Why is British Airways one of the biggest suppliers of the aircraft?
The British Airways (BA) has a big rivalry on different stages, comprising rivalries with indigenous rivals along with international airlines. However, the rivalry is strong on the international stage on different terms together with price, simplicity & the services that they offer so, British Airways actually need to maintain its quality to be able to continue in the industry and sustain its market importance. The main competitor of British Airways in the market is Virgin Atlantic as they both offer almost the same quality of service, but Virgin has relatively higher price than British Airways. RYANAIR, which is another player in the market but in a different segment is very low-cost flights. They offer less customer service which is expected for how cheap some flights can be as lowest as £20 which is half of British Airways to match. Therefore, Competitive Rivalry is Medium for British Airways.
There are very few suppliers of aircraft in the world namely Boeing, which is a US based company and Europe based Airbus, as it is a very difficult task to produce that and includes an enormous amount of investments. Thus, when the number of suppliers of aircraft is less, the suppliers have huge power, particularly in this example the British Airways, as well as the others, cannot function without the supply of aircraft. Thus, British Airways must develop good long-term relationships with its supplier. Same is the case with other supplies; British Airways cannot survive without fuel or crew and maintain a good relationship with these suppliers as well. Thus, the bargaining power of suppliers is high in the case of British Airways.