lift, and autonomous systems, as well as mobility, surveillance, and engagement. The Network & Space Systems segment researches, develops, produces, and modifies strategic defense and intelligence systems, satellite systems, and space exploration products.

Aircraft maintenance is very important for aviation industry and Aircraft are required to be maintained after a period of calendar time or flight hours or flight cycles. Aircraft maintenance is the inspection, repair, overhaul, modification of aircraft or aircraft component. Aircraft maintenance generally includes such tasks those tasks required to restore or maintain an aircraft’s systems, components, and structures with Airworthiness Directives or Service Bulletins and this is highly regulated, in order to ensure safe and correct functioning during flight. Aircraft maintenance requirements vary for different size and types of aircraft, experience which most aircraft need various type of preventive maintenance every 25 hours or less of flying time, and minor maintenance at least every 100 hours. Maintenance is influenced by some kind of operation, climatic conditions, storage facilities, age, and construction of the airplane. The profession of Aircraft maintenance requires extreme knowledge and adept expertise in performing the ingrained tasks. The aircraft maintenance engineer who is on duty he has a great responsibility to work professionally to ensure the safety of aircraft, customers and maintain the reputation of the team or company. The aircraft maintenance engineer normally works in an aircraft hangar and line maintenance and The aircraft maintenance engineer will undertake a number of processes including They may specialize by working on particular aeronautical

The heavy equipment manufacturing industry, more commonly referred to as “machinery manufacturing,” includes construction equipment, mining equipment, and agricultural machinery. Construction machinery includes earthmoving equipment, concrete equipment and road equipment such as cranes, loaders, draglines, mixers, pavers, and excavators that can be used in the building and mining industries. Agricultural equipment generally refers to compact tractors, combine harvesters, and other farm equipment, while the mining equipment market includes underground mining equipment, portable drilling rigs and parts, crushing machinery, and other screening, washing, and combination equipment.