Airline

A corporate strategy article by Thunderbird students  Amanda Bhatia, David Freeman, David Wilson, Geoffrey Christanday, Jennifer Mousseau and Matthew Larson

As China’s economy develops, so do the prospective opportunities for foreign firms eager to sell their goods and services to these new Chinese customers.  However, many multinational corporations have already tried and failed – and yet – what makes these MNC’s keep coming back?

On March 6, 2012, Boeing and COMAC (Commercial Aircraft Corp. of China) announced[i] to the world that they will be joining forces for the first time ever, in creating a “collaboration agreement to partner in areas that will enable commercial aviation industry growth in China and potentially around the world”.  This partnership sounds well intentioned, but could make Boeing, and even Airbus (their current main competitor) nervous as to their future prospects in China and the future global market.  Will Boeing's partnership with COMAC provide Boeing with an opportunity to meet strong aircraft demand forecasts in China in coming years, or instead mean the creation of their own competitor?

A corporate strategy article by Thunderbird students Amina Ahmed, Marquita Blanding, Benjamin Donner, Julia Glad and Carla Vila

Introduction

Positioned as a budget airline company with a tourism focus, JetBlue is synonymous with the keywords "quality" and "customer satisfaction." JetBlue offered many firsts in the airline industry, including: satellite TV, satellite access to e-mails, vacation packages on eBay, and a "customer bill of rights" — that enables customers to be compensated for their inconveniences. Today, JetBlue has expanded its operations to include partnerships with international airlines, with a fleet of more than 400 airplanes. Despite the fierce competition of the airline industry, JetBlue continues to rise in popularity and revenues. How does JetBlue manage to continue its growth, especially while competing with rival discount airline Southwest?

Fierce Competition – Jet Blue and the airline Industry

The airline industry has changed dramatically since the early 2000s, due, in part, to the volatile global economy. Many airlines, more so in the U.S., have had to alter their competitive plans in order to keep up with the changing dynamics of the industry. In order to stay afloat, many full-service airlines looked to cost-cutting options, while airlines like Jet Blue and Southwest focused on delivering services differently than their competitors. At the time, these services were either standard or unique to the industry. Ultimately, full-service airlines found it much harder to compete with low-cost, convenient service airlines. Some of those airlines either went out of business, or completely re-engineered their business plan, or merged with other airlines to be competitive. Some of the most noteworthy mergers and acquisitions are United and Continental, US Airways and American West, American Airlines and TWA, and Southwest and AirTran.

By Kishore Chagamreddy, Peter Addy, Ian Jensen, Darrell Member, Bindu Malik, Misty Caruth and Maggie Gu

"Aerospace is a leading global supplier of aircraft engines, avionics, and related products and services for aircraft manufacturers, airlines, aircraft operators, military services, and defense and space contractors" (Honeywell 2009 Annual Report). This statement by Honeywell sounds like the same mumbo jumbo that customers and investors read from a company. All for-profit organizations strategize in some way to be the leader in their industry. What is Honeywell’s recipe?

A favorable attribute of the aerospace industry that benefits Honeywell is the high barriers to entry into the market. This area is a recognizable strength for Honeywell and the company uses it to maintain profitability.

Initiatives this past year have shown that Honeywell is winning in the marketplace. Their pursuits into a customer focused portfolio have created over $100B in OEM wins. Their selection by Commercial Aircraft Corporation of China, Ltd (COMAC), a huge win to be the fly-by-wire flight control provider for the new C919 single-aisle commercial, is an additional $11B for the company. They’ve managed to obtain over 90% of the airline aftermarket selections. And these are just the story board wins for Honeywell.

By Dawn Swearingin, Rohan Verma, Jameson Neuhoff, Travis Wattles, Priyanka Jain and Wei Zheng

One of the few positive outcomes of the current financial crisis is the emergence of taxpayers as informed stakeholders in the activities of government. The U.S government, mindful of this development, is conceivably more cautious when allocating funds to its different departments. One exception is the Department of Defense, which has consistently seen on average a rise of 5 percent in its budget allocation throughout the last decade, whereas most other departments have faced major reductions.

This is partly understandable due to the geo-political scenarios in Iraq, Afghanistan and North Korea. As this is a matter of national security, it does provide a plausible explanation of why it has not attracted the wrath of taxpayers and media activists yet. But, have you ever wondered whether this increased allocation is justified on the basis of national security alone, or are there glaring inefficiencies in the Department of Defense that drive up project costs and timelines?