Thesis (S.M. in Engineering and Management)--Massachusetts Institute of Technology, Engineering Systems Division, System Design and Management Program, 2011. / Page 88 blank. Cataloged from PDF version of thesis. / Includes bibliographical references (p. 82-87). / Using an industry analysis framework, this thesis analyzes whether the recently established Commercial Aircraft Corporation of China (Comac) is likely to break the Boeing-Airbus duopoly in the industry of large commercial airplanes. The selected framework for this thesis is comprised by the following two principles: 1) "The nature and degree of competition in an industry hinge on five forces, one of these being the Threat of New Entrants, which depends on the height of Entry Barriers." (Porter 1979, 1) 2) "In order to cope with the competitive forces in an industry, there are three potentially successful generic strategic approaches to outperforming other firms in the industry: overall cost leadership, differentiation, and focus." (Porter 1980, 35) The results from the barriers of entry analysis suggest that Comac enjoys full unconditional support from the Chinese government as the development of an aerospace industry is deemed as national interest. However, the firm faces a high barrier of entry derived from the advantages the incumbent companies have in terms of their learning and experience curves, which allow them to effectively conduct research and development and innovate. In the long run, as the companies seek sustained competitive advantage (Porter 1984, 34), I find that Comac will mainly rely on generic strategy 'cost', while the incumbents counteract by adopting mainly generic strategy 'differentiation' and 'focus'. This thesis claims the chances of success for Comac largely depend not only on finding the right strategy for a proper balance between 'cost' and 'differentiation', but mainly on the Chinese government being able to maintain protectionist policies in place. In other words, the Chinese government must continue to decide for the domestic airlines what airplanes they should buy. This conclusion is reached by analyzing the history of all previous attempts by China to develop a national jet-which have all been unsuccessful- and the recent history of high-tech industries where China represented the world's largest market and there was a national interest for technology transfer. / by Jose L. Fuentes. / S.M.in Engineering and Management
| Identifer | oai:union.ndltd.org:MIT/oai:dspace.mit.edu:1721.1/70829 |
| Date | January 2011 |
| Creators | Fuentes, Jose L., S.M. Massachusetts Institute of Technology |
| Contributors | James M. Utterback., Commercial Aircraft Corporation of China, Ltd., Massachusetts Institute of Technology. Engineering Systems Division |
| Publisher | Massachusetts Institute of Technology |
| Source Sets | M.I.T. Theses and Dissertation |
| Language | English |
| Detected Language | English |
| Type | Thesis |
| Format | 88 p., application/pdf |
| Coverage | a-cc--- |
| Rights | M.I.T. theses are protected by copyright. They may be viewed from this source for any purpose, but reproduction or distribution in any format is prohibited without written permission. See provided URL for inquiries about permission., http://dspace.mit.edu/handle/1721.1/7582 |
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