Bombardier Cseries
Bombardier CSeries Analysis by Elie Khalil Yachoui
1. Identification of the main Problem/Issue
Subsequent to Bombardier’s (BBD) successful restructuring from a snowmobile manufacturer in 1942, Bombardier Aerospace and Bombardier Transport maintained their titles as world leaders in their respective industries up until 1999. However, regular change in leadership since then had placed the company on the verge of an obscure vision and strategy. Coupled with BBD’s aging technology, drastic worldwide events, and rising attractive opportunities in the regional jets market, BBD has been subject to fierce worldwide competition and most aggressively from Brazil (Embraer). How can Bombardier gain back leadership in the globally competitive passenger aerospace industry?
2. Analysis
2.1 External Environment Analysis
Politically and legally, governments had always supported aeronautics by shielding national manufacturers against competition and subsidizing their research and development projects. To some extent, foreign competition called for the intervention of the World Trade Organization to control anti-dumping policies. Governments also got involved in establishing environmental regulations to control the damaging effects of air transportation on the environment. The deregulation of the aerospace industry in the mid-1990s led to a socio-cultural change in consumer's preference from high comfort level to lower prices. The latter pushed airline companies to seek low-cost-carriers to reduce costs. Economically, airline carriers adopted flexible financial models with manufacturers to meet fluctuating aircrafts demand and develop the business further. Technologically, airline manufacturers focused on innovating their core competencies through R&D and achieved economies of scale by outsourcing airplane segments to suppliers and developing strategic partnerships with subcontractors.
*REFER TO TABLE 1 IN APPENDIX FOR PORTER’S 5 FORCES TABLE* As the table shows,
1. Identification of the main Problem/Issue
Subsequent to Bombardier’s (BBD) successful restructuring from a snowmobile manufacturer in 1942, Bombardier Aerospace and Bombardier Transport maintained their titles as world leaders in their respective industries up until 1999. However, regular change in leadership since then had placed the company on the verge of an obscure vision and strategy. Coupled with BBD’s aging technology, drastic worldwide events, and rising attractive opportunities in the regional jets market, BBD has been subject to fierce worldwide competition and most aggressively from Brazil (Embraer). How can Bombardier gain back leadership in the globally competitive passenger aerospace industry?
2. Analysis
2.1 External Environment Analysis
Politically and legally, governments had always supported aeronautics by shielding national manufacturers against competition and subsidizing their research and development projects. To some extent, foreign competition called for the intervention of the World Trade Organization to control anti-dumping policies. Governments also got involved in establishing environmental regulations to control the damaging effects of air transportation on the environment. The deregulation of the aerospace industry in the mid-1990s led to a socio-cultural change in consumer's preference from high comfort level to lower prices. The latter pushed airline companies to seek low-cost-carriers to reduce costs. Economically, airline carriers adopted flexible financial models with manufacturers to meet fluctuating aircrafts demand and develop the business further. Technologically, airline manufacturers focused on innovating their core competencies through R&D and achieved economies of scale by outsourcing airplane segments to suppliers and developing strategic partnerships with subcontractors.
*REFER TO TABLE 1 IN APPENDIX FOR PORTER’S 5 FORCES TABLE* As the table shows,