Airbus Drops A380 Super-Jumbo Jet

In June, 2006, I posted about the different strategies and market forecasts of Airbus vs. Boeing.

Airbus thought passengers would be flying hub to hub in giant jets like the A380. Boeing thought passengers would be flying point to point in smaller jets.

Now, more than 12 years later, Airbus has decided to discontinue its super-jumbo A380. Orders had been dropping off . . . and now Airbus will remove the 380 from its product line.

It turned out, Boeing's vision of how passengers would prefer to travel, coupled with tech advances in jet fuel economy and airline decisions, made a big difference in marketing new commercial jets.

Upcoming 12th Blogiversary

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June will mark the 12th anniversary of this blog! My very first post was about the way Boeing views the future (for strategy reasons) vs. the way competitor Airbus views the future.

At the time, I indicated a preference for Boeing's view, because it envisioned a point-to-point future for passenger flights, whereas Airbus's vision was for giant jets flying passengers from one airport hub to another.

The difference matters, because these visions of the future guide companies in planning for new products and supply-chain priorities. In turn, suppliers and buyers both consider what Boeing and Airbus think about the future of air travel and the airline industry. They factor these and other projections into their planning for marketing strategy.

In general, what Boeing envisioned in 2006 has come to pass now. As a result, there is higher demand for lighter, fuel-efficient jets than for heavy, gigantic jets like the Airbus 380.

Boeing at this moment sees air travel demand increasing from 2017-2036, according to its Current Market Outlook. In fact, it believes this will mean airlines will need to have twice as many passenger jets in service by 2036, compared with fleet sizes today.

Today, Airbus also believes that demand for air travel and air cargo will increase year after year after year, and by 2036, the company projects a need for 35,000 additional aircraft.

The competition between these rivals continues as the market expands and airlines line up new aircraft. In 2017, Airbus sold more aircraft than Boeing. However, Boeing was the leader in aircraft delivered.

Notice that the focus is on Airbus AND Boeing, because these two manufacturers are the two largest in the world.

How will their competition affect the overall market, including smaller manufacturers?

Airbus's Strategic Vision

Ten years ago, I began this blog by contrasting the long-term projections of Airbus and Boeing, and the effect on their strategic decisions. Airbus saw great potential in building a huge jet to fly 500+ passengers between hubs...Boeing saw more potential in not-so-huge jets for point-to-point flights.

On its corporate website, Airbus says this about the A380:

Designed for air transport needs in the 21st century, its unique size allows airlines to maximize their revenue potential through an optimized, segmented cabin. 

Now Airbus has learned that Singapore Airlines will not renew its ten-year lease for the gigantic A380 passenger jet. Other carriers are thinking about smaller Airbus jets instead. Filling so many seats on the A380 is one element of how airlines consider what planes to lease or buy. Fuel economy is another element. Each airline also has its own strategy for satisfying customers' needs and making a profit.

Emirates Airlines has successfully built high volume on the basis of its A380 jets. The President of Emirates tells Business Insider: "Airport congestion around the world is getting worse. And up-gauging aircraft is a solution for this." Meaning: Emirates uses A380s to fly a lot of passengers from one huge hub to another.

The double-decker configuration requires a special airport gate, which means airlines must schedule carefully. In fact, although Chicago's O'Hare has had runway capacity to fit the A380 for a few years, it has only one gate for the jumbo jet (more are in future plans).

So Airbus's strategic vision has faced turbulence in part because of infrastructure issues and in part because of how its customers plan for their customers.

What Do Companies Say About Their Mission?

Not every company has a mission statement publicly available, but most major corporations post a vision and statement of values for the world to see. Here are some samples of what big companies say about their mission, which in turn drives business strategy, marketing management, and every aspect of operations.

Procter & Gamble writes about its vision this way: Our Purpose unifies us in a common cause and growth strategy of improving more consumers’ lives in small but meaningful ways each day. It inspires P&G people to make a positive contribution every day. Our Values reflect the behaviors that shape the tone of how we work with each other and with our partners. And Our Principles articulate P&G’s unique approach to conducting work every day.

Unilever writes about its purpose and vision: Our Corporate Purpose states that to succeed requires "the highest standards of corporate behaviour towards everyone we work with, the communities we touch, and the environment on which we have an impact." Unilever is committed to supporting sustainability and providing our consumers around the world with the products they need to look good, feel good and get more out of life.

Starbucks writes about its vision: To inspire and nurture the human spirit, one person, one cup, and one neighborhood at a time. With our partners, our coffee and our customers at our core, we live these values: [culture of warmth/belonging, courage to challenge status quo, transparency and dignity, accountability]. We are performance driven, through the lens of humanity.


L.L. Bean writes about its values: The values that the company's founder, L.L. Bean, was raised to believe in were simple and deeply ingrained. Nature is something to be revered. Family ties are a priority. Being neighborly is a matter of course. And "do unto others" is not just a saying, but a way of life.

McDonald's writes about its values: Everyday all around the globe, McDonald's is putting people, processes and practices into place to make better food, more sustainable sourcing, happier people, a stronger community and a healthier planet.

PepsiCo writes about its mission: As one of the largest food and beverage companies in the world, our mission is to provide consumers around the world with delicious, affordable, convenient and complementary foods and beverages from wholesome breakfasts to healthy and fun daytime snacks and beverages to evening treats. We are committed to investing in our people, our company and the communities where we operate to help position the company for long-term, sustainable growth.

Brand Vision and Living the Brand

Here, in their own words, are the mission and core values of three major brands. Notice the emphasis on brand image/personality, as well as on connecting with customers and other stakeholders (investors and the world at large).

Staples, the office products retailer (with 1.1 million Facebook likes and 267,000 Twitter followers), says about the values of its brand:

• When you buy our brand, quality is more than expected — it’s guaranteed. We source durable materials, develop premium features and conduct rigorous tests to make affordable products you can count on. Because high quality doesn’t have to come at a high price. 

Coca-Cola (with nearly 3 million YouTube views and 176,000 Twitter followers) says its mission in the beverage segment is:

• To refresh the world...
• To inspire moments of optimism and happiness...
• To create value and make a difference.

Brother, which makes printers, sewing machines, and other items, says its corporate vision:

• places the customer first in all activities and in many ways. Moreover, the Brother Group is a company that provides good values obviously to our "existing" customers but also to potential "future" customers.
• Our goal is to ensure the customer perception that Brother is a "trustworthy brand."