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Hard Landing: Airbus in crisis

November 5, 2021

Airbus has been plunged into crisis by the COVID pandemic. Last year, Chief Executive Officer Guillaume Faury said that the company was in danger of collapse.

https://p.dw.com/p/41Yob
Zukünftiger CEO von Airbus Guillaume Faury mit Replika des A220
Image: picture-alliance/AP Photo/F. Scheiber

He announced 15,000 job cuts and warned that recovery would be very difficult.

What Faury kept quiet was that the aircraft manufacturer was in trouble even before the pandemic started.  Corona just fanned the flames. This documentary examines Airbus’ story, a company that strives to be the most important manufacturer of civil and military airspace products in the world, but has been plagued by scandals. Does Airbus still have a future? Or is it an outdated relic from the 20th Century?

Deutschland Airbus-Werk Hamburg
Image: picture-alliance/dpa/M. Gambarini

Airbus was founded in France in 1970 and grew to become one of Europe’s boldest companies. It currently employs approximately 130,000 people worldwide, and at present it has the market lead over its biggest competitor, Boeing. Over 75 per cent of its revenues come from civil aircraft. The company is also an important manufacturer of military services and products, such as military helicopters, and builds space products, such as satellites and rockets. Its list of achievements is long. But so is its list of problems. 

10 Jahre Airbus A380
Image: em company/F.Maligne

One of these concerned the wide-body passenger aircraft, the A380. The parts for the superjumbo jet were produced in 20 different locations, and had to be shipped around Europe. Not only was delivery frequently late, but the carbon footprint was problematic. After twelve years of production, Airbus announced the A380 was being discontinued.

Deutschland Frankfurt Airbus A380 und Boeing 747
Image: Boris Roessler/dpa/picture alliance

The decision meant heavy losses for the company - and also for taxpayers. Taxpayers’ money had indirectly financed the loans paid by the EU to subsidize the development of the A380. Now that production of the aircraft was being ceased, Airbus would no longer be repaying those loans. Then there was the World Trade Organization (WTO) investigation, which found that over the years Airbus received around $22 billion of unfair subsidies paid by France, Germany, and the EU. The WTO subsequently allowed the US to impose tariffs on up to $7.5 billion worth of EU goods in 2019.

Airbus-Logo
Image: picture-alliance/dpa/C. Charisius

Not long after, in early 2020, Airbus was hit by a corruption scandal and fined 3.6 billion euros. A number of employees were accused of having paid several millions in bribes worldwide over many years to boost sales. Susan Hawley of Transparency International described corruption at Airbus as a business model and questioned whether the company was even capable of operating without corruption. Airbus was able to avert a criminal trial because judges like Dame Victoria Sharpe from the UK determined that prosecution, and thus exclusion from important markets, would ruin Airbus. Ultimately, this company was deemed too big to fail.

Broadcasting Hours: 

DW English

TUE 09.11.2021 – 01:15 UTC
TUE 09.11.2021 – 04:15 UTC
TUE 09.11.2021 – 18:15 UTC
WED 10.11.2021 – 09:15 UTC
SAT 13.11.2021 – 08:15 UTC
SUN 14.11.2021 – 12:15 UTC

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WED 10.11.2021 – 09:15 UTC
SAT 13.11.2021 – 08:15 UTC

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