Boeing Company SWOT Analysis Essay

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Boeing is an established company that has been working in the aviating industry for over 100 years. Table 1 presents the SWOT analysis of Boeing’s external environment and internal resources and capabilities. Firstly, it is necessary to review the external environment of Boeing, mainly the aviation industry, which is undergoing a crisis, presenting many threats for Boeing, especially considering the recent disruptions affecting air travel, supply chain, and manufacturing.

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Opportunities for Boeing are connected to the increased popularity of international travel and long-distance airplane journeys. Firstly, the aviation industry has demonstrated growth in recent years, with increased consumer spending on air travel, leading to an increased demand for Boeing’s products (Boeing, 2019). Moreover, travelers and air travel companies focused more attention on long-distance journeys and international travel.

The market has demonstrated a change in consumer preferences, which allows Boeing to introduce its products to new markets and explore different options for growth (Boeing, 2019). However, the coronavirus outbreak has affected the oil prices, which was the main threat for Boeing prior to the outbreak, providing a growth opportunity for the business after the restrictions are lifted (Ntshalintshali, 2019). Moreover, the government of the United States will offer relief packages for companies, including Boeing, which should help deal with the crisis.

The main threats for Boeing emerged recently with the rapid development of the Covid-19 pandemic and the ban on international travel from many states. According to Tangel and Gryta (2020), Boeing already suspended production of its aircraft in Seattle. Since it is unclear when it will be safe to resume work at factories, this event placed a severe strain on Boeing. Apart from safety, the supply chain of Boeing is disrupted, since many companies manufacturing parts and components for aircraft are not operating (Ryan, 2020). Moreover, the airline industry, in general, has suffered from a significant loss of operational activity, as international travel has been banned by many countries, including the United States (Ryan, 2020).

This inevitable will affect the demand for Boeing’s products in the following moths. Prior to the coronavirus outbreak, Boeing was threatened by the oil price volatility. Ntshalintshali (2010) states that OPEC controls over 40% of the oil industry and, subsequently, the prices on the market, and in recent years, the future purchase orders may decrease, providing opportunities to the competitors.

As for strengths, Boeing has focused on its research and development (R&D), spending a lot in this domain. This means that the company has an advantage before its competitors in regards to new products and improvements to the old ones. Additionally, Boeing has had a stable financial outlook since prior to 2020, Boeing (2019) reported a steady growth of operations. Thus, the company is investor-friendly and, in addition, has been dominating the aircraft manufacturing industry for many years.

The weaknesses include the spending of the business on R&D, which, although it brings a significant competitive advantage, also affects the revenue and profits negatively. The fact that the customers show more interest in Boeing’s product results in a substantial labor force strain. Moreover, Boeing’s aircraft have crashed in recent years, which affected the perception of the company and raised safety concerns.

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StrengthsWeaknesses
  • Focus on R&D
  • Stable financial outlook
  • Investor-friendly company
  • Steady growth forecast (Boeing, 2019)
  • R&D affects revenue
  • Increased demand results in labor strain
  • Recent aircraft crashes of Boeing’s airplanes
  • Safety and security concerns
OpportunitiesThreats
  • The industry has been growing
  • Increased focus on international travel and long-range travel
  • Governmental support
  • Oil price decrease due to coronavirus
  • Oil prices volatility
  • Supply chain disruption
  • Air travel ban
  • Possible reduction in demand due to coronavirus

Table 1. SWOT analysis of Boeing (created by the author).

References

Boeing. (2019). Current aircraft finance market outlook. Web.

Ntshalintshali, T. (2018). . Web.

Ryan, C. (2020). The coronavirus is squeezing aerospace beyond Boeing and Airbus. Bloomberg. Web.

Tangel, A. & Gryta, A. (2020). Coronavirus exacts mounting toll on industry. WSJ. Web.

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IvyPanda. 2022. "Boeing Company SWOT Analysis." February 13, 2022. https://ivypanda.com/essays/boeing-company-swot-analysis/.

1. IvyPanda. "Boeing Company SWOT Analysis." February 13, 2022. https://ivypanda.com/essays/boeing-company-swot-analysis/.


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