Today's market for aircraft is one of contrast. Developed countries are seeing a decrease in traffic, but new markets are exploding. Customers seem to want more comfort, but are not willing to sacrifice speed and price for it. Airbus tends to treat these changes by designing large aircraft and tinkering with them to adapt them to the market, while Boeing invests in research and innovation hoping to recoup the costs through early replacement.
Boeing and Airbus are direct competitors in the large, medium-to-long range aircraft production. Boeing has dominated the industry for almost a century. Airbus has been catching up as initial investments in research and development made by the European Union pay off. Both are heavily affected by changes in environmental requirements, fuel prices, and the worldwide economic climate.
Airbus was formed through the conglomeration of several companies when the European Union was formed. To help solidify the designs and to jump-start the company, many of the governments gave research and development support to get them started.
The production of the airplanes is very centralized. The manufacturing facilities are often kept close to home to support the governments which helped the company to start up. This also greatly reduces the transportation costs associated with manufacturing, especially when compared to its top competitor, Boeing.
This is changing to some extent. Airbus has opened factories in China ("Opposite Headings) and may do so in the United States as well. These foreign plants, however, have as much to do with name recognition, foreign investment, and market development as they do with cost savings.
Airbus designs and produces its most parts of their airplanes themselves, rather than outsourcing them as Boeing does. There are some very strong benefits to doing so. Development and production time can be shortened through greater coordination. The company reaps ...