Abstract
This teaching case covers MTU Aero Engines, a German aerospace company. The focus is on alliances both vertical and horizontal to highlight a unique strategic position of the firm as a first tier systems supplier to the aircraft engine OEMs. The company enjoys a strong position in a web of relations involving most OEMs. However, more and more risk-sharing contracts involving highly innovative and complex parts means that MTU must manage its risk portfolio. The company has entered other engine related services such as the maintenance-repair-overhaul (MRO) market characterized by far more players than the engine parts business. At one stage the company was sold to the leverage-buyout company KKR in the US, raising many political issues regarding the military part of the company. Although many see MTU as a company that could become the fourth independent OEM in aero engines (GE, Rolls Royce and Pratt & Whitney) others argue against such a move. The case has been used in MBA strategy classes to highlight the costs and benefits of a complex web of strategic alliances.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
