Airbus is in a difficult financial time currently and their decision making over the last decade or so is mostly to blame.
Airbus bet the farm on proliferation of the traditional "Hub and Spoke" system going into the future by engineering the A380. Billions were spent on the project, while Boeing bet on more Point-to-Point development within the airline industry with the creation of the widebody 787. Obviously, Boeing was right and the A380 will likely never be profitable for Airbus.
Airbus then spent tons of money on the A350 to compete with Boeing's 787, offering superb fuel efficiency (though still less efficient than the 787) and higher capacity. However, they were 8 years or so late to the game. Boeing already had a significant backorder for the 787 and even though the A350 has hit the market, many airlines are choosing to stick with the cheaper 787. This is not surprising as the 787 is cheaper and many airlines already have the infrastructure for the 787 and purchasing the more expensive A350 would also require Airlines to spend much, much more on building the infrastructure for accommodating that aircraft as well (pilot training, parts stores, line maintenance training, etc.).
Airbus, while the A350 was under development was feeling a lot of pressure to address that market quickly and were beset with setbacks on the development of the 350. So, they decided to re-engine the A330- creating the A330NEO (New Engine Option), which would make the aircraft more efficient to operate. However, the A330 was roughly 10 years old by that time and Airlines were more than hesitant to purchase a replacement aircraft for theirs when theirs were still fairly new. Not surprisingly, Airbus has fielded 0 orders for the A330NEO.
Orders for the A321 were revived a bit when Airbus re-engined that airframe, creating the A321NEO. While this has been a profitable maneuver for Airbus, the market wherein the A321 competes in is dominated by Boeing's 737 family of aircraft. It seems difficult to envision Airbus carving out a bigger market share then they have already, which will limit the sales performance of the A321NEO.
All of this has left Airbus in a vulnerable and cash-strapped position and Boeing smells blood in the water. Boeing is cutting prices on the 787 and 737 MAX airframes, while soon introducing a 757 replacement- a high demand airframe and one that Airbus has yet to address (at least they haven't yet announced plans for any new airframe to address this market demand). While they certainly are struggling, it seems unlikely that Airbus will be allowed to go under especially with Airbus's military contracts. So, if needed, who do you think would swoop in and save the conglomerate?
Airbus bet the farm on proliferation of the traditional "Hub and Spoke" system going into the future by engineering the A380. Billions were spent on the project, while Boeing bet on more Point-to-Point development within the airline industry with the creation of the widebody 787. Obviously, Boeing was right and the A380 will likely never be profitable for Airbus.
Airbus then spent tons of money on the A350 to compete with Boeing's 787, offering superb fuel efficiency (though still less efficient than the 787) and higher capacity. However, they were 8 years or so late to the game. Boeing already had a significant backorder for the 787 and even though the A350 has hit the market, many airlines are choosing to stick with the cheaper 787. This is not surprising as the 787 is cheaper and many airlines already have the infrastructure for the 787 and purchasing the more expensive A350 would also require Airlines to spend much, much more on building the infrastructure for accommodating that aircraft as well (pilot training, parts stores, line maintenance training, etc.).
Airbus, while the A350 was under development was feeling a lot of pressure to address that market quickly and were beset with setbacks on the development of the 350. So, they decided to re-engine the A330- creating the A330NEO (New Engine Option), which would make the aircraft more efficient to operate. However, the A330 was roughly 10 years old by that time and Airlines were more than hesitant to purchase a replacement aircraft for theirs when theirs were still fairly new. Not surprisingly, Airbus has fielded 0 orders for the A330NEO.
Orders for the A321 were revived a bit when Airbus re-engined that airframe, creating the A321NEO. While this has been a profitable maneuver for Airbus, the market wherein the A321 competes in is dominated by Boeing's 737 family of aircraft. It seems difficult to envision Airbus carving out a bigger market share then they have already, which will limit the sales performance of the A321NEO.
All of this has left Airbus in a vulnerable and cash-strapped position and Boeing smells blood in the water. Boeing is cutting prices on the 787 and 737 MAX airframes, while soon introducing a 757 replacement- a high demand airframe and one that Airbus has yet to address (at least they haven't yet announced plans for any new airframe to address this market demand). While they certainly are struggling, it seems unlikely that Airbus will be allowed to go under especially with Airbus's military contracts. So, if needed, who do you think would swoop in and save the conglomerate?
