Small Business Management

In: Business and Management

Submitted By ChelseyLocks
Words 3083
Pages 13
Aircraft Manufacturing Industry
Outsourcing in a Global Market
Aircraft Manufacturing Industry
Outsourcing in a Global Market

Table of Contents Table of Contents 1 Abstract 2 Introduction 3 Growth of Outsourcing 5 Benefits of Outsourcing 6 Disadvantages of Outsourcing 8 The Global Market and Aircraft Manufacturing 9 Conclusion 12 Bibliography 13

The aircraft manufacturing industry is dominated by a few key players: Bombardier, Boeing, and Airbus being the most prominent. It is in a constant struggle to deliver ever more intricate machinery that are safe and reliable - while maintaining a competitive cost structure. With countries such as China and India becoming more commercialized, air travel will continue to grow at a consistent rate; however, steady growth is not without its challenges: rising fuel prices and mounting material costs have forced aircraft manufacturers to look for other ways of maintaining a competitive structure. One way of maintaining a competitive cost structure is through outsourcing of non-fundamental core jobs. This practice has become so prominent with some of the world’s major aircraft manufacturers that the parts used to build planes today come from all over the world.
The airline industry is a fairly resilient industry, even with slow economic times the need for people to travel for business and pleasure is still present. Outsourcing of non-core jobs may be the answer for cost efficiencies but can have serious economic, political and societal consequences that must to be taken into consideration by all businesses in the aircraft manufacturing industry.

Aircraft manufacturing is a competitive industry; by definition, this industry is an oligopoly. In this competitive structure sellers have significant influence over the buyer and therefore must respond to the demands of other selling…...

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