Airbus A380 Turbulence Ahead Harvard Case Solution & Analysis


After the World War II the commercial aircraft industry faces severe innovation and recognition, the need for the larger aircraft increased as a result of growth in the needs of peoples to travel around the globe for the spending of vacations and the business purpose. Due to many commercial and operational reasons, the competition in the commercial aircraft manufacturing industry is very low. However, there was the duopoly of two manufacturers of commercial aircraft Boeing and Airbus. Both the manufacturers faces harsh operating and commercial weaknesses in their early time but, through continuous updates in the technology both producers overcome their weaknesses. Both Airbus and Boeing merges with the specialist manufacturers of aircraft which also plays a major role in eliminating the competition from the industry.

However, many governments owned entities specializing in the manufacturing of aircraft are now considering expanding their operations to compete with the two industry giants. The fact that there will be increased demand of customer traveling is appealing the investors to set up entities responsible for the production of airplanes which are more reliable and safer as compare to the planes of Airbus and Boeing.

In the mid-1960s, France, United Kingdom, and Germany enter into a strategic alliance to form a company which can reduce the dominance of the United States in constructing the large passenger jet. The first airplane produced by the consortium of the three countries was A300 which was quite successful and plays a major role in the long-term survival of the alliance. France and United Kingdom holds 37.5% of the Airbus while the other 25% share is of Germany. Later the consortium was liquidated, and the new investors took over the control. British Aerospace owned 20% shares while the other 80% power is shared by Deutsche Airbus of Germany (37.9%), Aerospatiale of France (37.9%) and the remaining 4.2% is held by the CASA of Spain. In the mid of 2000, the Airbus industry was transformed into a formal joint stock company, and the consortium of the three investors merges to form European Aeronautic Defense and Space Company, they represent 5 out of 7 directors on the board of directors.

Airbus A380 Turbulence Ahead Harvard Case Solution & Analysis

Airbus A380 can carry more than 550 passengers and is the largest aircraft at that date. Due to the technicality in the production of the Airbus A380 and various supply chain management issues the production of A380 is halted and delayed for two times which resulted in the massive loss of reputation, customer orders and cash resources. The effect of the output delay does have a large impact on the short-term performance and also on long-term performance as well.

PESTEL 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 EADS 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.......................

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