Presented by

• Tejas Gunde- 18

• Prashant Kotian– 31

• Meghna Shetty - 52
 Agenda

 Introduction
 Net Revenue
 Corporate Strategy of Both Airbus &Boeing
 Corporate Strategy Challenges faced
 Corporate Strategy Recommendation
Porter’s Five Forces Model
 Swot Analysis of Airbus & Boeing
 Corporate Strategy of Both Airbus & Boeing
 Business Strategy Challenges
 Business Strategy Recommendation
 Company Profile

• Airbus is a European joint venture between EADS • Formerly Pacific Aero Products Co.
(European Aeronautic Defense and Space Company) known as Boeing in Seattle.
and Britain’s BAE Systems. • Headquartered in Chicago (USA)
• Headquartered in Blagnac Cedex, France. • Founded - July 15, 1916
• Founded - December 1970’s • Business: Boeing products and
• Business: Design, manufacture and deliver industry- tailored services include
leading commercial aircraft, helicopters, military commercial and military aircraft,
transports, satellites and launch vehicles, as well as satellites, weapons, electronic and
providing data services, navigation, secure defense systems, launch systems,
communications, urban mobility and other solutions advanced information and
for customers on a global scale. communication systems, and
performance-based logistics and
• Presence- France ,Germany, Spain, UK, Russia, training.
Turkey, Finland
• Presence- Australia, Southeast
Asia, Japan, Republic of Korea,
China, Middle East, North Africa
and Turkey, Europe
 Major Milestone
 Boeing 747-
First flight of a wide-body and , turbofan-powered commercial
 Airbus has delivered its 10,000th plane
airliner
first one entered service over 40 years.
 2 bomber developed-
 January 2015- A350 XWB new-generation
jetliner has entered the services with Made of composite materials rather than metal with "flying
Singapore Airlines, Qatar Airways, Cathay wing" design.
Pacific, Delta Air Lines  Twin-engine 777-
 Total of 21 bio-fueled aircraft have so far The biggest two-engine jet ever to fly and the first aircraft
been delivered by Airbus since 2016. produced through computer-aided design and engineering
 Airbus inaugurated its A330 Completion  2018-GUINNESS WORLD RECORDS
and Delivery Centre in China in
737 program has more than 4,600 airplanes still on order fueled
September – the first widebody center
by sales of the newest version of the 737, the 737 MAX.
outside of Europe.
 Net Income of Airbus & Boeing

Airbus 2018 (Amount in Euro) 2017 (Amount in Euro)

Net Income Airbus (in millions) 3,054 2,361
% of Increase/Decline 29% -
Employees Net Income of133,671
Airbus & Boeing
129,442

Boeing 2018 ($ million) 2017 ($ million)

Net Income Boeing 10,460 8,906

% of Increase/Decline 40% -

Employees 153,000 140,800

 Corporate Strategy Of
Airbus
Defense and Security.
• It’s a division of Airbus
Airbus Helicopters, Inc. (AHI) responsible for defense
Airbus Corporate Jets- and aerospace products
• Its subsidiary of Airbus
• It’s a business unit of Airbus SAS and services.
Group, Inc
and part of Airbus • Corporate restructuring
• Headquarters is at United
• An Airbus Corporate Jet Centre is of European Aeronautic
States.
based at Toulouse and France. Defense and Space
(EADS), and comprises
the former Airbus
Military, Astrium, and
Cassidian divisions
Airbus follows the corporate strategy of its holding company EADS that is European aerospace company. Airbus is based in France and has extended operations in
Europe. Airbus produces about 50% of the world's jet airliners. With around 63,000 employee force, the company has designed more than dozen aircrafts. The company
had 4,682 aircrafts in December 2012 with a value of above $638 billion. The revenues and operations are ever increasing since its inception. The company supplies
aircraft to almost all the countries and has started diversifying its operations. The company has been challenged by Boeing in the aircraft industry but it maintain a
leading status in the industry.
 Corporate Strategy Of Boeing

