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Report on Airbus

Industry Overview

The global airline industry has been found as one of the largest industries. However, air travel has been used for many years, but now it has become significant part of vacations and business travel. The airline industry, like Airbus, has been attempting to produce new planes and updated designs for older planes. In addition, the company is committed to the safety of its passengers and to its workers, whereas to adopt new change with the changing trends, Airbus has come up with a solution that helps to make airplanes lighter and weight restrictions. New A380 of Airbus’ is best to be fitted with carbon-fibre composites to produce the jet slimmer (Rothman, 2004). Airbus also intends to use these composites for about 15% of the A380. Moreover, being used by Airbus is an aluminum alloy and glass fibre sandwich; it will save the A380 a metric ton on final weight (Rothman, 2004). 

Global Issues

The increasing change in the environment causing environmental risks is the reason to create newly designed planes as global aviation industry estimates 2% of manmade CO2 emissions that may create climate change, whereas, it carries a $2.9 trillion effect on the world economy accounts for 80% of the world GDP (Final, 2006). However, environmental risks associated with the aviation industry are still taken into account as very seriously; therefore, new ideas are created and carried out continuously to help in the reduction of environmental risks, emphasizing on research and development of new aircrafts. To respond to such climatic changes, the Aviation and Environment Summit 2006 was aimed at tackling environmental challenges that the industry faces these days. The issues and recommendations that were examined at the summit is related to aviation industry that it encounters to become“green,” has an effect on the aircraft manufacturing industry. With regard to newly designed planes of Airbus A380, it is found that creating new planes that are environment friendly has become significant. Moreover, new A380 of Airbus test flight to London proved that noise produced by plane creates noise pollution, as, in the result of test; complaints were received from close residents of airport (Land, 2006). However, the plane manufacturing industry has received encouraging result as it has achieved to drop 50% release of nitrogen oxides (NOx) from aircraft engines while further decrease is planned to achieve in 2020 (Final, 2006). With respect to achieve further, there are two alternatives found that are liquid (DTL), which reduces CO2 emissions, and hydrogen to power the engines (Final, 2006). However, aviation industry has identified serious issues in becoming green; there is also benefit for aircraft manufacturers. 


However, there are immense environmental risks involved in the plane manufacturing, besides environment risks there are other risks related to business such as occurrence of cyclicality in the aircraft market, relationship between increased commercial markets. Other factors involved can cause market fluctuations including the average age and technical obsolescence of the fleet relative to new aircraft, the number and features of airplanes taken out of service, load of passengers, airline-pricing policies, airline financial condition and deregulation in the industry (Annual, 2006). Other risks may be of terrorism activities as it can be related with the downward spin of the industry. Studies have found that there was psychological impact on the passengers after 9/11 attacks. This has made the airline industries to invest more on the security arrangement while increasing the cost of the industry. Moreover, other issue has been identified related to limited availability of subsidies amount from the government. However, aircraft industry produces goods that are very large and very technical and they need to have an extensive and tedious amount of research and development for long time.Hire assignment writer to get help.

For aircraft manufacturers like Airbus, it is difficult to have sustainable cost for the research and development. However, there is funding from government and other interest loans available to improve the production of planes but it is practically helpful to the future in the aircraft industry. Other than this, there is drawback of the fact that subsidies are guaranteed and considered illegal in near future. Similarly, there exists competition as a great risk within airline industry. As mentioned before, the products produced in this industry are developed for long times as they are technically and economically huge, therefore, airlines manufacturers cannot afford to make mistakes, and mistake in the production can shift most of the support to the competition, that cost loss of millions, and in some cases billions of dollars.

Future Trends

It has been previously explained that the aviation industry would be affecting the economy continuously in the upcoming years. This could be evidenced by the growth of the Aviation and Environmental Summit that is encouraging industries about the plantation and greenery. Therefore, technology would greatly help in the accomplishment of the specified task. In addition to the advancement of the whole economy in the field of technology, the industry of aircraft is also looking forward for the implementation of the technology in their business. These technological enhancement and implementation of software would also help in the expansion, preservation and training of the new aircrafts. For the purpose, the companies like Airbus are moving to the use of these technological advancements from the use of manuscripts. 

Beside it, a large portion of population is travelling to different parts of the world on daily basis and due to these facilities; this tackling issue is no more a difficulty. The developments of the relatively larger aircrafts are in the process of development to overcome these issues. On the other hand, according to Synder (2006), there is an increased growth of 27.2% in the needs of the private air journeys as the same could be depicted from the records of the year 2005 of the General Aviation Manufacturers Association.  The relative increase might be the effect of the rise in the travel fares of the business air travels, as apart a very high cost; passengers also face problems of long waits between the periods of check-ins and boarding of the flights. Moreover, there has been an increased popularity of the three to six seat privately owned aircrafts, commercial jets and Very Light Jets (VJL) as the business enterprises and private persons are becoming so wealthy to purchase these airplanes.

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