2. Bargaining Power of Suppliers
Power of suppliers is limited, due to the fact there is a wide variety of spare parts producers. Those suppliers, which offer key technologies, can have an effect on prices and conditions though.
3. Bargaining Power of Buyers
Bargaining power of buyers is high as their numbers are limited, they can easily swap the engines within their airplanes. Their demand and product specification are determining for the manufacturers.
Buyers are in favorable positions in the price negotiations before having big deals signed.
4. Threat of Substitute Products/Services
The aircraft manufacturers have threats of substitute products only if any companies can offer advanced materials or technologies within the manufacturing …show more content…
V.2. Future of the industry
In the next two decades the commercial aerospace industry is likely to drop to an industry shaped only by a few large companies. A commercial airplane consists of approximately six million parts and the technical descriptions should contain million pages. The number and specifications of products, services and technical data are endless. This technological complexity, the extended pay-back period of investment and the high expenses of research and developments formalize a big entry barrier. We may state that no similar industry exists where the size would not be so determining.
One of the key tendencies that are expected to happen within the industry is the entrance of the operation activities among the airlines and its suppliers at the e-marketplace for purchases of products and orders of services. There are several advantages of an e-marketplace. It can bring efficiencies into the ordering and purchasing operations to reduce costs and also create higher value. It can enable the market actors to exchange the knowledge more easily, identify and utilize innovative
Power of suppliers is limited, due to the fact there is a wide variety of spare parts producers. Those suppliers, which offer key technologies, can have an effect on prices and conditions though.
3. Bargaining Power of Buyers
Bargaining power of buyers is high as their numbers are limited, they can easily swap the engines within their airplanes. Their demand and product specification are determining for the manufacturers.
Buyers are in favorable positions in the price negotiations before having big deals signed.
4. Threat of Substitute Products/Services
The aircraft manufacturers have threats of substitute products only if any companies can offer advanced materials or technologies within the manufacturing …show more content…
V.2. Future of the industry
In the next two decades the commercial aerospace industry is likely to drop to an industry shaped only by a few large companies. A commercial airplane consists of approximately six million parts and the technical descriptions should contain million pages. The number and specifications of products, services and technical data are endless. This technological complexity, the extended pay-back period of investment and the high expenses of research and developments formalize a big entry barrier. We may state that no similar industry exists where the size would not be so determining.
One of the key tendencies that are expected to happen within the industry is the entrance of the operation activities among the airlines and its suppliers at the e-marketplace for purchases of products and orders of services. There are several advantages of an e-marketplace. It can bring efficiencies into the ordering and purchasing operations to reduce costs and also create higher value. It can enable the market actors to exchange the knowledge more easily, identify and utilize innovative