The case “ Boeing 7E7” highlights confrontation between two major airline industries – Boeing and Airbus, whereas special attention is paid to Dreamliner project of Boeing as it is a new challenge to the airline services.
The case provides background of Boeing development, SWOT analysis, industry position, financial stability and prospects on future. Till 2002 Boeing has been market leader with $16. 6 billion defense contract, but since the September 11th terrorist attacks the situation has been changed and Boeing has been experiencing decreasing in revenues. Of course, the whole airline industry has suffered from attacks and Boeing started to think of new strategies and projects to ensure airline safety. The Dreamliner is a new super fuel-efficient jet called 7E7 that is able to carry over 200 passengers and is suitable for both domestic ad international hauls.
The key benefit is that Boeing 7E7 uses 20% less fuel in contrast to other planes of the same size. Moreover, the Dreamliner is supposed to be the first commercial plane built with carbon-reinforced material. In such a way the company is planning to reduce manufacturing and operating costs. The key strength of the Dreamliner is that is will be the most efficient jet with lower cabin altitude and increased cabin humidity.
Nevertheless, the key weakness is that developing cost will amount $10 billion and it will be rather difficult to build from engineering perspective. Further, Boeing should take the possibility of duplication into account as Airbus wouldn’t be willing to loose its positions. As far as plane’s efficiency will be ensured by new design of engine, Airbus may order more efficient engines. The current case concludes that Boeing needs innovative design and the Dreamliner would allow all types of services and routes. Moreover, the company would be provided with excellent opportunity to demonstrate that Boeing is still a leader in aviation design industry. Certain adjustments to the project should be considered.