Type: Business
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Aircraft Business Essay Example

The Boeing Company Background

The Boeing Company is a multinational company specializing in aerospace and defense. This American multinational corporation was established in the year 1916 by William Boeing, from whom it derived its name (Toto, 2003). It was founded in Seattle, Washington and over the decades Boeing has been growing tremendously. In 1997, this corporation merged with McDonnell Douglas which contributed a lot to the transfer of Boeing headquarters in 2001 from Seattle to Chicago in Illinois (Gould, 2005).

The Boeing Company Structure

This company is made up of several business divisions. These divisions include:

  • Boeing Commercial Airplanes (BCA);
  • Engineering, Operations and Technology;
  • Boeing Defense, Space and Security (BDS);
  • Boeing Shared Services Group;
  • Boeing Capital.

In general, Boeing is one of the largest aircraft builders in the world when in terms of revenue and number three in size amongst aerospace defense contractors. They have employed about one hundred and sixty four thousand, five hundred and forty five people in different parts of the United States.

The Boeing Company Achievements

Among the Boeing’s major achievements is the series of 787 commercial airplanes. They have built so many of those planes, which are used to carry passengers all over the world. Among the companies, most current innovations include the 787 Dreamliner which has received so much praise for its low fuel consumption. The company has also built general purpose Maritime aircrafts for the US Navy used as anti-submarine warfare Patrol aircrafts.

In August 2006, Boeing formed a joint venture with a very large producer of titanium in Russia to machine the titanium forgings. Among the company’s beneficiaries of that venture include the 787 program, which will require the titanium forgings. Boeing is actually looking into making major investments in Russia over the next three decades.

Boeing also launched ‘the Connexion by Boeing’ as a response to the customer need for the computer and internet access while travelling. An internet connectivity services based on a Boeing’s satellite has transformed both luxury and business air travelling due to the access of the World Wide Web. However, the service has been currently replaced by cheaper cellular networks. As a result, Boeing initiated an acquisition of Argon ST Inc. in order create synergies in command, communication, control, computers, surveillance and intelligence as well as the combat systems. This subsidiary has put Boeing in the cyber and intelligence markets adding to their non-aviation related services (Ratner & Siems, 2006).

The Boeing Company is currently working on new products and contracts like building of tankers for the US Air Force. They have put in a lot research aimed at lowering the cost of planes as well as making them environmentally friendly. Some of the innovations still under research include the Fozzie layout which will offer slower flying, the ‘Beaker’ design of wings which are thin and long but with the ability of partial folding for easier taxiing, the ‘Kermit Kruiser’ with wings that are forward swept carrying the engines to lower the noise below and the ‘Honeydew’ design of delta wings. Boeing has also welcomed the bio-fuel technology and electric propulsion and is currently working in conjunction with other companies to see that greenhouse gas emissions are reduced. The electric propulsion has also shown a lot of hopes in reducing noise and take-off distance. This company’s innovation has helped meet and surpass customer expectation in the aviation industry.

The Boeing Company Mission Statement and Values

The Boeing Company has a very elaborate mission statement focusing on their different values. To begin with, Boeing intends to be a world leader in all the aspects of business by creating team leadership qualities in all their management levels. They also want to promote integrity by practicing high standards of ethics. This makes them be ready and willing to take full responsibility for any actions that they take. Improving quality in all their products has also been a major objective to help them rank among the best companies not only in quality products but also in customer and employee satisfaction. It is also among their missions to enhance shareholder value through generation of profits and returns on the company’s assets.

Boeing’s competition and market share can be categorized into two, the airline business and the defense business. The company has reduced competition in the airline business by acquiring all the major aircraft manufacturers in the United States. However, they face steep competition from a European aircraft manufacturer, Airbus whose headquarters are based in France. The two companies share the market of large commercial aircrafts almost equally between each other. In the defense contracting business, Boeing competes with numerous other companies like:

  1. Lockheed Martin Corporation.
  2. Northrop Grumman Corporation.
  3. Raytheon Company.
  4. General Dynamics Corporation.

They have however managed to be ranked the second after Lockheed Martin with a market share of 29%. This success can be attributed to the adoption of strategies like opening of frontiers, creation of stronger and quality products, promotion of a healthy business and putting employees together for the achievement of one goal. The company has always observed and met the airworthiness requirements of building or modifying aircraft.

The aviation industry requires a huge amount of capital to join. This has protected the existing companies to some extend but they still suffer the threat of potential entrants. Boeing Company merges with such American companies to strengthen itself. However, international competition gives customers a very high bargaining power which has forced the company to embark on a cost reduction research to be able to produce planes at a lower cost. The aircraft manufacturing materials also seem to be supplied by relatively few organizations. This gives them the power to bargain for higher prices increasing the cost of production. Boeing’s move to join the Russian titanium company will ensure better deals in the acquisition of some of the crucial aircraft building materials.

The Boeing Company – the Largest Aircraft Manufacture

Boeing being the largest aircraft manufacturer all over the world has been able to sell planes to almost all the world’s commercial airlines. They have established a strong and loyal customer base in the entire globe. This company seems to have more strengths than weaknesses and more opportunities than threats. Among the company’s strengths is the already established global market. They have also diversified in the defense contracting business where they are really doing well. This company also benefits from a very skilled and talented workforce which values teamwork. The organization’s size has enabled it to offer competitive prices in the market attracting even airlines from developing countries.

Among the company’s weaknesses include strict organizational policies, which do not receive a good support from the employees hence reducing employee satisfaction and productivity. This results in overall low employee productivity. Boeing specializes in large aircrafts whose cost of building is very high and a burden to the company. The company also relies on component manufacturers and suppliers for necessary materials putting itself at a risk of failure in case of the suppliers’ failure. The only major threats facing the company are competition from the French Airbus and over reliance on the United States government contracts. They however have plenty of opportunities to exploit including the rising demand for commercial airplanes and growing expenditure on defense in the United States. The organization should also invest in a strong order backlog and advancement of aircraft building technology.

Boeing has been doing very well financially which is why their stock attracts a very high demand. Their revenues in 2011 grew from $64,306 million in 2010 to $68,735 million in 2011. Their earnings from operations and net income also grew by almost a billion each with the net income reaching the $4 billion mark. This success has been achieved amidst increasing costs of labor and fuel making the organization one of the most stable and far from the threat of bankruptcy. Their 2012 projected performance is even better than 2011 and the most recent news on the first quarter performance reaffirm that the organization is in the right track.

The Boeing Company President in an interview claimed that during 2012 they intent to focus on renewing their momentum and business strategies. Achievement of a record backlog coupled with a higher focus on productivity is hoped to even make the organization surpass its projections. The president said that they are sure of growth and a higher competitiveness in the market even in an unpredictable nature of their major client, the government of United States. Their aggressiveness in pursuit of growth has so far yielded positive fruits especially in the commercial plane manufacturing and defense, space and security division.


Boeing Defense, Space and Security division has also been experiencing an upward trend in the financial reports. For example, their revenues increased in 2011 from $14,238 million in 2010 to $14,947 million in 2011. The division’s margin also rose from 9.0% to 9.9%. This kind of performance is among the best in the industry and the company’s management prospects continued growth. Some of the other divisions have shown tremendous growth with some showing a decrease in performance. However, due to the success of the company’s major activities, the minor businesses do not face any threat of failure.

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