Aircraft manufacturer, Boeing, challenged its rival Airbus at the Paris Airshow with its new 737 MAX 10, a larger version of its 737. Easily beating out Airbus in terms of sales on its first day at the event, Boeing is focused on cost efficiency. This is at a time where budget airlines are becoming so prominent in the industry.
It is stated the single-aisle aircraft market will be worth $6 billion over the next 20 years with 40,000 planes needed to cover increased air travel demands and replacements of aircrafts. However, even though Boeing is getting their jets to customers faster, Airbus' orders for its rival aircraft are toppling Boeing by over 3 to 1.
- What do you think the impact will be on each company's stock over the next few days?
- Will one company come out on top? Does Boeing's focus on low cost give it a competitive advantage or could it potentially hurt them?
Boeing is also a defense tech manufacturer and has ties to various govt's around world. i dont know about planes, but Boeing take the cake.
Very true, it was actually just announced that Boeing is majorly surpassing Airbus in terms of orders as of today.
Boeing is Losing the Fight Against Airbus (Originally Posted: 10/01/2017)
In terms of commercial airplanes, there are two main players and two main categories. Airbus controls 60% of the narrow-body (single isle) market, and now its going after the - traditionally dominated by Boeing - wide body (twin isle) market too:
United Airlines' recent https://www.bloomberg.com/news/articles/2017-09-06/airbus-is-said-close…</a">expansion of its earlier order for Airbus' wide body A350 airplane, to replace their aging Boeing 777 fleet, is indicative of Boeing's looming demise. Boeing's second largest revenue generator has been the 777, but the next generation, the 777x, designed to compete with the A350, is not very promising, since it still has not found any North American customers. Boeing is in a very precarious position, in that it needs sales to make up for all the debt they have been accruing developing the 787, 777x, and the debt they will accrue, if they decide to develop their middle of market (MOM) aircraft. They are making the MOM to accommodate the slight trend towards smaller narrow body airplanes.
Adding salt to injury, China and Russia have completed a joint venture agreement to build their own wide body aircraft. The state plane makers Commercial Aircraft Corp of China LTD and Russia's United Aircraft Corp, https://www.reuters.com/article/us-china-comac-russia/china-russia-set-…</a">said their planes would be 10-15% cheaper to run than Boeing, or Airbus planes.
All in all, Boeing's strong point, namely their wide body market share is under attack in many ways. Airbus is grabbing wide body market share, in that carriers are replacing aging 777 fleets with A350s. Wide body aircrafts seem to be growing out of favor, and China and Russia are trying to dominate this narrowing
Do you guys agree that its time to sell Boeing holdings? Are they doomed, or do you think their MOM concept is promising? How do you feel towards the airplane industry?
Sunt modi nemo neque ea a perspiciatis provident. Nulla voluptatem iure autem quidem cumque fugit. Quod doloremque ut quae necessitatibus consequatur magni exercitationem.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...