Research Overview The Airbus model A380 is truly one of the most ambitious projects that were undertaken by the company in recent years, shoring a new benchmark for commercial aviation both for itself and its competitors. The behemoth, for all its size and payload capabilities, boasts an approximate 20% increased efficiency in its fuel to seat ratio in respect to the other aircrafts. This makes the A380 one of the most fuel savings and environment friendly aircrafts of its time, due to decreased fuel combustion, resulting in less carbon dioxide being produced in respect to its size. This has been coined by Emirates Airline “the most significant advancement in reducing fuel consumption and emissions in four decades.” On the economic front, the Airbus 380 is able to carry more passengers on each flight, creating cost savings while maintaining capacity. These technological advances ensure that the equilibrium quantity for the flights will be lesser than what it used to, as its supply increases. In turn, this could mean increased revenue for commercial aviation industry for the following years. However, it is worth noting that despite all its marketing hype and sales strategies, the demand for this supposed technological breakthrough masterpiece had seen a decline in recent years. According to Airbus sales Chief John Leahy, there is an expectation that the demand orders for the A380 “has been slowing down”. This study will show the trends as well as some of the reasons for it. Variables identified Dependent Variable(s): The demand for A380s in Asia for the next two decades. Airbus, as mentioned before, had taken its commercial industry advancements to the next level and had set a new benchmark both for itself and its competitors ... ... middle of paper ... ...Reassessing the A380. Aviation week & Space technology, 14. Retrieved from http://www.aviationweek.com.ezproxy.libproxy.d.b.erau.edu/awin/ArticlesStory/tabid/975/Status/IPAddress/Status/IPAddress/Default.aspx?IPAddress=Default.aspx&keyWord=A380+demand&id=%2farticle-xml%2fawx_05_14_2013_p0-578682.xml. Sean Broderick. (2014, January). A380 May Have Brighter Future, After All. Aviation Week & Space Technology, 12. Retrieved from http://www.aviationweek.com.ezproxy.libproxy.db.erau.edu/awin/ArticlesStory/tabid/975/Status/IPAddress/Status/IPAddress/Default.aspx?IPAddress=Default.aspx&keyWord=A380+demand&id=%2farticle-xml%2fAW_01_27_2014_p12-653095.xml. Walesairforum. (2013, January). Airbus to stabilize A320, A330, A380 production rates this year. Retrieved from http://walesairforum.wordpress.com/2013/01/28/airbus-to-stabilize-a320-a330-a380-production-rates-this-year/.
Although the Model 200 is the older version of the B200, it is considerably cheaper and still a popular choice for small aircraft pilots and modest executives. Unfortunately, while the longevity of this aircraft has been demonstrated by its consistent sales, Beechcraft has only chosen to make a few upg...
Use of a single-type aircraft fleet. The A320 Airbus has an increased seating capacity of 30 seats (24 after additional seating reconfigurations), is cheaper to maintain, fuel efficient and reduces training costs, relative to other aircraft models used in the industry.
No matter how a business operates, change is inevitable and affects all businesses. CAMERON SMITH investigates the changes Qantas have had to undergo in order to keep up with their competitors, whilst navigating the challenges of low cost of fares.
As airline industry is a competitive marketplace, the airline companies use new technologies to improve their efficiency and decrease the overhead costs, including ‘advanced aircraft engine technology, IT solutions, and mobile technology’ (Cederholm 2014). The technology changes including technology improvement, new innovation and disruptive technology. The disruptive technology need to meet the characteristics of ‘simplicity, convenience, accessibility and affordability’ (Christensen 1995). The technology changes would bring both opportunities and threats to airline companies. Since Labour cost and fuel costs occupy 50% of most airlines operating cost (Groot 2014). Therefore, if new technologies could be disruptive in the two aspects, there will be important changes to current airline
The Boeing Corporation is one of the largest manufacturers in the world. Rivaled only by European giant Airbus in the aerospace industry, Boeing is a leader in research, design and manufacture of commercial jet airliners, for commercial, industrial and military customers. Despite enjoying immense success in its market and dominating an industry that solely recognizes engineering excellence, it is crucial for Boeing to ensure continued growth through consistent strategy formulation and execution to avoid falling behind in market share to close and coming rivals.
