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fter celebrating four decades of Address environmental concerns impacting overcome the traditionally conservative innovation, , - the airline industry, opinions of crewmembers, maintenance and The Future based looks ahead to Provide the best possible flying experience operations teams, and finance departments. the next 40 years. In its recent for passengers. More importantly, the financial benefits for “The Future by Airbus” report, Technology, combined with economies of airlines had to be clear to demonstrate the Athe manufacturer seeks to determine scale, is the main driver in making advantage of Airbus products against well- what air transport will look like in the year more economical. established competitors. 2050. Through this initiative, it works with From the onset, innovation has been key As part of the process, Airbus developed a By Airbus various stakeholders and experts to anticipate to competing with established manufacturers team of fleet- and network-planning experts the global needs of a better-connected and , Lockheed and McDonnell Douglas. who model, evaluate and determine, for each Airbus’ Innovative Marketing Supports Sustainable Growth more sustainable world. While three- and four-engine aircraft were potential customer, the revenue and cost Airbus believes that the aviation indus- standard for large aircraft at the time, Airbus’ benefit of flying Airbus aircraft. Using special try as a whole must focus on technological founders decided to design and develop a support tools to assist with decision making, By Christophe Ritter I Ascend Contributor advances that will satisfy passenger and mar- competitive two-engine wide-body aircraft. and working collaboratively with its airline part- ket demand, the growing population and its The would be lighter and more ners, Airbus’ marketing team creates specific demographic profile, and respect all aspects economical than its competitors. After a slow scenarios to design the optimal fleet size and of the environment. start, the aircraft became a hit, reaching a sub-fleet requirements in the medium and long Airbus has come a long way since it market share of 26 percent by the mid-1970s. term to maximize airline profitability. launched four decades ago. It has gone from a With the development of its product line, This innovative partnership approach allows vision to consolidate and develop an indepen- Airbus pioneered innovations such as: airlines and Airbus to quantify the revenue and dent European aviation industry, which led to commonality, cost benefits of each incremental aircraft or its creation in 1970, to being today’s market Fly-by-wire controls that reduce training sub-fleet. leader with more than 11,500 aircraft orders. time and costs, For years, Airbus has been in the position At the heart of this growth has been creating New weight-saving materials such as car- of the challenger to penetrate new airline the world’s most modern aircraft by building bon fiber, customers. However, marketing challenges for innovation into all of its products. Time- and cost-saving centralized mainte- Airbus are changing: Airbus incorporates advanced technology nance. Airbus experiences more fleet renewals to: An ambitious focus on innovation required rather than gaining new customers because Improve customer profitability, ground-breaking marketing techniques to of the success of its sales campaigns. This

Airbus Facilities More than 11,000 people are employed at Airbus facilities in the Toulouse, France, area, where final assembly lines are located for the A320 family as well as A330/A340 and A380 aircraft.

