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Airbus vs. Boeing (a)

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REV: SEPTEMBER 18, 2007

ERICH ALEXANDER VOIGT JORDAN MITCHELL

Airbus vs. Boeing (A)

Should Airbus go ahead and develop its own version of a super jumbo (the A3XX)? Should Boeing develop a larger version of the 747? What would Boeing and Airbus gain by teaming up? What could they lose? The answers to these questions would determine the future of both companies for many years to come.

The Commercial Airline Industry

Do

The global aviation industry was sized at approximately $100 billion as of 1992. The single largest segment was the manufacture and sale of large commercial aircraft, which totaled $38.5 billion in 1991.1 The sale of large commercial aircraft was expected to grow to $40 billion by the end of 1992. The worldwide commercial aircraft fleet was made up of nearly 8,000 passenger and 1,200 cargo planes spread out over 450 airlines and operators. Large commercial aircraft were defined as airplanes with 100 or more seats. Large aircraft made up 90% of the fleet, while smaller airplanes accounted for the remaining 10%.2 The VLCT was defined as a plane over 400 seats or with the

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Professor Ramon Casadesus-Masanell, Erich Alexander Voigt (Tiggeman Associates), and Research Associate Jordan Mitchell prepared this case. This case was developed from published sources. HBS cases are developed solely as the basis for class discussion. Cases are not intended to serve as endorsements, sources of primary data, or illustrations of effective or ineffective management.

Copyright © 2006, 2007 President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1-800-5457685, write Harvard Business School Publishing, Boston, MA 02163, or go to http://www.hbsp.harvard.edu. No part of this...

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