The Global Transportation Industry: Bombardier Essay -- Case Study

Political FactorsBeing a major player in the global transportation industry, governments are both partners and customers to Bombardier. The transportation industry is seen as a quintessential strategic industry due to its highly remunerative nature and contribution to a countrys economic growth and prosperity, attracting significant reward from their governments.The Government of Canada provides Bombardier with various subsidies much(prenominal) as tax breaks, financing, loan guarantees, and R&D support. The federal government, through EDC (Export Development Canada) administer these subsidies, even providing loans to internationalistic airlines enabling them to buy regional aircrafts from Bombardier . Such initiatives are necessary to forgo Bombardier to thrive in an industry dominated by state O.K. international rivals.However, the issue of unfair subsidizing to undercut completion has been subject to healthy cases and numerous allegations among the major rivals. The impact of this attention is being seen in the skeletal frame of more conservative subsidy measures. In the light of such scrutiny, this bowel movement is set to continue, forcing Bombardier to evolve into a more independent self preserve company.Economic FactorsAlong with the rest of the world, Bombardier has suffered the ill effects of the recession. However, there is an up(a) trend in the transportation industry led by ontogenesis demand and impressive economic growth forecasts in developing nations such as China and India. For the next 20 years, a return to carry on growth in barter aviation is predicted, with a estimated demand for 24,000 business jets in all segments in which Bombardier competes. This represents total revenues of approximately $626 billion for the industry. These fac... ...any that is suit sufficient to sell at a higher rate than cost has a greater chance of being more successful. Overall, Bombardier has been able manage a gross profit in the range of 15-16%. Given the nature of their operations being mostly on a contract basis, meaning that their reaping prices differ by customer, this shows that Bombardier is able to successfully sell their products at a consistently profitable manner. Additionally, it represents their ability to negotiate with customers. Of great notice is that they were able to maintain their margin levels throughout the recession of 2008-2009.SourcesWiedman, 2002 http//www.camagazine.com/archives/print-edition/2002/dec/regulars/camagazine25484.aspxStanford & Eprile, 1999 http//findarticles.com/p/articles/mi_hb6419/is_3_73/ai_n28735186/SEC press release, 2004 http//www.sec.gov/news/press/2004-144.htm