ksupilot
Posts: 635
Joined: Wed Jul 26, 2006 9:27 am

What If LM Produced Commercial Aircraft

Mon Sep 18, 2006 12:27 pm

I believe there was some talk on here about Lockheed possibly working on a possible super-sonic business jet, and I got to thinking what would happen if LM started producing commercial aircraft again.
Is it even possible for them to make a come back? Or do Airbus and Boeing have such control over the market that it would be impossible for a third party to enter the ring?
What about Lockheed trying to enter the RJ market and either go it along or teaming up with Bombardier to attempt to unseat the E-Jets.
These are all crazy, one-in-a-million scenarios, but are they out of the question? It seems to me that it is feasible for LM to make a comeback. Many say LM can accomplish anything they put their mind to. And they already a doing a good job beating Boeing in terms of military aircraft, the EELVs, and they just won a big contract for the Orion CEV. Why not take up the battle in the commercial aircraft market?
 
lincoln
Posts: 3133
Joined: Mon Nov 01, 2004 11:22 pm

RE: What If LM Produced Commercial Aircraft

Mon Sep 18, 2006 12:58 pm

Quoting KSUpilot (Thread starter):
Many say LM can accomplish anything they put their mind to. And they already a doing a good job beating Boeing in terms of military aircraft, the EELVs, and they just won a big contract for the Orion CEV.

Although I haven't done much work with the feds, based on what I've seen on both sides of the fence with state/local government agencies... If you can make a profit (and sustain your business) dealing exclusively with the a government agency...It may not be worth the extra hassle/incremental revenue of dealing with private industry.

From what I understand LM (I am making the assumption you mean Locheed Martin) does a very good job of catering to many of the federal government's needs...including ones that you may not associate with LM. They seem to be quite sucessful at it.

Absent a hole that they could clearly and easily fill, why deal with the private sector? With the government you have one entity with uniform policies/procedures (cough. yeah, right. cough.) buying large quantites and that will never run out of money in the business sense.

In the private sector, you're doing battle with other more established competitors for a finite market share. You have to be sensitive to price, and you have to woo multiple buyers (airlines), and perhaps deal with the pissing between them ("We want delivery slots now", "Why is XYZ Airlines paying less...?"). Among other things there are higher costs of selling each item (because instead of one person buying 500 of something, you have 10 airlines buying 50 of someting...each with individual contracts, policies, sales teams/meetings...and policies.). Oh, and airlines-like most publically traded companies--tend to be much more cost-sensitive than the government.

If I were in LM's position, I don't think I would want to screw up a good thing by diverting resources to a market that's already well served-and more competitive.

But that's just my $0.02333- and I have no formal business education.

Lincoln
CO Is My Airline of Choice || Baggage Claim is an airline's last chance to disappoint a customer || Next flts in profile
 
ksupilot
Posts: 635
Joined: Wed Jul 26, 2006 9:27 am

RE: What If LM Produced Commercial Aircraft

Tue Sep 19, 2006 4:41 am

That makes sense, the commercial market is just more trouble than it is worth.
 
SkepticAll
Posts: 58
Joined: Wed Aug 02, 2006 10:21 pm

RE: What If LM Produced Commercial Aircraft

Tue Sep 19, 2006 5:02 am

Build a better mousetrap and the world will beat a path to your door! While that holds true in most areas of the consumer market, in the aviation business, with the technologies as they exist today, there are only so many ways you can build an airplane. Airbus and Boeing have been battling for the last 15 years on ways of cornering a specific market and have truly yet to "out-do" each other. Both have the luxury of huge cash reserves and govern.........uh, forget that...........for the purposes of research and development. Lockheed-Martin, while flush with cash from it's defense contracts, has decided to spend those dollars on what it perceives to be its money maker, military aircraft and other weapon systems.

Good to see the lessons of Eisenhower's Military-Industrial complex still being practiced 45 year later!

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