Airbus

Airbus SAS

Entry of Saint-Martin site, Blagnac
Type	Subsidiary
Industry	Aerospace
Founded	18 December 1970 (as Airbus Industrie) 2001 (as Airbus SAS)
Founder	Roger Béteille, Felix Kracht, Henri Ziegler, Franz Josef Strauss
Headquarters	Blagnac, France
Area served	Worldwide
Key people	Fabrice Brégier (President and Chief Executive Officer) Tom Williams (Chief Operating Officer)
Products	Commercial airliners (list)
Number of employees	72,816 (2015)
Parent	Airbus Group
Subsidiaries	Airbus Corporate Jets Airbus Operations S.A.S. Airbus ProSky Stelia Aerospace
Website	www.airbus.com

Airbus SAS (/ˈɛərbʌs/, French: [ɛʁbys], German: [ˈɛːɐbʊs], Spanish: [ˈeirβus]) is a division of the multinational Airbus Group SE that manufactures civil aircraft. It is based in Blagnac, France, a suburb of Toulouse,^[1][2] with production and manufacturing facilities mainly in France, Germany, Spain, China, United Kingdom and the United States. The company employs 72,816.^[3]

Airbus began as a consortium of aerospace manufacturers, Airbus Industrie. Consolidation of European defence and aerospace companies in 1999 and 2000 allowed the establishment of a simplified joint-stock company in 2001, owned by the European Aeronautic Defence and Space Company (EADS) (80%) and BAE Systems (20%). After a protracted sales process BAE sold its shareholding to EADS on 13 October 2006.^[4]

Airbus has sixteen key sites in four countries: France, Germany, Spain and the United Kingdom. Final assembly production is based at Toulouse, France; Hamburg, Germany; Seville, Spain, Tianjin, China, and Mobile, United States.^[5] Airbus has subsidiaries in the United States, Japan and India.

The company produces and markets the first commercially viable digital fly-by-wire airliner, the Airbus A320,^[6][7] and the world's largest passenger airliner, the A380. The 10,000th aircraft, an A350, was delivered to Singapore Airlines on 14 October 2016 ; the global Airbus fleet having performed more than 110 million flights over 215 billion kilometres, carrying 12 billion passengers.^[8]

History

Origins

Airbus Industrie began as a consortium of European aviation firms formed to compete with American companies such as Boeing, McDonnell Douglas, and Lockheed.^[9]

While many European aircraft were innovative, even the most successful had small production runs.^[10] In 1991, Jean Pierson, then CEO and Managing Director of Airbus Industrie, described a number of factors which explained the dominant position of American aircraft manufacturers: the land mass of the United States made air transport the favoured mode of travel; a 1942 Anglo-American agreement entrusted transport aircraft production to the US; and World War II had left America with "a profitable, vigorous, powerful and structured aeronautical industry."^[10]

In the mid-1960s, tentative negotiations commenced regarding a European collaborative approach. Individual aircraft companies had already envisioned such a requirement; in 1959 Hawker Siddeley had advertised an "Airbus" version of the Armstrong Whitworth AW.660 Argosy,^[12] which would "be able to lift as many as 126 passengers on ultra short routes at a direct operating cost of 2d. per seat mile."^[13] However, European aircraft manufacturers were aware of the risks of such a development and began to accept, along with their governments, that collaboration was required to develop such an aircraft and to compete with the more powerful US manufacturers. At the 1965 Paris Air Show major European airlines informally discussed their requirements for a new "airbus" capable of transporting 100 or more passengers over short to medium distances at a low cost.^[11] The same year Hawker Siddeley (at the urging of the UK government) teamed with Breguet and Nord to study airbus designs. The Hawker Siddeley/Breguet/Nord group's HBN 100 became the basis for the continuation of the project. By 1966 the partners were Sud Aviation, later Aérospatiale (France), Arbeitsgemeinschaft Airbus, later Deutsche Airbus (West Germany) and Hawker Siddeley (UK).^[11] A request for funding was made to the three governments in October 1966.^[11] On 25 July 1967 the three governments agreed to proceed with the proposal.

