Airbus Strategy

Airbus Strategy

The Airbus strategy is also multilayered. One author, examining the overall strategy of the organization under the leadership of current CEO makes the following observations:

Airbus has already grown from a Franco-German joint-venture into a fully fledged European affair, with Britain and Spain as shareholders and Italy's aircraft industry a key supplier. Mr. Humbert now sees his role as taking the company a stage further, and turning it into a truly global business.

After taking over his first overseas visit was to China, where Airbus has a joint-venture-an engineering centre with a local aircraft manufacturer. The Chinese have been offered a 5% risk-bearing share of the new A350 mid-sized long-haul aircraft (A new pilot..., 2005, p. 64).

Thus, Airbus now faces the challenge of working from the European market outward. In addition to offering cooperative agreements with China, the organization is also considering the development of a new plant in the United States. All of these efforts are based on the desire of the organization to expand its current operations.

The central tenet of Airbus' expansion focuses on risk-bearing contracts in which suppliers and purchasers take some risk for the organization's decision to develop in their country. Expansion projects in both Europe and Asia require the governments of these countries to assume some risk for undertaking manufacturing operations of Airbus products. While this method helps Airbus to ensure that it will be able to bring its products to the market after they are produced, researchers have noted that in the wake of the 9/11 terrorist attacks, many of the suppliers for Airbus have cut back on their risk-sharing agreements. As a result of this process, Airbus is finding it difficult to efficiently manage its overall supply chains. If this occurs over the long-term, it could make it difficult