The rivalry between Boeing and Airbus has been regarded as a duopoly in the airliner market for three decades. This is the result of a series of mergers within the international aerospace industry, with the American Boeing absorbed its former rival McDonnell Douglas in 22 years ago while the Airbus beginning as European Consortium. But is there a winner of the Boeing vs Airbus competition in 2018?
Other airline manufacturers such as Convair, Lockheed Martin in the US, Fokker in Europe, and British Aerospace were no longer capable of competing with the Airbus and Boeing. This is why these companies had to withdraw from the airline industry.
Sells and turnover: Boeing vs Airbus
In the last ten years from 2008-2018, Boeing has delivered 5,718 orders and received 8,978 orders, and the Airbus has delivered 5,644 orders and received 9,985. In the midst of their grave and intense competition, both companies regularly accuse each other of receiving unfair governmental aids.
During 2018, the aerospace industry generated more than half a trillion dollars in revenue with key markets in Europe, the United States, Canada, and Russia. Two of the largest defense and aerospace manufacturers in the world are Airbus and Boeing with revenues of 67 billion euros and 93.4 billion US dollars, respectively.
Boeing vs Airbus: Outsourcing
Since a number of airlines in the world are partially or wholly government owned, the airline procurement decisions are usually taken according to political and commercial criteria. Both Airbus and Boeing seek to take unfair advantage of this by subcontracting production of airplane assemblies or components to manufacturing firms in countries that are of their strategic significance in order to achieve an overall competitive advantage.
For instance, Boeing has established and maintained longstanding relationships with Japanese suppliers including Kawasaki Heavy Industries and Mitsubishi Heavy Industries by which these corporations have had cumulative involvement in various Boeing Jet programs. This has helped Boeing company to dominate the commercial jet market in Japan. On the other hand, as a European consortium, the Airbus has not availed many opportunities to outsource parts of its production beyond the European manufacturing plants.
What was the situation in 2018?
Boeing had a towering year of new commercial airplanes orders as the US-based airline manufacturer racked up orders for 196 airplanes, valued at $29 billion. In comparison, the Airbus booked orders for 8 aircrafts in March 2018, valued at about $900 million. In addition, in the first eleven months of 2018, Boeing received a large number of orders, with high value airplane accounted for 28% of its net orders than the 21% for Airbus. Last month, Green Africa Airways ordered fifty 737-Max airlines and Saudi Arabia’s “Fly-a-deal” ordered about thirty 737-Max aircrafts.
Airbus received orders for a total of forty-three airplanes in its single aisle A320 and wide-body A330 families in November 2018. The company also provided eighty-nine jetliners from across its A380, A350 XWB, A330, A320, and A220 product lines to various international customers.
Headlining the new trade in November 2018 was the agreement for seventeen additional A320-neo aircrafts with the low-cost carrier Easy-Jet headquartered in the UK. It is one of the largest airline operators of Airbus single aisle airplane in the world. Moreover, during the month, a Delhi-based airline service ‘Vistara’ ordered thirteen A320-neo Jetliners, which is another significant achievement for the company. Furthermore, the total number of orders and deliveries for Boeing in 2018 were 690 and 704 whereas the total number of orders received and delivered for Airbus in the same year were 380 and 673.
In conclusion to this Boeing vs Airbus comparison, we can assert that Boeing has a more developed product line (of which the new Boeing 777X is a good example), while Airbus has more potential for improvement. The explosive growth in air travel, especially in Asia, has led to a boom in sales of airliners.