In the two years following this agreement, both the British and French governments expressed doubts about the project. The MoU had stated that 75 orders must be achieved by 31 July 1968. The French government threatened to withdraw from the project due to the concern over funding development of the Airbus A300, Concorde and the Dassault Mercure concurrently, but was persuaded otherwise.^[14] With concerns at proposal of the A300B proposal in December 1968, and fearing it would not recoup its investment due to lack of sales, the British government withdrew on 10 April 1969.^[11][15] West Germany took this opportunity to increase its share of the project to 50%.^[14] Given the participation by Hawker Siddeley up to that point, France and West Germany were reluctant to take over its wing design. Thus the British company was allowed to continue as a privileged subcontractor.^[10] Hawker Siddeley invested GB£35 million in tooling and, requiring more capital, received a GB£35 million loan from the West German government.^[14]

Formation of Airbus Industrie

Airbus Industrie was formally established as a Groupement d'Intérêt Économique (Economic Interest Group or GIE) on 18 December 1970.^[14] It had been formed by a government initiative between France, West Germany and the UK that originated in 1967. Its initial shareholders were the French company Aérospatiale and the West German company Deutsche Airbus, each owning a 50% share. The name "Airbus" was taken from a non-proprietary term used by the airline industry in the 1960s to refer to a commercial aircraft of a certain size and range, for this term was acceptable to the French linguistically. Aérospatiale and Deutsche Airbus each took a 36.5% share of production work, Hawker Siddeley 20% and the Dutch company Fokker-VFW 7%.^[11] Each company would deliver its sections as fully equipped, ready-to-fly items. In October 1971 the Spanish company CASA acquired a 4.2% share of Airbus Industrie, with Aérospatiale and Deutsche Airbus reducing their stakes to 47.9%.^[11] In January 1979 British Aerospace, which had absorbed Hawker Siddeley in 1977, acquired a 20% share of Airbus Industrie.^[16] The majority shareholders reduced their shares to 37.9%, while CASA retained its 4.2%.^[17]

Development of the Airbus A300

The Airbus A300 was to be the first aircraft to be developed, manufactured and marketed by Airbus. By early 1967 the "A300" label began to be applied to a proposed 320 seat, twin engined airliner.^[11] Following the 1967 tri-government agreement, Roger Béteille was appointed technical director of the A300 development project.^[18] Béteille developed a division of labour which would be the basis of Airbus' production for years to come: France would manufacture the cockpit, flight control and the lower centre section of the fuselage; Hawker Siddeley, whose Trident technology had impressed him, was to manufacture the wings;^[19] West Germany should make the forward and rear fuselage sections, as well as the upper centre section; the Dutch would make the flaps and spoilers; finally Spain (yet to become a full partner) would make the horizontal tailplane.^[18] On 26 September 1967 the West German, French and British governments signed a Memorandum of Understanding in London which allowed continued development studies. This also confirmed Sud Aviation as the "lead company", that France and the UK would each have a 37.5% work share with West Germany taking 25%, and that Rolls-Royce would manufacture the engines.^[10][18]

In the face of lukewarm support from airlines for a 300+ seat Airbus A300, the partners submitted the A250 proposal, later becoming the A300B, a 250-seat airliner powered by pre-existing engines.^[11] This dramatically reduced development costs, as the Rolls-Royce RB207 to be used in the A300 represented a large proportion of the costs. The RB207 had also suffered difficulties and delays, since Rolls-Royce was concentrating its efforts on the development of another jet engine, the RB211, for the Lockheed L-1011^[14] and Rolls-Royce entering into administration due to bankruptcy in 1971.^[20][21] The A300B was smaller but lighter and more economical than its three-engined American rivals.^[22][23]

In 1972, the A300 made its maiden flight; its first production model, the A300B2, entered service in 1974.^[24] However, the launch of the A300 was largely overshadowed by the similarly timed supersonic aircraft Concorde.^[25] Initially the success of the consortium was poor,^[26] but orders for the aircraft picked up,^[27][28] due in part to the marketing skills used by Airbus CEO Bernard Lathière, targeting airlines in America and Asia.^[29] By 1979 the consortium had 256 orders for A300,^[25] and Airbus had launched a more advanced aircraft, the A310, in the previous year.^[17] It was the launch of the A320 in 1987 that guaranteed the status of Airbus as a major player in the aircraft market^[30] – the aircraft had over 400 orders before it first flew, compared to 15 for the A300 in 1972.

