The big problems surrounding Airbus’ giant passenger plane, the A 380, are what led to Christian Streiff’s resignation. He had been brought in to limit the damage from a costly two-year delay to the flagship superjumbo project.
Streiff drew up a turnaround plan for Airbus. Reportedly it is strongly supported by EADS directors and indeed the company says it will go ahead with it. The plan includes cost cuts of up to two billion euros a year. One way to do that would be to reduce the number of production centres, but that would mean job cuts, which is politically problematic for the French and German governments. Airbus planes are assembled in Toulouse, France from parts made in France, Germany, Britain and Spain. Transporting those sections adds to the cost.
The delays to the A380 have undermined the airline industry’s confidence in the plane maker and will also hit its bottom line.
Some,like Emirates and Singapore, are said to be considering cancelling some orders; all will want major compensation.
The question is what effect will Streiff’s departure have on the airlines’ level of confidence in Airbus, particularly as the first thing he said after leaving the company was that it is the group’s structure that is the main reason for Airbus’ problems.
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