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capitalize on their respective skills. It also our current product line did not even exist. In indirect paths, because advances in aircraft forces us to be more efficient in the way we 40 years, passengers will enjoy technologies and communications have yet to be matched convince our customers that combined opera- and solutions that are still in our labs today. By in the equipment used by air traffic controllers tions of our products create value for them … communicating about these possibilities, we on the ground. Air traffic management will and for their shareholders. wanted to keep the dream of aviation alive so enable shorter and more direct routings, saving Q: How does the current financial crisis we could benefit from new technologies and fuel and journey times. Airbus is working with affect your customers? services in the next 40 years. several key partners to make this happen … A: A lot of people forget that the financial Q: What role does technology play in Airbus’ both in and the rest of the world. crisis of the last two years has been worse future? How will it translate for your airline Q: What are the medium-term challenges than that of Sept. 11 for the airline industry, customers and their passengers? for Airbus? in terms of earnings impact. Our customers A: Innovation, and the technology that is A: There are many medium-term challenges. want, more than ever, fuel-efficient aircraft part of it, is in Airbus’ DNA. It is still a big Building enough of our modern aircraft family with competitive operating costs. They also part of our company culture. Airbus has been to satisfy the world’s needs is one of them. want reliable products, especially for low-cost very innovative by incorporating new technolo- Introducing the game-changing airlines with high daily utilization rates. Airlines’ gies during the development of its products, into service, and then ramping up deliveries to revenue generators are aircraft, and the airline provided, of course, that they make economic airlines is another. We have also had tremen- industry is based on growth, so their appetite sense. For our customers, this means reliable, dous success with the re-engined A320neo for modern aircraft is still very strong, as fuel-efficient aircraft with good operating num- family, which is the world’s fastest-selling shown by the 2011 order intake. bers. For passengers, this means affordable product line, and we are working to Q: With the launch of the engineer and deliver that, beginning in 2015. program, does Airbus have a hub-and-spoke Q: How do you perceive the threat of Highlight strategy that will prevail for network carriers? new entrants, in particular, Chinese aircraft A: It is incorrect to describe Airbus as hav- manufacturers? ing a hub-and-spoke strategy. Airbus makes A: We recognize that we will be challenged both point-to-point aircraft, such as the A330, Our aim is to by aircraft made in Brazil, Canada, China, Japan A340 and A350 families, as well as hub-to-hub and Russia. However, it has taken us a couple aircraft, such as the double-deck A380. Both continue to innovate; of decades and tens of billions of dollars of strategies (fragmentation and hub-and-spoke) investment to create the world’s most modern are valid, and airlines can chose from the mod- keep our aircraft aircraft family, which ranges from the 100-seat Competitive Airbus A380 Among several key drivers that make the Airbus A380 competitive, it has excellent operating numbers due to the amount of pas- ern Airbus aircraft family that suits them best. A318 to the 500-plus-seat A380. There will sengers it can carry. Three drivers make the A380 very competi- at the forefront of be no shortcut for our competitors. Our aim tive. First, with more passengers, the aircraft is to continue to innovate; keep our aircraft adds more complexity to the fleet and net- customers and its support of the company’s to improve and leverage our own expertise. has excellent operating numbers. Second, the economics, capability at the forefront of economics, capability and work analysis performed by its experts. “The Future by Airbus” concept. Second, we stick to strict confidentiality rules. hub-and-spoke structure is, for some destina- value; and deliver world-leading products to Airbus has a wider range of aircraft, more Question: Airbus’ revenue and fleet depart- What is shared with some of our customers tions, the only way to distribute passengers and value; and deliver our customers. versions of the same aircraft and, with the ments play a key strategic role within its remains between them and us, without time where the volume is not high enough. Third, Q: Where do you see Airbus in five years? Airbus A320 and A320neo families, two gen- marketing division. What are your specific limit. Third, our role is not only limited to fleet the limited resource for airlines is slots. There world-leading A: We will have begun delivering the world’s erations cohabiting together. This creates roles and activities within Airbus? planning studies. Some of our knowledge is are not many new airports and runways so, to most efficient single-aisle aircraft, the A320neo additional complexity in the preparation and Answer: We are here to support our Airbus recycled for other parts of our own company, continue growth, there are many alternatives products to our family, which is around 15 percent more eco- development of marketing campaigns. sales and marketing teams. Fleet planning is such as strategy or pricing. This would be dif- than operating bigger aircraft. nomical per seat than the aircraft we are Airlines expect more in-depth simulations more and more complex, and we need to have ficult to do with external consultants. Q: A hot topic is the current row over customers. building today, and around 6 percent more and detailed analysis during aircraft selec- a team of specialists able to communicate with Q: The development of alliances, joint ven- the European Emissions Trading System that efficient than its older competitor. Our A350 tion and negotiations. It is expected that their airline counterparts. Several of our team tures and codeshare agreements should lead came into force in January. What is Airbus’ will also bring people together on new long- aircraft will deliver on technical perfor- members used to do fleet planning for an airline to a rationalization of the fleet through better perspective on this issue? haul routes, with more comfort and wider mance because airlines have less control before joining Airbus. utilization and optimization of capacity among A: What is important is that a particular seats than are available today. In addition, our of the overall cost of operation. This is Q: Your department is currently enhancing its airline partners. What is the impact for Airbus? sector is not weakened compared to other A380 will fly with even more prestigious carri- mainly due to increasing fuel prices and support for decision making. Which changes in A: Airlines have already made huge prog- transportation sectors. We live today in a ers, bringing its stunningly quiet cabin to even lower yields. Hence, it has become para- your relationship with your customers drive this ress in yield management. Load factors are global economy, so if there are important — Philippe Gossard, vice president, fleet and more flyers. a mount to precisely evaluate the expected investment? significantly higher than 10 or 20 years ago. modifications impacting global companies, network profitability group,Airbus. incremental revenue and associated costs A: Our customers have an excellent and in- International yields remain at relatively good such as airlines or our own company, it is at both the specific market and network depth knowledge of their own numbers. Some levels. Therefore, we have to continue to important that all views are discussed for a levels. of them have even developed teams to look improve our products and demonstrate that constructive dialogue. We all want to protect In addition, the development of code- at those of their competitors. Therefore, we the combination of our products, through our planet, but this needs to be discussed tickets, better comfort and good services on shares, joint ventures, alliances and other need to equip ourselves with data and tools to fleet planning scenarios, creates value for our all together. Remember that global aviation board, which all help put the fun back into partnerships has complicated the work of have constructive discussions with our custom- customers. Today, 75 percent of world traffic only generates 2 percent of carbon dioxide flying as well as make it more accessible. Look the marketing team. To support the need ers. Worldwide, successful companies dictate is carried by the three major alliances, so we emissions, whereas the heating and cooling of at some of the services offered by various to perform specific fleet and network analy- significant efforts to acquire, digest and analyze need to be very convincing with these three buildings and cars each account for around 40 carriers. Most were not even possible in hotel sis, Airbus recently selected Sabre Airline data. Apple, BMW, 3M and Cisco are examples alliances’ partners. percent. Therefore, while we as manufacturers rooms 30 years ago. Technology made them Solutions® to provide airport data intelligence of companies with this winning strategy. Q: There is currently a movement toward are doing our part to reduce emissions, the possible. (ADI) and global demand data tools. Q: Against an external consulting firm, how concentration within the airline industry, spe- worthwhile savings are to be found elsewhere. Q: Airbus plays an active role in the Single Leading Airbus’ fleet and network profit- would you define the role of your fleet and cifically in and Europe. Does Q: Airbus recently presented its vision of European Sky ATM Research (SESAR) initia- ability group, Vice President Philippe Gossard revenue team? How do you cooperate with this present an opportunity or threat for Airbus? aviation in 2050 called The Future by Airbus. tive. What is the scope of this project? Why shares with Ascend his perspectives on such firms? A: Some new airlines pop up, some airlines What are some highlights of this study? did Airbus want to be involved in the project? Christophe Ritter is a senior partner the strategic role of his department, the A: First, through the different studies we do disappear and some airlines merge, that’s life. A: This is a long-term vision. If you go back A: Aircraft fly longer paths to their destina- for Sabre Airline Solutions. He can be partnership Airbus wants to foster with its for our customers, we build on what we learn However, merged airlines are bigger and often 40 years, a lot of technologies incorporated in tions than they did 30 years ago, often on contacted at [email protected].

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