Transition to Airbus SAS

The retention of production and engineering assets by the partner companies in effect made Airbus Industrie a sales and marketing company.^[31] This arrangement led to inefficiencies due to the inherent conflicts of interest that the four partner companies faced; they were both GIE shareholders of, and subcontractors to, the consortium. The companies collaborated on development of the Airbus range, but guarded the financial details of their own production activities and sought to maximise the transfer prices of their sub-assemblies.^[32] It was becoming clear that Airbus was no longer a temporary collaboration to produce a single plane as per its original mission statement, it had become a long term brand for the development of further aircraft. By the late 1980s work had begun on a pair of new medium-sized aircraft, the biggest to be produced at this point under the Airbus name, the Airbus A330 and the Airbus A340.^[33][34] In the early 1990s the then Airbus CEO Jean Pierson argued that the GIE should be abandoned and Airbus established as a conventional company.^[35] However, the difficulties of integrating and valuing the assets of four companies, as well as legal issues, delayed the initiative. In December 1998, when it was reported that British Aerospace and DASA were close to merging,^[36] Aérospatiale paralysed negotiations on the Airbus conversion; the French company feared the combined BAe/DASA, which would own 57.9% of Airbus, would dominate the company and it insisted on a 50/50 split.^[37] However, the issue was resolved in January 1999 when BAe abandoned talks with DASA in favour of merging with Marconi Electronic Systems to become BAE Systems.^[38][39][40] Then in 2000 three of the four partner companies (DaimlerChrysler Aerospace, successor to Deutsche Airbus; Aérospatiale-Matra, successor to Sud-Aviation; and CASA) merged to form EADS, simplifying the process. EADS now owned Airbus France, Airbus Deutschland and Airbus España, and thus 80% of Airbus Industrie.^[32][41] BAE Systems and EADS transferred their production assets to the new company, Airbus SAS, in return for shareholdings in that company.^[32][42]

Development of the A380

In mid-1988 a group of Airbus engineers led by Jean Roeder began working in secret on the development of an ultra-high-capacity airliner (UHCA), both to complete its own range of products and to break the dominance that Boeing had enjoyed in this market segment since the early 1970s with its 747.^[43] The project was announced at the 1990 Farnborough Air Show, with the stated goal of 15% lower operating costs than the 747-400.^[44] Airbus organised four teams of designers, one from each of its partners (Aérospatiale, DaimlerChrysler Aerospace, British Aerospace, CASA) to propose new technologies for its future aircraft designs. In June 1994 Airbus began developing its own very large airliner, then designated as A3XX.^[25][45][46] Airbus considered several designs, including an odd side-by-side combination of two fuselages from the Airbus A340, which was Airbus's largest jet at the time.^[47] Airbus refined its design, targeting a 15% to 20% reduction in operating costs over the existing Boeing 747–400. The A3XX design converged on a double-decker layout that provided more passenger volume than a traditional single-deck design.

Five A380s were built for testing and demonstration purposes.^[48] The first A380 was unveiled at a ceremony in Toulouse on 18 January 2005, and its maiden flight took place on 27 April 2005. After successfully landing three hours and 54 minutes later, chief test pilot Jacques Rosay said flying the A380 had been "like handling a bicycle".^[49] On 1 December 2005, the A380 achieved its maximum design speed of Mach 0.96.^[48] On 10 January 2006, the A380 made its first transatlantic flight to Medellín in Colombia.^[50]

The Airbus A380 was delayed in October 2006 due to the use of incompatible software used to design the aircraft. Primarily, the Toulouse assembly plant used the latest version 5 of CATIA (made by Dassault), while the design centre at the Hamburg factory were using the older and incompatible version 4.^[51] The result was that the 530 km of cables wiring throughout the aircraft had to be completely redesigned.^[52] Although no orders had been cancelled, Airbus still had to pay millions in late-delivery penalties.^[51]

The first aircraft delivered was to Singapore Airlines on 15 October 2007 and entered service on 25 October 2007 with an inaugural flight between Singapore and Sydney.^[53][54] Two months later Singapore Airlines CEO Chew Choong Seng said that the A380 was performing better than both the airline and Airbus had anticipated, burning 20% less fuel per passenger than the airline's existing 747-400 fleet.^[55] Emirates was the second airline to take delivery of the A380 on 28 July 2008 and started flights between Dubai and New York^[56] on 1 August 2008.^[57] Qantas followed on 19 September 2008, starting flights between Melbourne and Los Angeles on 20 October 2008.^[58]

Expansion and sale of BAE stake

In 2003, Airbus and the Kaskol Group created an Airbus Engineering centre in Russia, which started with 30 engineers and since has emerged as a model of success for Airbus’ globalisation strategy. It was the first engineering facility to open in Europe outside the company’s home countries. Equipped with state-of-the-art communications equipment and linked with Airbus engineering sites in France and Germany, the facility performs extensive work in disciplines such as fuselage structure, stress, system installation and design. In 2011, the centre employs some 200 engineers who have completed over 30 large-scale projects for the A320, the A330/A340 and the A380 programmes. Russian engineers also performed more than half of all design work on the A330-200F freighter, with its activity related to fuselage structure design, floor grids installation and junctions design. The centre currently is involved in the A320neo Sharklets design development and numerous design works for the A350 XWB programme.^[59]

Structural evolution of Airbus Group
	10 July 2000	1 December 2006	1 April 2009	17 September 2010	17 January 2014	27 May 2015
Aérospatiale-Matra, DASA CASA	European Aeronautic Defence and Space Company NV				Airbus Group NV	Airbus Group SE
	Airbus
			Airbus Military		Airbus Defence and Space
	EADS Defence and Security			Cassidian
Matra Marconi Space, DASA, CRISA	Astrium	EADS Astrium
	Eurocopter Group				Airbus Helicopters

On 6 April 2006 BAE Systems planned to sell its 20% share in Airbus, then "conservatively valued" at €3.5 billion (US$4.17 billion).^[60] Analysts suggested the move to make partnerships with U.S. firms more feasible, in both financial and political terms.^[61] BAE originally sought to agree on a price with EADS through an informal process. Due to lengthy negotiations and disagreements over price, BAE exercised its put option which saw investment bank Rothschild appointed to give an independent valuation.