The future of the aerospace industry will involve gradual changes in the near term, with the prospect of more radical shifts in the decades t...
Airline and travel industry profitability has been strapped by a series of events starting with a recession in business travel after the dotcom bust, followed by 9/11, the SARS epidemic, the Iraq wars, rising aviation turbine fuel prices, and the challenge from low-cost carriers. (Narayan Pandit, 2005) The fallout from rising fuel prices has been so extreme that any efficiency gains that airlines attempted to make could not make up for structural problems where labor costs remained high and low cost competition had continued to drive down yields or average fares at leading hub airports. In the last decade, US airlines alone had a yearly average of net losses of $9.1 billion (Coombs, 2011).
The engineering section of aircraft manufacturing is quite old. It is characterized by a few firms that keep Rolls-Royce on its toes in terms of competition, like General Electric. The small number of firms can be justified by the high cost of starting of...
In order for revenue management to be successful, four fundamental conditions must be met. The first requires a permanent amount of supply available for sale. Meaning, a fixed amount of seats per aircraft should be available per route. Second, resources sold must be perishable. Seats are a perishable items, if not sold they terminate without value. Third, the most vital portion of r...
The main opportunities that the scheduled air transportation will have in the next five years are the possible decrease of TSA agents at airports, technology increasing the safety and comfort of the flights for the passengers and the more availability of flights for the consumers to choose from limited airlines.... ... middle of paper ... ... Dixit, A. (2000).
Boeing was founded in 1916 in Seattle, Washington by William E. Boeing. The company is regarded as one of the world’s leading manufacturer of commercial and military aircrafts; it controls more than half of the passenger aircrafts’ market in addition to military jets and helicopters. The company also has other contributions in space technology and projectile systems (Amir, 2013). This report will analyze Boeing Company’s latest marketing strategy that the company has been dealing with for the past five years whilst the production of its much anticipated 787 aircraft. Throughout the report the aircraft will be referred to as the 787, the ’87, or the ‘Dreamliner’. Mainly, this failed strategy affected the company's negatively in terms of both sales and reputation.
Airline industry is affected by no. of factors such as fuel price fluctuations, high fixed costs, strong influence of external environment and excessive use of marginal costing by carriers. Recessions in the industry tend to last longer, while recovery periods are generally shorter. Over the past nine years, it is observed that industry has made losses for five years and during the profitable years margins were on a lower end. The airlines industry is acutely sensitive to external events such as wars, economic instability, government policies and environmental regulations.
Macroeconomic environment: The airline industry has proven particularly sensitive to phenomena such as terrorist attacks, wars, outbreaks (SARS), drastic currency fluctuations, and the like. These phenomena tend to have a significant impact on the cost of fuel, overall demand for air transportation, tourism, etc.
Within the following decade need for air-transport made it very desirable. This is mainly due to World War I as many of the retired bombers were turned into commercial airliners. Soon after these flights commenced it became very apparent that in order to be making any financial again there needed to be more people on these aircraft as they could initially fit four passengers (Century of Flight 2008). British aviation company de Havilland built a ten passenger plane that seated it occupants in comfort called the de Havilland Dragon. 1930’s saw the expansion of the commercial airliner market (Century of Flight 2008). As the need for air-transport grew so did the supply, as for any demand. Ailing such as Lufthansa (Germany), United Airlines (United States), Imperial Airways (Britain) and KLM were just some of the airlines that started operating in this
...fares, which in turn affects their profit. The other four marco forces can be exploited to the LCCs advantage. Technology is LCCs best option to expand its business as its low cost and aligns with the LCC model. Deregulation in other markets serves as an opportunity for LCCs to expand into other regions and tap on the latent potential of the market. Most industries have a direct proportional relationship with the economy; however, the LCCs have a inversely proportional relationship with the economy and they can take advantage of the economic downturn to improve its financial position. Last but not least, the demographic factor dictates the market that LCCs should target and if done properly, it will provide a constant stream of revenue. In all, the macro-environmental factors cannot be ignored as they present could present an opportunity or threat to the airline.