Legal
As mentioned above, companies in this field have a high responsibility concerning the safety of their products. Furthermore, companies often are highly regulated by supranational instituts (NATO, EU) when exporting military products to unstable countries. Therefore, exporting might very often be a risky procedure.
3-Porter’s Diamonds
Porter’s Diamonds is a well-known instrument to analyse the competitiveness of a firm among industrialized nations. As following, we will apply the four basic parts of Porter’s theory and explain the competitiveness of Airbus.
Factor conditions:
Airbus aerospace business requires a strong knowledge-based resources due to high complex products. Due to a modern and distinctive education and university system, …show more content…
Due to very high fixed costs, high required know-how, elaborated manufacturing chains and a long-term cooperation with governments, new competitors have huge entrance barriers to overwhelm and buyers might have huge switching costs. As far as military products is concerned, a entry of new companies is rather low because of the above explained cooperation with governments. However, a entry threat for the aircraft market might be conceivable, especially if taken account entries from far distant countries like China.
Threat of substitutes
Also the threat for substitutes are low. Firstly, an aircraft can hardly be subsidized by another technology. Radical changes (i.e. electrical aircrafts) in this sector are either very far away or a result of long research & development efforts. For military application, substitutes are usually developed together with the company and the military. However, certain technologies have been subsidized in the past by other companies (i.e. recon drones subsidized recon helicopters). Also space applications are less likely to be subsidized on a great scale. Overall, the threat from this side is low as well.
First strategy concerning the supply chain issues
As mentioned above, companies in this field have a high responsibility concerning the safety of their products. Furthermore, companies often are highly regulated by supranational instituts (NATO, EU) when exporting military products to unstable countries. Therefore, exporting might very often be a risky procedure.
3-Porter’s Diamonds
Porter’s Diamonds is a well-known instrument to analyse the competitiveness of a firm among industrialized nations. As following, we will apply the four basic parts of Porter’s theory and explain the competitiveness of Airbus.
Factor conditions:
Airbus aerospace business requires a strong knowledge-based resources due to high complex products. Due to a modern and distinctive education and university system, …show more content…
Due to very high fixed costs, high required know-how, elaborated manufacturing chains and a long-term cooperation with governments, new competitors have huge entrance barriers to overwhelm and buyers might have huge switching costs. As far as military products is concerned, a entry of new companies is rather low because of the above explained cooperation with governments. However, a entry threat for the aircraft market might be conceivable, especially if taken account entries from far distant countries like China.
Threat of substitutes
Also the threat for substitutes are low. Firstly, an aircraft can hardly be subsidized by another technology. Radical changes (i.e. electrical aircrafts) in this sector are either very far away or a result of long research & development efforts. For military application, substitutes are usually developed together with the company and the military. However, certain technologies have been subsidized in the past by other companies (i.e. recon drones subsidized recon helicopters). Also space applications are less likely to be subsidized on a great scale. Overall, the threat from this side is low as well.
First strategy concerning the supply chain issues