In June 2006 Airbus was embroiled in significant international controversy over an announcement of further delays in the delivery of its A380. Following the announcement the value of associated stock plunged by up to 25% in a matter of days, although it soon recovered afterwards. Allegations of insider trading on the part of Noël Forgeard, CEO of EADS, its majority corporate parent, promptly followed. The loss of associated value was of grave concern to BAE, press described a "furious row" between BAE and EADS, with BAE believing the announcement was designed to depress the value of its share.^[62] A French shareholder group filed a class action lawsuit against EADS for failing to inform investors of the financial implications of the A380 delays while airlines awaiting deliveries demanded compensation.^[63] As a result, EADS chief Noël Forgeard and Airbus CEO Gustav Humbert resigned on 2 July 2006.^[64]

On 2 July 2006 Rothschild valued BAE's stake at £1.9 billion (€2.75 billion), well below the expectation of BAE, analysts, and even EADS.^[65] On 5 July BAE appointed independent auditors to investigate how the value of its share of Airbus had fallen from the original estimates to the Rothschild valuation; however in September 2006 BAE agreed to the sale of its stake in Airbus to EADS for £1.87 billion (€2.75 billion, $3.53 billion), pending BAE shareholder approval.^[66] On 4 October shareholders voted in favour of the sale,^[67] leaving Airbus entirely owned by EADS.

2007 restructuring

On 9 October 2006 Christian Streiff, Humbert's successor, resigned due to differences with parent company EADS over the amount of independence he would be granted in implementing his reorganisation plan for Airbus.^[68] He was succeeded by EADS co-CEO Louis Gallois, bringing Airbus under more direct control of its parent company.

On 28 February 2007, CEO Louis Gallois announced the company's restructuring plans. Entitled Power⁸, the plan would see 10,000 jobs cut over four years; 4,300 in France, 3,700 in Germany, 1,600 in the UK and 400 in Spain. 5,000 of the 10,000 would be at subcontractors. Plants at Saint Nazaire, Varel and Laupheim face sell off or closure, while Meaulte, Nordenham and Filton are "open to investors".^[69] As of 16 September 2008 the Laupheim plant has been sold to a Thales-Diehl consortium to form Diehl Aerospace and while the design activities at Filton have been retained, the manufacturing operations have been sold to British company GKN.^[70] The announcements resulted in Airbus unions in France and Germany threatening strike action.^[71]

2011 A320neo record orders

At the 2011 Paris Air Show, Airbus received total orders valued at about $72.2 billion for 730 aircraft, representing a new record in the civil aviation industry. The A320neo ("new engine option") model, announced in December 2010, received 667 orders; this, together with previous orders, resulted in a total of 1029 orders within six months of launch date, creating another industry record.^[72]

Corporate affairs

The subsidiary Airbus Middle East is headquartered in the Dubai Airport Free Zone.^[73] This subsidiary opened in 2006.^[74]

The subsidiary Airbus Japan K.K. (エアバス・ジャパン株式会社) is headquartered in the Roppongi Hills Mori Tower in Roppongi, Minato, Tokyo.^[75]

Civilian products

The Airbus product line started with the A300, the world's first twin-aisle, twin-engined aircraft. A shorter, re-winged, re-engined variant of the A300 is known as the A310. Building on its success, Airbus launched the A320, particularly notable for being the first commercial jet to utilise a fly-by-wire control system. The A320 has been, and continues to be, a great commercial success. The A318 and A319 are shorter derivatives with some of the latter under construction for the corporate business jet market as Airbus Corporate Jets. A stretched version is known as the A321. The A320 family's primary competitor is the Boeing 737 family.^[76]

The longer-range widebody products, the twin-jet A330 and the four-engine A340, have efficient wings, enhanced by winglets. The Airbus A340-500 has an operating range of 16,700 kilometres (9,000 nmi), the second longest range of any commercial jet after the Boeing 777-200LR (range of 17,446 km or 9,420 nautical miles).^[77] All Airbus aircraft developed since then have cockpit systems similar to the A320, making it easier to train crew. Production of the four-engine A340 was ended in 2011 due to lack of sales compared to its twin-engine counterparts, such as the Boeing 777.^[78]

Airbus is studying a replacement for the A320 series, tentatively dubbed NSR, for "New Short-Range aircraft".^[79][80] Those studies indicated a maximum fuel efficiency gain of 9–10% for the NSR. Airbus however opted to enhance the existing A320 design using new winglets and working on aerodynamical improvements.^[81] This "A320 Enhanced" should have a fuel efficiency improvement of around 4–5%, shifting the launch of an A320 replacement to 2017–2018.

