Failure of Airbus A380 Production

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Table of Contents

Abstract
Introduction
Narrative Body
Methodology
Findings
Conclusion
References

Abstract

It has been more than a decade since first commercial flight and the Airbus A380has not experienced the success once thought it would. Many airlines have retired the A380 and opted for smaller planes for various reasons. However, it is unknown why the production of the plane has stopped. This research is conducted to find out the reasons behind the failure of the production of Airbus A380. Three methods of data collection, that is using documents and records from the company, survey and interview, were used. For the survey, one hundred and twenty participants agreed to be involved and three others for the interview. After analysing the data, some of the reasons behind the failure include inaccurate predictions, size, as well as its inefficiency. With the current situation of the fuel prices and reduced number of passengers, having a plane that uses four engines is not economical.

Introduction

Airbus Company decided to come up with a spacious plane model named Airbus A380. Throughout the entire world and among all aircrafts ever constructed, it is ranked as the largest. In 1990, with the intention of fighting for the market share with Boeing 747, the company announced its intentions of coming up with the plane. To start the process, it launched more than ten billion programme ten years later. The initial model was revealed in 2005 in Toulouse with its first flight in the same year. Issues with the electrical wiring resulted in a 2-year delay plus the development cost rose to eighteen billion pounds. The company received its certificate from EASA as well as the United States Federal Aviation Administration in 2006. The aircraft was delivered to Singapore Airlines as the first delivery in 2007 and started service a few days later after delivery. The production of the aircraft climaxed at thirty annually in 2012 as well as 2014. Nevertheless, the company admits that the twenty-five billion dollars it invested in the project cannot be recovered. Airbus announced in early 2019 that production of the aircraft would end in 2021 after last delivery to Emirates.

More than a decade after first air travel for commercial purposes, several airline companies have opted for stopping the use of the A380 plus its production is no longer going on. In spite of the plane being spoken so highly of as compared to others including the Boeing 747, it has remained unsuccessful in the market. Apart from focusing on the plane alone, it is essential to identify the issues that hinder the air travel sector and thus airlines. Understanding the issues can help in pinpointing the root cause behind the issue of Airbus A380. The air transport industry is huge and supports so many people working as staff of various airline companies. It also contributes a large portion to the world economy. Regardless of the many challenges until the COVID-19 pandemic emerged, it was on the path to success. It is correct to claim that even though the pandemic adversely affected the industry, it has started recovering from the impact left by the pandemic and may get back to where it was prior to the pandemic. This paper looks at the review of the problems facing the airline industry as a whole, the methodology used in the research, findings on the failure of A380 production and the analysis.

Narrative Body

Review of the Airline Industry

Almost fourteen years from the initial commercial flight, many airlines have retired the A380 and its production has stopped. Even though the aircraft is an engineering masterpiece, it was not successful in the market, as suggested by (Nelson, 2020). Apart from just focusing on the aircraft alone, it is important to understand the challenges that face airlines. The air transport industry is a universe in itself and encompasses a huge workforce plus contributes a major portion to the world economy (Arjomandi et al., 2018). It was set for significant growth, regardless of the many challenges until the COVID-19 pandemic emerged (Gupta et al., 2020). It is correct to claim that even though the pandemic adversely affected the industry, it has started recovering from the impact and may get back to where it was prior to the pandemic.

The air transport market has been on the rise and appeared to have success before the pandemic hit. In 2018, a study revealed that the world aviation market outlook had been positive within a few years earlier (Jackson, 2021). The study report shared that at that moment, the world air transport industry supported more than sixty five million jobs plus contributed more than two trillion dollars in global financial activity (Jackson, 2021). Moreover, it stated that a free-trade strategy would aid further the growth in the sector. It will also come to record more than five trillion dollars in financial activities by 2036 while also guaranteeing close to one hundred million job opportunities (Jackson, 2021). The sector plays a key role in the modern society but it is essential to point out that it has its own challenges. From struggling with recessions to governmental regulations as well as terrorism to labour shortage, such issues can lead to airline reducing or even stopping production.

Fuel efficiency is among the main challenges facing the airlines. Availability of fuel as well as costs remains a significant financial factor impacting the airline (Belhadi et al., 2021). High prices have a direct influence on the financial portfolio of airlines. With the increase of airline companies every year, the prices of fuel have skyrocketed which has resulted in a vicious cycle. Other alternatives for fuel have failed to be impactful and thus maintaining efficiency has remained a challenge for the industry.

The global economy is also a challenge for the sector and thus the airlines. The status of the global economy is a primary issue in the market. For instance, the 2008 economy crisis had a major effect on the sector. As the economy takes a hit, travel as well as fuel prices rise while the number of passengers reduces. The effect of the recession on other sectors such as tourism is also a critical factor impacting the sector. As the travel companies seek development in different nations plus explore new ways, they have to remember the market situation as well as volatility in the regions. Different nations have unique economic situations which airliners need to consider when they plan for global expansion.

