Boing 737 Assignment Example | Topics and Well Written Essays - 250 words

Boing 737 - Assignment Example However, in the early 1990s many commercial aircraft manufacturers including Douglas Aircraft, McDonnell Aircraft, and Boeing switched to horizontal integration through mergers. The major drivers to this shift were technology that progressively became more specialized, costs of production using vertical integration became uncompetitive and the dire need for management efficiency. On the other hand, factors such as lower costs due to increased economies of scale and increased market power made Airbus maintain vertical integration. Horizontal industry structure seems to be a benefit since it helped resuscitate Boeing that had stagnated after many years of vertical integration structure. It helped it install a lean system and clean up the production of the 737. The evolution of the auto industry is similar to that of the commercial aircraft industry. Major players in the industry have adopted the â€Å"lean production system†. However, competitive forces are far from being static, and hence vehicle manufacturers can no longer rely on excellence in production only (Shih and Pierson