On 24 September 2009 the COO Fabrice Bregier stated to Le Figaro that the company would need from €800 million to €1 billion over six years to develop the new aircraft generation and preserve the company technological lead from new competitors like C919,^[82] scheduled to operate by 2015–2020.^[83]

In July 2007, Airbus delivered its last A300 to FedEx, marking the end of the A300/A310 production line. Airbus intends to relocate Toulouse A320 final assembly activity to Hamburg, and A350/A380 production in the opposite direction as part of its Power8 organisation plan begun under ex-CEO Christian Streiff.^[84]

Airbus supplied replacement parts and service for Concorde until its retirement in 2003.^[85][86]

Product list and details (date information from Airbus)

Aircraft	Description	Seats	Max	1st flight	Production ceased
A300	2 engines, twin aisle	228–254	361	1972-10-28	2007-03-27 (561 built)
A310	2 engines, twin aisle, modified A300	187	279	1982-04-03	2007-03-27 (255 built)
A318	2 engines, single aisle, shortened 6.17 m from A320	107	132	2002-01-15
A319	2 engines, single aisle, shortened 3.77 m from A320	124	156	1995-08-25
A320	2 engines, single aisle	150	180	1987-02-22
A321	2 engines, single aisle, lengthened 6.94 m from A320	185	236	1993-03-11
A330	2 engines, twin aisle	246-300	406–440	1992-11-02
A340	4 engines, twin aisle	239–380	380-440	1991-10-25	2008-09 (A340-200) 2011-11-10 (all other variants, 377 built)[78]
A350	2 engines, twin aisle	270–350	550	2013-06-14
A380	4 engines, double deck, twin aisle	555	853	2005-04-27

The Airbus Corporate Jets markets and modifies new aircraft for private and corporate customers. It has a model range that parallels the commercial aircraft offered by the company, ranging from the A318 Elite to the double-deck Airbus A380 Prestige. Following the entry of the 737 based Boeing Business Jet, Airbus joined the business jet market with the A319 Corporate Jet in 1997. Although the term Airbus Corporate jet was initially used only for the A319CJ, it is now often used for all models, including the VIP widebodies. As of December 2008, 121 corporate and private jets are operating, 164 aircraft have been ordered, including an A380 Prestige and 107 A320 family Corporate Jet.^[87]

Consumer products

In June 2013, Airbus announced that it was developing a range of "smart suitcases" known as Bag2Go for air travellers, in conjunction with luggage-maker Rimowa and IT firm T-Systems.^[88][89] The cases feature a collection of built-in electronic gadgets which communicate with a smartphone app and with the IT systems of the airline, to assist the traveller and improve reliability and security of baggage handling. Gadgets include a weighing scale and a location tracker, using GPS for location-tracking, RFID for identification, and a SIM card for messaging.^[90][91] Since then, similar products, with more gadgets, have been announced by Delsey and Bluesmart.

Military products

In the late 1990s Airbus became increasingly interested in developing and selling to the military aviation market. It embarked on two main fields of development: aerial refuelling with the Airbus A310 MRTT (Multi-Role Tanker Transport) and the Airbus A330 MRTT, and tactical airlift with the A400M.

In January 1999 Airbus established a separate company, Airbus Military SAS, to undertake development and production of a turboprop-powered tactical transport aircraft, the Airbus Military A400M.^[92][93] The A400M is being developed by several NATO members, Belgium, France, Germany, Luxembourg, Spain, Turkey, and the UK, as an alternative to relying on foreign aircraft for tactical airlift capacity, such as the Ukrainian Antonov An-124^[94] and the American C-130 Hercules.^[95][96] The A400M project has suffered several delays;^[97][98] Airbus has threatened to cancel the development unless it receives state subsidies.^[99][100]

Pakistan placed an order for the Airbus A310 MRTT in 2008, which will be a conversion of an existing airframe as the base model A310 is no longer in production.^[101] On 25 February 2008 Airbus won an order for three air refuelling MRTT aircraft, adapted from A330 passenger jets, from the United Arab Emirates.^[102] On 1 March 2008 a consortium of Airbus and Northrop Grumman had won a $35 billion contract to build the new in-flight refuelling aircraft KC-45A, a US built version of the MRTT, for the USAF.^[103] The decision drew a formal complaint from Boeing,^[104][105] and the KC-X contract was cancelled to begin bidding afresh.^[106][107]

