How plane giants descended into global “price war”

By Tim Hepher – From Australia to Indonesia, the United States to Norway – and most recently, Reuters has learned, Turkey – the marauding plane giants have spent months taking or defending market share, with world No.1 Airbus aiming deep inside Boeing’s territory and its rival publicly vowing to defend a traditional 50-50 split.

One thing is for sure: if there is a price war, nobody can agree who started it. Each accuses the other of dragging down prices but acknowledges being hurt in the process.

“Airbus and Boeing are a duopoly and can’t collude, but they can signal to each other. And Boeing is sending a clear signal to Airbus that ‘if you price down to get market share we are not getting to let it happen so we both get hurt’,” said Nick Cunningham, managing partner of London-based researchers Agency Partners. more>


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