The experience and comfort of a passenger while on a journey is also a challenge in the sector. The air transport sector is service-oriented and its success is reliant on how great the passengers feel, as suggested by (Ika et al., 2021). The reason why this is a challenge is because there is always a group of passengers who are not contented with the services. Nevertheless, this is something that has resulted in companies being seamless through the entire air travel. To accomplish a state whereby all passengers are satisfied with the services is difficult because no customer is alike. Surveys on customers and their feedbacks show that not every passenger has a great travel experience, as suggested by (Ika et al., 2021). For example, an IATA survey in 2017 showed that only about fifty-six per cent of North American customers were okay with the travel experience. This shows that companies will continue to struggle to impress all their customers at once.

Airline infrastructure is also a huge challenge for the airlines worldwide. Airports require consistent upgrade of its infrastructure such as terminals, runways, hotels, lounges, among others (Li et al., 2020). There is a significant competition in the area of infrastructure as it determines how even customers view a company. To sustain the image of an airline and stay ahead of others, onsite facilities like the aircraft ground handling systems will require regular renovation. While doing that a few times can be beneficial to a company and increase the number of customers, doing it regularly requires a huge financial investment (Ika et al., 2021). Even more crucial is the fact that an aircraft needs a regular upgrade and maintenance too. This is because the safety of the customer depends on the condition of an aircraft. Having faulty aircraft seating or doors is liable to get an airline sued. Infrastructure is among the most crucial challenges of the market as carriers are support to maintain available fleet plus also guarantee to buy the latest ones while ensuring lowering costs as well as fuel efficiency.

Worldwide congestion is also a major challenge facing airlines around the world and thus the sector. Several years ago, the air travel was a luxurious event, which a few rich people engaged in (Ika et al., 2021). It is no longer the same and more people are traveling using air transport which has resulted in overcrowding of many airports globally and flight delays. Majority of flights appear to be full, the terminals congested, and the skies overcrowded with the excessive number of aircrafts. Air traffic plus airport congestion are significant challenges facing the market which appears to lack the solutions. Carriers are still struggling to make seamless trips for customers and thus remain to be a viable problem.

Advancement in technology is among the challenges the airline sector is facing. Technology is a double-edged sword that in spite of the good it has brought to the world, the increase on its dependence has resulted in vulnerability of the sector. For example, if there is a software problem, the operations may remain crippled until resolution. If there is inadequate financing, upgrade of infrastructure like the communication system may prove impossible which might result in the failure if the whole system.

Terrorism which is a security issue is among the major challenges of the modern times. Tragedies from past times have resulted in fear of many passengers as well as staff (Woo et al., 2021). Even though, terrorist attacks have reduced recently, it still remains a threat as companies in the sector have to remain vigilant always. The rise in fear results in rigorous check-ins plus consequently longer lines as well as delays. It has in the past forced companies to develop highly secure screening methods as well as equipment (Woo et al., 2021). Even political conflicts between countries can be viewed as a major challenge of the industry. Irrational regulations by one nation because of conflict can make it hard for carriers to transport passengers conveniently as well as move cargo in the international territories. Lastly, without doubt, climate changes as well as environmental problems are issues that prove to be a challenge to airlines globally. It is something that has gone on for a long time spanning for more than three decades.

Methodology

In this research, the main research question is the reason behind the failure of the Airbus A380 production. Knowing this, it is important to find the right method of data collection that suits such a study. Studying about an aircraft involves much review of available data in documents and records as well as online surveys and interviews. I decided to contact the Airbus Company through email and ask for a chance to access some documents and records that would help in my study. After they agreed, it was a great opportunity as I analysed the data myself and therefore it was difficult to obtain incorrect information. The advantage of using documents in such a research is that it allows an individual to obtain consistent information so that analysing it becomes easy.

After studying the documents consisting of information of the plane, I decided to use survey method. Conducting a survey can be difficult and has its limitations especially if people one requires response from are far. Therefore, to counter this, I settled for the online survey which can accommodate anyone and from any distance. Through the use of mail services, I reached out to over one hundred individuals who work and those who worked for the air travel company to get their opinion on the issue. While sending the surveys to them, I also attached another document that explained how I had accessed their contact information and what the research is about as well as their information would not be revealed to anyone else. Ensuring that they do not have the fear of being exposed empowers them to give unbiased responses.

I collected and analysed the responses through the mail services too as nearly ninety-five per cent of participants submitted their responses. After the survey, it was important to interview a few managers of the company to get their opinion on the issue. Most of them declined as they cited their employment status as a concern. However, three executive managers accepted but in the condition it does not involve questions that would put their jobs at risk. After the interview, the information gathered was enough to come up with reasons why the production stopped.