New supersonic passenger plane

In September 2014, Aerion partnered with Airbus (mainly Airbus Defence)^[108] to collaborate on designing the Aerion AS2, a supersonic 11-seater private business jet, hoping for a market entry in 2021.^[109]

Orders and deliveries

Aircraft	Orders	Deliveries	In operation	Unfilled
A300	561	561	243	—
A310	255	255	98	—
A320*	7,973	7,265	6,950	708
A320neo*	4,818	32	32	4,786
A330*	1,447	1,303	1,277	144
A330neo*	186	—	—	186
A340*	377	377	292	—
A350	810	45	45	765
A380	319	198	198	121
Totals	16,746	10,036	9,135	6,710

* All models included.

Data as of 31 October 2016.^[110]

Competition with Boeing

Airbus is in tight competition with Boeing every year for aircraft orders although Airbus has secured over 50% of aircraft orders in the decade since 2003.^[113]

Airbus won a greater share of orders in 2003 and 2004. In 2005, Airbus achieved 1111 (1055 net) orders,^[114] compared to 1029 (net of 1002) for the same year at rival Boeing^[115] However, Boeing won 55% of 2005 orders proportioned by value; and in the following year Boeing won more orders by both measures. Airbus in 2006 achieved its second best year ever in its entire 35-year history in terms of the number of orders it received, 824, second only to the previous year.^[116] Airbus plans to increase production of A320 airliners to reach 40 per month by 2012, at a time when Boeing is increasing monthly 737 production from 31.5 to 35 per month.^[117]

Regarding operational aircraft, there were 7,264 Airbus aircraft operational at April 2013.^[113] Although Airbus secured over 50% of aircraft orders in the decade since 2003, the number of Boeing aircraft still in operation at April 2013 still exceeded Airbus by 21% because Airbus made a late entry into the market, 1972 vs. 1958 for Boeing; this lead is diminishing as older aircraft are progressively retired.

Though both manufacturers have a broad product range in various segments from single-aisle to wide-body, their aircraft do not always compete head-to-head. Instead they respond with models slightly smaller or bigger than the other in order to plug any holes in demand and achieve a better edge. The A380, for example, is designed to be larger than the 747. The A350XWB competes with the high end of the 787 and the low end of the 777. The A320 is bigger than the 737-700 but smaller than the 737–800. The A321 is bigger than the 737–900 but smaller than the previous 757-200. Airlines see this as a benefit since they get a more complete product range from 100 seats to 500 seats than if both companies offered identical aircraft.

In recent years the Boeing 777 has outsold its Airbus counterparts, which include the A340 family as well as the A330-300. The smaller A330-200 competes with the 767, outselling its Boeing counterpart in recent years. The A380 is anticipated to further reduce sales of the Boeing 747, gaining Airbus a share of the market in very large aircraft, though frequent delays in the A380 programme have caused several customers to consider the refreshed 747–8.^[118] Airbus has also proposed the A350 XWB to compete with the Boeing 787 Dreamliner, after being under great pressure from airlines to produce a competing model.^[119][120]

Airbus will open a R&D center and venture capital fund in Silicon Valley.^[121][122] Airbus CEO Fabrice Bregier stated: "What is the weakness of a big group like Airbus when we talk about innovation? We believe that we have better ideas than the rest of the world. We believe that we know because we control the technologies and platforms. The world has shown us in the car industry, the space industry and the hi-tech industry that this is not true. And we need to be open to others' ideas and others' innovations,"^[123]

Airbus Group CEO Tom Enders stated that "The only way to do it for big companies is really to create spaces outside of the main business where we allow and where we incentivize experimentation... That is what we have started to do but there is no manual... It is a little bit of trial and error. We all feel challenged by what the Internet companies are doing."^[124]

Subsidy conflicts

Boeing has continually protested over "launch aid" and other forms of government aid to Airbus, while Airbus has argued that Boeing receives illegal subsidies through military and research contracts and tax breaks.^[125]

In July 2004 former Boeing CEO Harry Stonecipher accused Airbus of abusing a 1992 bilateral EU-US agreement providing for disciplines for large civil aircraft support from governments. Airbus is given reimbursable launch investment (RLI), called "launch aid" by the US, from European governments with the money being paid back with interest plus indefinite royalties, but only if the aircraft is a commercial success.^[126] Airbus contends that this system is fully compliant with the 1992 agreement and WTO rules. The agreement allows up to 33 per cent of the programme cost to be met through government loans which are to be fully repaid within 17 years with interest and royalties. These loans are held at a minimum interest rate equal to the cost of government borrowing plus 0.25%, which would be below market rates available to Airbus without government support.^[127] Airbus claims that since the signature of the EU-US agreement in 1992, it has repaid European governments more than U.S.$6.7 billion and that this is 40% more than it has received.

