Airbus A380 Turbulence Ahead Harvard Case Solution & Analysis

Airbus A380 Turbulence Ahead Case Solution

PESTLE Analysis:

Political Factors:

The Airbus is controlled by the various countries of Europe, if the political condition of a single country deteriorates, it can impact the performance of the company. Furthermore, if the relations between the countries owned WADS faces some clashes, it can also affect the performance of the Airbus performance negatively. As various countries are involved in designing the operational policies of the Airbus, there is an increased probability of the rise of conflicts.

Some government owned airlines place the aircraft order by analyzing various factors; the primary factor is the condition of relationship with the airplane manufacturing country. If the trading relations of a country are adverse with any of the state which controls Airbus, it may not place an order due to this adverse trading condition.

Economic Factors:

The economic factors are positive for the WADS because of many aspects, the competition in the airplane manufacturing industry is very low, this might play a major role in the future price of the planes and also have a significant impact on the demand for the Airbus airplanes in future. Additionally, the competition might also be low in future due to the high capital required for setting up the plant responsible for the manufacturing of the aircraft, on the other hand, new entrant might also have to face some stringent laws and regulations due to the sensitive nature of the operations.

The demand for the travel in future is also forecaster to increase drastically, which is favorable for WADS because the airlines will have to acquire more planes to cope with the increasing demands.

However, the are many economic factors which are against the Airbus A 380; the fact that Airbus fails to meet the delivery deadlines on many occasion may have an enormous impact on the revenues and profits of the Airbus in future. Some customers already showed their intentions of terminate their contract and association with Airbus in future because of the failure to meet the delivery dates of A 380. The delays also result in the impairment of the reputation of the Airbus, and also it has to face severe penalties from customers to compensate their loss.

Social Factors:

Social factors are also critical for the future of WADS; many countries might take the initiative to develop the local airplane manufacturing industry to reduce the dependency on the foreign companies which can reduce the demands of Airbus A 380 in future. Many local customers of airlines might perceive it as unethical to travel in the jets of International Industries, and they might want to travel in the airplanes which are manufactured locally.

Technological Factors:

To maintain the performance of the aircraft it is necessary to incorporate latest technologies in the manufacturing of plane. The case study mentions that the Airbus A 380 is equipped with the latest technologies. Airbus also brings various technological innovations in the Airbus A 380 which plays a major role in getting the new contracts to construct Airbus A 380.

It is clearly evident from the case study that Airbus spent an enormous amount of cash reserves in the research and development of its aircraft. But it might be possible that the production line of Airbus A 380 is not updated with the latest technology technological obsolesce of suppliers, and A 380 might be the primary reason for the delays in the deliveries of A 380.

To maintain the profitability, Airbus should have to design A 380 in such a manner which could result in the minimum fuel consumption which is only possible if it uses most modern technology in the production of A 380. Moreover, innovation and technological advancement will also appeal the consumers to travel in the A 380.

Environmental Factors:

Now a day many consumers are critical of the impact of aircraft on the environment, they only want to fly in the planes which have the minimum impact on the environment. Peoples tend to boycott products which have an adverse impact on the natural environment of their countries if A 380 has a massive carbon emission, the customers might not travel in the A 380.

Airbus A380 Turbulence Ahead Harvard Case Solution & Analysis

On the other hand, just like customers, many governments are also critical about the impact of the airplanes on the natural environment. If A 380 fails to take into account this factor it might face severe penalties from the government, this factor is of particular importance and fails to address this issue can hit the going concern status of the Airbus.........

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