Findings

The aircraft is among the largest commercial models with many claiming it as the largest one with the capacity to hold up to eight hundred and fifty-three passengers at once. Being the lone commercial aircraft to have more than full deck, it is considered an engineering masterpiece (Woo et al., 2021). Since the first flight more than a decade ago, it has two hundred and fifty one orders with one hundred and twenty-three belonging to the Emirates Airlines. Nevertheless, several airlines have already started retiring the aircraft and one of the reasons is the pandemic. Airbus has closed production plus it is testing last aircraft after fourteen years of production.

Among the reasons behind failure of its production is that the aircraft is too big. It is noteworthy to know that many companies did not order for the aircraft because of its massive size. With a wingspan that is bigger than several Boeing 737s, it proved impossible to fill the plane to full capacity on a trip to a particular route. Due to size, the aircraft could only land at particular airports which needed renovation including having wider gates that could accommodate the plane.

Another reason is that the aircraft was inefficient and that because of its size, more issues of inefficiency arose, as suggested by (GENG & BHATTACHARYA, 2021). The plane needed four engines to remain on air which is highly inefficient for companies because of the amount of fuel burning. The smaller Boeing 787 with two engines consumes five thousand and four hundred litres of fuel every hour while A380 consumes more than twice the amount every hour. After the tragedy in 2001, fuel costs skyrocketed which decreased the popularity of four engine aircrafts. Nevertheless, Airbus had already invested much in the study plus development of the model that it appeared too late.

Another reason is the Airbus company inaccurate predictions of the aviation market. At the start of the twenty-first century, the company projected that the future of aviation was going to be big size long-term airlines like the Boeing 747 (Ferreira et al., 2020). According to the company, smaller planes would utilize less preferred routes and airports to a hub airport plus fly to a second hub airport and then to another less preferred airport. Nonetheless, the trend did not last and the hub-and-spoke model as it was known no longer was popular. In addition to above reasons, it can also be said that the recent pandemic to hit the world, COVID-19, has resulted in a significant drop in air travel demand. The lockdown restrictions as they began to be implemented by different nations impacted the number of flights as well as passengers. As a result, many companies in the air travel industry began going back to smaller planes, for example, Airbus A220.

Conclusion

Nearly fourteen years from the initial commercial flight, many airlines have retired the A380 and its production has stopped. Despite being termed as an engineering masterpiece it has failed to be successful in the market. Apart from just focusing on the aircraft alone, it is important to understand the challenges that face airlines. For instance, terrorism, pandemics that lead to lockdown restrictions, high fuel prices as well as unsatisfied customers. The air transport industry is a universe in itself and encompasses a huge workforce plus contributes a major portion to the world economy.

It was set for significant growth, regardless of the many challenges until the COVID-19 pandemic emerged. It is correct to claim that even though the pandemic adversely affected the industry, it has started recovering from the impact and may get back to where it was prior to the pandemic. A shocking revelation in the research is that Advancement in technology is among the challenges facing the air travel sector. Technology is a double-edged sword that in spite of the good it has brought to the world, the increase on its dependence has resulted in vulnerability of the sector. For example, if there is a software problem, the operations may remain crippled until resolution. If there is inadequate financing, upgrade of infrastructure like the communication system may prove impossible which might result in the failure if the whole system.

References

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Ferreira, J. J., Fernandes, C. I., & Ferreira, F. A. (2020). Wearing failure as a path to innovation. Journal of business research, 120, 195-202. Web.

GENG, X., & BHATTACHARYA, L. (2021). The rise and demise of Airbus A380. Web.

Gupta, M., Abdelmaksoud, A., Jafferany, M., Lotti, T., Sadoughifar, R., & Goldust, M. (2020). COVID-19 and economy. Dermatologic therapy, 33(4), e13329-e13329. Web.

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Jackson, R. (2021). Airbus A380. Airbus A380, 1-88. Web.

Li, X., Zhang, G., Zhao, X., Zhou, J., Du, G., & Chen, J. (2020). A conceptual air-lift reactor design for large scale animal cell cultivation in the context of in vitro meat production.Chemical Engineering Science, 211, 115269. Web.

Nelson, C. A. (2020). Investigating the Airbus A380: Was it a Success, Failure, or Combination?(Doctoral dissertation, University of Oregon). Web.

Woo, A., Park, B., Sung, H., Yong, H., Chae, J., & Choi, S. (2021). An Analysis of the Competitive Actions of Boeing and Airbus in the Aerospace Industry Based on the Competitive Dynamics Model. Journal of Open Innovation: Technology, Market, and Complexity, 7(3), 192. Web.

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