Airbus argues that the military contracts awarded to Boeing, the second largest U.S. defence contractor, are in effect a form of subsidy, such as the controversy surrounding the Boeing KC-767 military contracting arrangements. The significant U.S. government support of technology development via NASA also provides significant support to Boeing, as do the large tax breaks offered to Boeing, which some people claim are in violation of the 1992 agreement and WTO rules. In its recent products such as the 787, Boeing has also been offered direct financial support from local and state governments.^[128]

In January 2005 the European Union and United States trade representatives, Peter Mandelson and Robert Zoellick respectively, agreed to talks aimed at resolving the increasing tensions.^[129][130] These talks were not successful with the dispute becoming more acrimonious rather than approaching a settlement.^[131]

WTO ruled in August 2010 and in May 2011 that Airbus had received improper government subsidies through loans with below market rates from several European countries.^[132] In a separate ruling in February 2011, WTO found that Boeing had received local and federal aid in violation of WTO rules.^[133]

International manufacturing presence

The main Airbus factory in Blagnac is located next to Toulouse-Blagnac Airport. (43°36′44″N 1°21′47″E / 43.61222°N 1.36306°E / 43.61222; 1.36306)

Main Airbus factory in Hamburg, Germany

Main Airbus factory in Getafe, Madrid, Spain

Airbus has several final assembly lines for different models and markets. These are:

• Toulouse, France (A320, A330 family, A350 family and A380)
• Hamburg, Germany (A318, A319 and A321)
• Seville, Spain (A400M)
• Tianjin, China (A319 and A320).
• Mobile, Alabama, USA (A319, A320 and A321)

Airbus, however, has a number of other plants in different European locations, reflecting its foundation as a consortium. An original solution to the problem of moving aircraft parts between the different factories and the assembly plants is the use of the Airbus Beluga, a modified cargo aircraft capable of carrying entire sections of fuselage. This solution has also been investigated by Boeing, which retrofitted 4 747-400s to transport the components of the 787. An exception to this scheme is the A380, whose fuselage and wings are too large^[134] for sections to be carried by the Beluga. Large A380 parts are brought by ship to Bordeaux, and then transported to the Toulouse assembly plant by the Itinéraire à Grand Gabarit, a specially enlarged waterway and road route.

Airbus opened an assembly plant in Tianjin, People's Republic of China for its A320 series airliners in 2009.^{[135][136][137]} Airbus started constructing a $350 million component manufacturing plant in Harbin, China in July 2009, which will employ 1,000 people.^{[138][139][140]} Scheduled to be operated by the end of 2010, the 30,000 square metre plant will manufacture composite parts and assemble composite work-packages for the A350 XWB, A320 families and future Airbus programmes. Harbin Aircraft Industry Group Corporation, Hafei Aviation Industry Company Ltd, AviChina Industry & Technology Company and other Chinese partners hold the 80% stake of the plant while Airbus control the remaining 20%.^[141]

North America is an important region to Airbus in terms of both aircraft sales and suppliers. 2,000 of the total of approximately 5,300 Airbus jetliners sold by Airbus around the world, representing every aircraft in its product line from the 107-seat A318 to the 565-passenger A380, are ordered by North American customers. According to Airbus, US contractors, supporting an estimated 120,000 jobs, earned an estimated $5.5 billion (2003) worth of business. For example, one version of the A380 has 51% American content in terms of work share value.

Plans for a Mobile, Alabama aircraft assembly plant were unveiled by Airbus CEO Fabrice Brégier from the Mobile Convention Centre on 2 July 2012. The plans include a $600 million factory at the Mobile Aeroplex at Brookley for the assembly of the A319, A320 and A321 aircraft. It could employ up to 1,000 full-time workers when operational. Construction began on 8 April 2013, and became operable by 2015,^[142] producing up to 50 aircraft per year by 2017.^[143][144]

2016 deal with Iran

In January 2016 Airbus announced it has signed a tentative agreement with Iran to sell 118 Airbus aircraft along with a comprehensive civil aviation cooperation package to Iran. The agreement was part of the implementation of JCPOA (Joint Comprehensive Plan of Action).^[145] Boeing has also announced its will to sell 80 jets directly to Iran Air as part of a proposed deal worth up to $17.6bn.^[146] However, In early July 2016, US House of Representatives passed amendments that would block Department of Treasury funds from granting licences for export or reexport of passenger commercial aircraft. Boeing reacted that if its deal with Iran is blocked by the US Congress, all other companies that supply to its rivals should be prohibited as well. Airbus, too, has said that it requires US's approval to export airliners to Iran, because parts of its aircraft are made in the US.^[147]

