• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Collision Course in Commercial Aircraft.

Extracts from this document...

Introduction

Nile W. Hatch Marriott School - BYU Instructions for Airbus A3XX: Developing the World's Largest Commercial Jet In this case, we will be analyzing strategic interaction between Airbus and Boeing, the two leading producers in the global commercial aircraft industry. In particular, we will be considering Airbus' proposed launch of the A3XX, their entry into the intercontinental jumbo jet segment, and Boeing's potential competitive responses to this entry. We will attempt to answer the questions: Should Airbus enter the jumbo jet segment? If so, how? And, what should Boeing do about it?1 An appropriate analysis of this situation requires the integration of a variety of tools and concepts to which you have been introduced both in this course and the rest of the MBA curriculum. In particular, you will use cashflow analyses of the different scenarios that could play out in this industry and attempt to understand which of these scenarios are more likely to occur by applying game theoretic reasoning to this situation. Based on this analysis, you will then make recommendations concerning what your team thinks Airbus or Boeing should do2. While your quantitative analysis of this situation should form a basis for your recommendation, you should certainly consider other factors you deem important (but not accounted for in the model) ...read more.

Middle

This principle refers to the idea that when attempting to determine what your course of action should be in a given situation, it is important that you consider the potential responses a competitor may use. If you can anticipate how a competitor is likely to react in a situation, you can pick your actions contingent on those potential responses, thus, improving your performance. Throughout this quantitative analysis of Airbus vs. Boeing, you have been applying the principle, "Look forward, reason back." When you account for the pricing strategy used by Boeing when determining Airbus' pricing strategy, you are applying this principle. When you consider the outcomes of the pricing competition between Airbus and Boeing while deciding whether to launch a new jumbo jet, you are once again making use of this important principle. When you attempt to figure out whether Airbus should launch the A3XX based on Boeing's potential responses to Airbus' strategy, once again you are "looking forward (to Boeing's response), and reasoning back (to figure out what Airbus should do)." Thus, this fundamental principle is nested throughout the analysis. Exercising Judgement in the Use of Quantitative Analysis The exercise of constructing a quantitative model of a business situation is valuable for a number of reasons. ...read more.

Conclusion

So, as the price for aircraft goes up, the expected level of demand goes down. Second, airlines decide whose aircraft they will buy based on who provides the best efficiency advantage. In this model, your market share is equal to the efficiency advantage you provide relative to your competitors. Having this factor included in the model means that Airbus has slightly more pricing flexibility relative to Boeing because the A3XX is 20% more efficient than the Boeing according to case. However, we can assume that such an advantage disappears if Boeing launches a new plane. This leads to another point. The model explicitly assumes that operational efficiency is the only form of differentiation advantage available to Airbus and Boeing, but there are others. For example, we might expect the design of the passenger cabin, etc. would be important to Airbus' and Boeing's customers, the airlines. In addition, Boeing probably has more brand name and reputation capital than Airbus. After all, the 747 has been flying for 30 years with one of the lowest accident records of any aircraft. These are just a few examples of the types of issues you can think about. Obviously, given the space constraints that you face, you can't write about everything, and you need to prioritize your analysis. But, it is good practice to think in pretty broad terms about these issues. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our AS and A Level Marketing & Research section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related AS and A Level Marketing & Research essays

  1. Marketing Analysis and Strategy Recommendation for Starbucks Coffee Company

    (www.marketwatch.com/news) Nevertheless, it still only amounts to about one cup per person per annum and the brand typically is instant Nescafe.

  2. Strategic Analysis of Woolworths

    Source: Datamonitor (23 Mar. 2007) 2.2.1(a) Strengths Strong financial position Woolworths has achieved impressive financial performance in the past few years, with continuing sales growth in most of its business, such as Safeway Supermarket, Big W, Dan Murphy's, Dick Smith, et cetera, and at the same time reducing its operating costs (Fifield, 2005, p.

  1. For this assignment I have been asked to produce a new marketing strategy for ...

    this will help to attract consumers, as Coca Cola is a well-known company around the world. ? Packaging- packaging is very important, as it is the first thing that catches people's eyes. I will try to make my new strategy attractive as I can, I will include pictures of blackcurrant so it will show customers immediately what flavour it is.

  2. Unit 2 Investigating business

    questionnaire, this will be a great help for me in deciding key features of my business! Analysis of results I have asked a variety of different people from different age groups and of different genders, to fill out my questionnaire.

  1. Applied Business Studies

    Another weakness of my business may be that I have to meet specific deadlines, but I can't, and if that's the case, then I would be under pressure, which could stress me out. OPPORTUNITIES One of the main opportunities that I have got for my business is to develop it and expand it, and begin to use the internet.

  2. Marketing analysis of Marlboro cigarettes

    Advertisement Analysis Image of Marlboro Marlboro is a brand of cigarettes, the "Marlboro Country" and "Marlboro Man" is today widely recognized symbols of American culture and commerce, and both in the United States and around the world and the Marlboro Man are Wayne McLaren and David McLean, both of them has died of lung cancer.

  1. GLOBAL STEEL INDUSTRY DEVELOPMENT

    Import of steel (carbon, alloy and stainless) during 200102 was about 1.50 million tonnes, which was 17.43% less than imports in 2000-2001. The total import of steel, pig iron and scrap during the last five years and value thereof was as under: (b) Export of Steel The general policy and procedures for export and import of iron

  2. Applied Business Unit 2 Coursework

    of the skills the candidate needs As I have said if the candidate does not show evidence of having the skills needed to carry out the job role then he would not be the most suitable candidate and there would be no point in applying.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work