Boeing Capital Boeing Shared Services

Boeing Defense, Space
• It provide asset- Group
Boeing Commercial & Security (BDS)
based leasing and • Broad range of
Airplanes (BCA) • They are responsible
lending services. services worldwide,
for defense and
• There are two including facilities
• Designs, assembles, aerospace products
division for Boeing
markets, and sells and services. services, employee
Capital benefits and services,
jet airliners and • It is formerly known
• Aircraft Financial recruitment, wellness
business jets. as Boeing Integrated
Services and Space programs, security,
• Headquarters in Defense Systems
& Defense Financial
Renton, Washington (IDS). fire protection etc.
Services • Shared Services
• Headquarters in
• It support the main Group manages the
Greater St. Louis.
business sale and acquisition
The corporate strategy of Boeing is running core businesses, leveraging of all leased and
powers in new areas, and starting new operations. owned property
 Strategic Challenges at Corporate
Level
Airbus Boeing
 A class-action lawsuit and the threat of
more litigation accusing management  Allegations of illegal subsidies on both
of hiding problems. sides before the World Trade Organization
 Airbus has dilemma to invest its capital
 Whether to locate a Production assembly
in One of the business out of Three
line outside of Washington state.
business units which its currently
operating in.  New avenues of growth for leasing and
lending services (Boeing Capital).
 In-fighting by French and German
executives at the parent company,
European Aeronautic Defense and
Space Company (EADS).
 A management shakeup at Airbus
 Recommendations for Corporate
Strategy
Airbus Boeing

 Airbus must create examples in terms of business  Assign a strong personality to

procurement decisions ,outsourcing , environment
regulation and business direction. administer the process
 The managers should be equipped with skills,  Develop benchmarks for performance
resources and staff in order to display there best and results
performance and high productivity.
 Anticipate how the strategic planning
 Airbus must grow by acquiring expertise , business
operations and entering into new market. changes will affect your employees,
processes, and culture
 Airbus must test technology and select long terms
deal with supplier. It should not select the  Publicize the strategic plan early on and
technology and supplier Incase of failure of test . regularly
 Outsourcing the operations will help to risk
diversify of business operations.  Monitor the plan’s progress and make
changes when necessary
Common Business - Commercial
Airplanes
 SWOT ANALSYIS FOR Airbus
Weakness
Strengths
 Lack of performance in defense and space
 Strong momentum in commercial Aircrafts segment
Competitive portfolio due to strong blacklog  Slow moving demand of Helicopters.
Strategic fields action for Ramp-up  Compliance irregularities leading to
 Global player with leading market share corruptions problems.

Opportunities Threats
Growth opportunity in developed economies. Cyber Security risks
Achieve global market leadership in defense  Stiff Competition from other Global players.
and space segments
Over-dependence on Suppliers
 Development of Unmanned Aerial Systems
(UAS)
 SWOT ANALSYIS FOR Boeing
Strengths Weakness
Consistently strong financial performance High Pension spending
over the years
Large Market share and global presence  Trade dispute between Boeing and
Bombardier impacting Boeing’s Defense Sales
Reputed customer base
 Weak operational performance in defense
 Technology innovation with strong spend in and space segments.
research and development

Threats
Tough Competition from Airbus in Terms of
Opportunities Production capacity
 Strong long term air Travel market Outlook  Dependency on United States political
 President Trump boost to the navy fighter Jets polices .
Global ban on the controversial Boeing 737
MAX
 THREAT OF SUBSTITUTES: Low
Overall Industry
 Introduction of New technologies are Attractiveness:
evolving constantly
High/Moderate
 Factors that minimize the threat from
the substitutes are quality, technology,
and customer convenience.

