Consumer behavior that has been influencing the defense and aerospace industry have been effected by today’s economy. The main contributors that are influencing the aerospace and defense industry have been the recession (budget crisis) and the recent statement by President Barack Obama stating the deployment of all military forces from Iraq by the end of 2011. These two trends, mainly, have been hitting the industry with different outcomes.
The recession has caused more consumers to stop traveling as much from before because the economy has been declining. Major suppliers such as the Boeing Company and Airbus have been the big suppliers for the aerospace industry in producing engines, jet parts, aircrafts, and other products to provide for the economy. Although profits being made by Boeing have been declining because of the lack of consumers wanting to travel, new projects are still being produced and are in high demand. The Boeing Company’s increase in production of the newest 737 Dreamliner model has been in high demand because of the improved fuel eficency. The fuel efficiency feature has been a trend in attracting many consumers because consumers are in a recession and fuel efficiency is cheaper and therefore more affordable.
As for the defense industry, after a long 10 years of the war in Iraq and Afghanistan, sales for military weapons and aircrafts will soon start to drop. For example, the department of defense is the provider that deals with contracts for military use. Lockheed Martin and BAE Systems are companies that majorly deal with making contracts with the government and getting funds to release those contracts worth millions of dollars. Because of the closing to the war in the Middle East, contractors and big companies like BAE Systems will be declining in business. Not only will employers for contracting will start to be out of jobs, but also soldiers. In my opinion, consumer behaviors are based on what is happening mainly on global affairs (i.e. a war, etc) and the outcomes that it can take a toll on this industry.
These consumer trends have been relied on the economy and whats happening in global affairs. Its hard to predict what will happen in consumer trends depending on whats going on around the world and how the economy is doing in terms of recession.
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