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Commercial Aircraft Industry Summary BTypical Industry Competitive Strategy CPorter Competitive Model Analysis EImportance of Information Technology to the Industry BMarket and Financial Performance DSignificance of Information Systems EStrengths and Weaknesses of Boeing as a Company Boeing Corporation Analysis PaperThe objective of this paper is to analyze the commercial jet aircraftindustry and more specifically Boeing Corporation to better understandthe significance of the role of information systems At the present time theindustry is dominated by two global players Boeing and Airbus and theirrivalry is in many ways representative of two seeminglyincompatiblenot to say totally opposing market philosophies Boeingis the free market champion while Airbus represents the not so freeapproach of the European Unions organized and government subsidizedcompetition in the so called strategic markets The worldwide market for commercial jet aircraft is primarily dependenton long-term trends in airline passenger traffic And this trend can beexplained by factors such as economic growth in developed and emergingmarkets political stability profitability of the airline industry and theglobalization and consolidation of the industry Other important factorsare limitations in air transport infrastructure such as government andenvironmental regulations and air traffic control Finally productdevelopment strategy and overall competition between manufacturers also Figure 1 World Air Travel Revenue passenger miles in billions excluding the former Soviet Union airlines World air travel has been steadily increasing at an average annual rate of5 including in 1994 with the exception of the year 1991 due to thePersian Gulf conflict Despite the steady growth in traffic after 1991 mostairlines have cut back their new aircraft orders mainly due to theirdismal financial performance resulting in dramatic reductions in aircraftmanufacturers backlogs Air France for instance canceled 500 millionin orders from Boeing and Airbus in January 1995 The commercial jet aircraft market is dominated by three majormanufacturers Boeing Airbus Industrie and McDonnell Douglas Table 1illustrates the revenues and earnings of the three players Other
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