Environmental record

Airbus has committed to the "Flightpath 2050", an aviation industry plan to reduce noise, CO₂, and NOx emissions.^[148]

Airbus was the first aerospace business to become ISO 14001 certified, in January 2007; this is a broader certification covering the whole organisation, not just the aircraft it produces.^[149]

Biofuel

Airbus has joined Honeywell and JetBlue in an effort to reduce pollution and dependence on oil. They are trying to develop a biofuel that could be used by 2030. The companies propose supplying almost one third of the world's aeroplane fuel needs without affecting food resources. Algae is viewed as a possible alternative energy source because it absorbs carbon dioxide during its growth, and because its use will not affect food production. However, algae and other vegetation-based fuels are still just experiments, and fuel-bearing algae has been expensive to develop.^[150] Airbus recently operated the first alternative fuel flight on a mixture of 60% kerosene and 40% gas to liquids (GTL) fuel in one engine. It did not cut carbon emissions, but it was free of sulphur emissions.^[151] Alternative fuel was able to work properly in Airbus' aeroplane engine, demonstrating that alternative fuels should not require new aeroplane engines. This flight and the company's long term efforts are considered big strides towards environmentally friendly aeroplanes.^[151]

Export credits

According to Patrick Crawford of the UK Export Finance, "Historically, the three European Export Credit Agencies that support Airbus have covered about 17% of that company's total sales. In 2009–10, reflecting the increased constraints on bank liquidity across the world, that proportion rose to 33%. ECGD guarantees represented by Airbus deliveries grew to 90% of the value of business underwritten and 83% of numbers of facilities. Nearly 50% of these Airbus deliveries were powered by UK aero-engines (supplied by either Rolls-Royce or IAE)." ^[152]

Airbus aircraft numbering system

The Airbus numbering system is an alpha numeric model number followed by a dash and a three digit number.^[153]

The model number often takes the form of the letter "A" followed by a '3', a digit, then followed normally by a '0', for example A330. There are some exceptions such as: A318, A319, A321 and A400M. The succeeding three digit number represents the aircraft series, the engine manufacturer and engine version number respectively. To use an A320-200 with International Aero Engines (IAE) V2500-A1 engines as an example; The code is 2 for series 200, 3 for IAE and engine version 1, thus the aircraft number is A320-231.

An additional letter is sometimes used. These include, 'C' for a combi version (passenger/freighter), 'F' for a freighter model, 'R' for the long range model, and 'X' for the enhanced model.

Engine codes

Code	Manufacturing company
0	General Electric (GE)
1	CFM International (GE and SNECMA)
2	Pratt & Whitney (P&W)
3	International Aero Engines (P&W, RR, MTU, Kawasaki, Mitsubishi, and IHI)
4	Rolls-Royce (R-R)
5	CFM International (GE and SNECMA) (CFM International LEAP-1A for A320 NEO Family)
6	Engine Alliance (GE and P&W)
7	Pratt & Whitney (P&W) (Pratt & Whitney PW1100G for A320 NEO)

See also

• Aerospace industry in the United Kingdom
• Airbus affair – ongoing controversy over Air Canada deal
• Boeing
• Bombardier Aerospace
• Comac
• Competition between Airbus and Boeing
• Embraer
• Stelia Aerospace
• Thor – World's first 3D-printed aircraft
• United Aircraft Corporation

References

Bibliography

• Congressional Research Service (1992). Airbus Industrie: An Economic and Trade Perspective. U.S. Library of Congress. 
• Heppenheimer, T.A. (1995). Turbulent Skies: The History of Commercial Aviation. John Wiley. ISBN 0-471-19694-0. 
• Lynn, Matthew (1997). Birds of Prey: Boeing vs. Airbus, a Battle for the Skies. Four Walls Eight Windows. ISBN 1-56858-107-6. 
• McGuire, Steven (1997). Airbus Industrie: Conflict and Cooperation in U.S.E.C. Trade Relations. St. Martin's Press. 
• McIntyre, Ian (1982). Dogfight: The Transatlantic Battle Over Airbus. Praeger Publishers. ISBN 0-275-94278-3. 
• Thornton, David Weldon (1995). Airbus Industrie: The Politics of an International Industrial Collaboration. St. Martin's Press. ISBN 0-312-12441-4. 

External links

Wikimedia Commons has media related to Airbus.

• Official Airbus website
• Airbus North America
• Yahoo! – Airbus SAS company profile
• Airbus on Twitter
  
• Case study of the Airbus Higher Apprenticeship

Key Airbus publications

• Airbus Orders & Deliveries 1974 – February 2008 (xls)