Driving forces of Aerospace and Defense industry Essay

Regulatory influences and government policy changes. The aerospace & defence mechanism industry remains a profitable yet challenging business. Global cuts in government spending, curiously in the United States, will put significant financial pressure on companies, forcing them to realign their strategies and shift their business models. The ongoing decrease of military operations in Iraq and Afghanistan coupled with reduced military budgets globally continue to affect revenues throughout the defense sector. The biggest challenge for defense contractors is growing profitably in a decreasing market. Increasing globalization and emerging new markets. According to a 2012 report from Chicago-based Boeing Co., commercial airmanship is experiencing a virtually unprecedented and prolonged up cycle, as demonstrated by recent increases in production by Boeing as well as French aircraft manufacturer Airbus SAS and Brazils Embraer SA. trey dominant forces are driving this up cycle increased p assenger travel, most notably in Asia an increase in budget airlines and the demand for more burn-efficient aircraft. The combination of the three factors has created a perfect ram for commercial aviation, transforming it into the driving force behind the aerospace industry, with between 27,350 and 34,000 commercial aircraft expected to be produced over the bordering 20 years (Current Market Outlook, 2012). Technological change and process innovation. The commercial aerospace incision remains profitable, with a strong demand for fuel-efficient next generation products. With fuel prices continuing to rise, the cost of fuel remains a significant financial concern to airlines.The use of fuel-efficient jet engines on commercial aircraft is the head start step in reducing fuel costs for many airlines, a less-expensive alternative to replacing accurate fleets. Airlines are choosing to update their current aircraft with newer fuel-efficient engines although longer-term it seems likel y that older planes will be replaced by newer aircraft that feature some(prenominal) fuel-efficient engines and airframes. Cooperation with both customers and suppliers remains a key driver of innovation. Product stewardship, life cycle management and operational eco-efficiency have become key requirements for both commercial and military applications. The call for alternative fuels and propulsion technologies is increasingly becoming a question of not only operating costs, but one of national protective cover and public policy.Current Market Outlook 2013-2032. (2012). Retrieved from http//www.boeing.com/boeing/commercial/cmo/