CASE STUDY BOEING VERSUS AIRBUS Q. No. 1.

What are three reasons for the Europeans creating the Airbus consortium? Answer: 1. The first reason for the construction of a consortium for Airbus is to get government support for funding and political backup in order to get a safeguard against United States companies Boeing and McDonnells. 2. The second reason for the construction of a consortium for Airbus is that EU also aimed to enter in the aircraft industry due to increased use of the air services around the world. There was a gape in the demand and supply situation and EU was interested to fill that Gap 3. The third reason is given the growth of international travel, there would be a continual need for new commercial aircraft, and Airbus wanted to be a major player in this industry. Q. No. 2 How will Airbus help the EU compete in the United States? Answer: United states already had aircraft manufacturer giants like Boeing and McDonnells but they have a different strategy as compared to Airbus. US companies are interested in manufacturing smaller, faster, long range planes that would fly just below the speed of sound. But Air bus has a totally different strategy as compared to US giants. One of the major reasons for its success was that it focused on building fuel-efficient craft at competitive prices. Secondly it the company is manufacturing double decker super jumbo jet, known as A380 which is capable of carrying 555 passengers. Having these two unique strategies Airbus provided a clean sweep chance for EU to enter in the United States market and penetrated the United State market and captured Boeing and McDonnells market share. Q. No 3. How will Airbus help the EU compete in Japan? Answer: Airbus commercial and industrial presence in Japan has grown considerably in recent years, underscored by key partnerships in support of the companys product line of modern jetliners including its 21st century flagship A380 along with an increased number of aircraft bookings by the markets airlines.

Reinforcing the expansion of Airbus Japanese customer base was Sky-mark Airlines contract for four double-deck A380s, signed in early 2011. Sky-mark is Japans third largest and fastest growing airline, and is to utilize the A380 on major international long-haul routes from Tokyo.

The milestone A380 programme also has forged even stronger partnerships between Airbus and the Japanese industry. It is estimated that A380 business will bring approximately US $4.6 billion to the Japanese industry in the coming years, reflecting Airbus confidence in Japanese skills, reliability, technological leadership and quality standards. Japanese industrial support also includes nine supplier companies for Airbus' best-selling single-aisle A320 Family. Q. 4. In what way did the Airbus consortium use a keiretsu to building the aircraft? Why do you think it opted for this approach? Answer KEIRETSU APPROACH: A keiretsu Approach is a set of companies with interlocking business relationships and shareholdings. It is a type of business group. The member companies own small portions of the shares in each other's companies, centered on a core bank; this system helps insulate each company from stock market fluctuations and takeover attempts, thus enabling long-term planning in innovative projects. In what way did the Airbus consortium use a keiretsu to building the aircraft? In 1970 a European consortium of Germany, France, Great Britain and Span created Airbus the building of the commercial air craft was the responsibility of Germany and Great Britain, Span was responsible for the construction of the air craft and France assuming the responsibility of assembling it. Why do you think it opted for this approach? In my opinion as Germany and Great Britain remained the hub of technology in EU so they were involved primarily in designing and building of the pilot models. Spain have good skilled workers and remained helpful in the construction and France occupies excellent assembling skills.