1. Discuss the nature of the market structure and demand for the Dreamliner.

What
are the implications of this for Boeing and its customers?

The market structure for the Dreamliner is that of an oligopolistic nature which
means there are few aircraft manufactures who sell large quantities to its buyers. With
Boeings biggest competitor Airbus unable to compete with the Dreamliner product,
Boeing has the chance to take over the market for commercial aircraft. The market for
aircraft is typically divided into two product categories: narrow-body and wide-body
aircraft. The Dreamliner is wide-body aircraft because Wide-body aircraft are double
aisle, medium- to long-range aircraft (up to 14,000 km) that can carry between 200 and
450 passengers.
The demand for the Dreamliner is derived demand. Due to customer demand for
comfortable fair priced airline travel, the demand for the Dreamliner will increase.
Customers demand comfort during air travel and the Boeing Airliner promises added
luxuries that will increase customer purchases to those airlines with a Dreamliner
aircraft. The 787 Dreamliner will carry 210 - 250 passengers on routes. In addition to
bringing big-jet ranges to mid-size airplanes, the 787 will provide airlines with
unmatched fuel efficiency, resulting in exceptional environmental performance. It will
also travel at speeds similar to today's fastest wide bodies, Mach 0.85. Airlines will
enjoy more cargo revenue capacity. Passengers will also see improvements with the
new airplane, from an interior environment with higher humidity to increased comfort
and convenience. Another improvement in efficiency will come in the way the airplane is
designed and built. New technologies and processes are in development to help Boeing
and its supplier partners achieve unprecedented levels of performance at every phase
of the program.