SUPPLIERS POWER: Low BUYERS POWER

 There are around 7700 suppliers  All established companies are competing :Moderate
INTENSITY
which are part of supply chain in this industry have grown Intense.  Customer wants to have the
OF  Customers have options in choice brands
 Both the companies have upper hand most fuel efficient and
in terms of fuel efficiency or technology.
because they are major buyers. RIVALRY:  Both the companies are loaded with technology rich aircraft.
backlog, there is constant pressure  Brand image and high
 The supplier have low bargaining HIGH related to quality and safety.
power due the size of the companies quality products
 Both the companies have
THREAT OF POTENTIAL ENTRANTS: Low some great aircrafts whose
demand is very high
 Large financial investment in infrastructure
and supply chain.
 Finances to pay your skilled human resources
 Regulatory barriers like licenses and permits
 Business Strategy Of Airbus -
Commercial Airplanes
 Product Events: Guests are invited to view and tour the aircraft at selected
stopovers, and were treated to champagne with Airbus executives, test pilots,
and engineers.
 Look to Other Segments to Build Sales Momentum: Since Airbus couldn’t get
at their primary segment (the US market), they turned to their secondary
markets — in this case Korea, India, and South Africa. While they only won a
handful of orders it was proof positive they could sell the A300 outside of
Europe.
 Customize the Product to Make the Sale: Airbus offers longer range version to
meet customer needs.
 Develop a Value Proposition Relevant to the Business: Airbus knew their
product was more advanced and efficient than the competition. Airline
constantly tries to get their costs in line.
 the company has deliveres to 14 airlines. They were on their way to becoming
a giant in the aviation industry.
 Challenges of Business strategy- Airbus

 Airbus continued to have problems and delays with its production.

 The company is expected to report a 7 percent drop in full-year core earnings and confirm that
orders for new planes this year will drop.
 Culture Clash - The internal overhaul also brings a shift in power from heavyweight engineers
to a new breed of managers.
 The Airbus A380 sales continued to struggle, with a small Emirates order (which was delayed).
Lufthansa was rumored to be ordering the aircraft, but this did not materialize.
 They were unable to negotiate new contracts for other Variants.
Business Strategy Of BOEING -
Commercial Airplanes
 It becomes essential for the management of the company to maintain world
class Information Technology to meet the deadlines
 Company is developing solutions for cost effective exploitation of their
aircrafts providing fuel efficiencies and rapid reconfiguration of seating
layouts to optimize the ratio of seat occupancy for passenger class.
 In addition, a well framed technology is also required for the rapid product
development and manufacturing cycles. As a result of this, the speed of
transforming the concepts in production is increased to a great extent.
 Challenges of Business strategy-
Boeing

• Increased competition in a this segment from Airbus.

• Insufficient Supply chain capacity to accommodate increased aircraft production rates.
• Production cuts because airlines are postponing jet deliveries, cutting back on new purchases and
canceling orders
• Initiating measures to reduce brand image deterioration caused by failure of model 737max.
• Frequent changes of Government rules and safety measures are impacting the production of Boeing.
• Safety features Ad-ons are costly and expected to provide for free.
 Recommendations for Business
Strategy- Airbus

 Airbus should have a clear strategy and should make plan for making fuel efficient
carriers.
 Designing of aircraft should as per the runway requirements of airports worldwide.(for
landings and takeoffs to accommodate its huge A-380.)
 Increase in airbus ability to produce by increasing or outsourcing there manufacturing
process and increase number of suppliers
 Develop and publicize workplace policies and procedures that organize work
effectively.
 Recommendations for Business
Strategy- Boeing

 Boeing should carefully outsource to avoid major accident and protect its brand
image.
 Reward the positive behavior of supportive employees and take appropriate action
against those who fail to participate productively in the process.
 It would have helped if Boeing had adopted 3D simulation software to there safety Ad-
on technology.
 Company should not compromise on the safety measure and should try cutting cost
where it won’t hamper brand image.
 Bibliology

 https://notesmatic.com/2017/12/boeing-five-forces-analysis/

 https://store.marketline.com/report/mlpm0004-007--airbus-se-company-strategy-
performance-analysis/

 https://bizcoachinfo.com/archives/1326

 https://www.paperdue.com/essay/airbus-corporate-strategy-business-level-90506