Supply Chain Challenges in Commercial Aircraft Manufacturing

Author Arthur Kraft
Co-Author John Kraft
DOI https://ww

Country : USA
Subject : Business and Economics

Keywords : outsourcing, supply chain, manufacturing, duopoly

Abstract

Supply chain problems not only arose from the vast distances among suppliers located in different countries, but issues of communication developed that made it difficult to coordinate the activities of all these diverse manufacturers. Natural disasters, shipping problems and geopolitical tensions contributed to delays. Rising trade barriers disrupted the supply chains as components moved back and forth among suppliers and eventually to final assembly. Further complications arose when suppliers were not capable of meeting the specifications for the components and the timelines assigned to them.

Supply chain disruptions challenged manufacturers’ ability to deliver planes on time. Aircraft manufacturers struggled to find engines and other components. Delays in aircraft deliveries left airlines without planes, so they continued to fly older less efficient planes.

In addition to the supply chain disruptions, the aircraft manufacturers contributed to their own problems. Fuel leaks, smoke in the cabin, fires and crashes plagued manufacturers and led to aircraft groundings with concerns over performance, reliability and safety. Airlines suffered groundings and delayed deliveries. Groundings continued until it was determined what caused these problems. This led to supply problems for the airlines since planes were not arriving and existing models of those planes were grounded. Airlines continued flying older jets that were not as fuel efficient and cost more to operate. Aircraft manufacturers incurred financial penalties tied to the delays. In addition, manufacturers covered the costs associated with fixing the problems once the planes were certified to return to service subject to fixing the problems.

The tariffs and other trade barriers imposed by the U.S, on imports during the 2025 trade war caused more disruptions to Boeing’s supply chain than to Airbus. Tariffs, reciprocal tariffs, retaliatory tariffs, and trade barriers impacted Boeing’s sales in the global market. Even though Boeing planned to navigate the trade war through a variety of measures, the future offered many challenges for Boeing.

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