Boeing and Airbus Vie for Chinese Market

Boeing and Airbus vie for Chinese Market

Competitive rivals are organization with similar products and services aimed at the same customer group (Johnson, Scholes, Whittington, 1998). Porter (1980) states that rivalry among existing competitors takes the familiar form of jockeying for position -using tactics like price competition ,advertising battles, product introductions and increased customer service or warranties.

It has almost 40 years since Boeing cooperate with Chinese aviation companies, which become the largest buyer of aircraft components made in China. Boeing has its valid contracts with China's aviation industry more than 2.5 billion U.S. dollars.

Boeing's newest energy -efficient plant in Tianjin - China was put into use on April 18, 2011, it indicates that the importance of Boeing's production partners in China, furthermore, promoting Boeing's relationship with Chinese aviation companies, so as to reach the win-win situation in civil manufacturing, services, aircraft sales, R&D domains.

Boeing Tianjin produces components, which including the 737, 747-8,767,777 and 787, the plant aim to provide world-class production, marketing capabilities and better support services to the Chinese aviation enterprises.

China has great potential on the aviation market that enhances the confidence of Airbus to cooperate with Chinese aviation industry; therefore they choose Tianjin as the location of A320 aircraft assembly plant, which is the first away from Europe.

The first aircraft is kicked off the production line in 2008, and four aircraft manufactured every month up to 2011. Experts said: 'venture marks an important step for China in manufacturing large aircraft and also indicates an adjustment in China's strategy for securing such business.' Currently, Airbus plans to produce single-aisle commercial airliners entirely in China, that is an important step to make a long term and sustainable commitment to the aviation filed.

China challenge to Boeing and Airbus

Competition between Airbus and Boeing are still in an intensive situation, many countries nowadays are getting more and more interested in developing domestic aircraft, and China is one of the examples. As Brazil aircraft manufacturing and several emerging companies are also rush to the small aircraft manufacturing markets, it is playing a cruel war in the aviation industry.

China plans to produce its own large commercial jet by 2020, it is no doubt that China has huge potential to compete with dominance of Boeing and Airbus in the world's fast-growing aircraft market. According to the statistic, China is in the middle of a five-year plan to purchase 500 jetliners, recruit 5000 pilots and build 48 airports, by the year 2025, it will spend several trillion dollars on the purchase of 2230 planes. (http://www.englishcn.com/zh/reading/newspaper/20070312/2775.html)

Due