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to get aircraft orders from Kuwait and, an inflated number of orders which may have caused the demise of Sabena.
Q 1) In each of the cases who benefits and who suffers from the alleged ethical and legal lapses of Airbus? In the alleged kickback scheme where Sabena's order of planes which it did not need was doubled the loser was Sabena a move which helped trigger the airline's collapse four years later p It is almost always assumed as the case study indicates that politics plays apart in the ordering of aircraft from manufacturers Lobbying for Airbus may be considered friendlier in the European nations which are part of the Airbus consortium. and that it may well think of losing out to Airbus as a sort of "insult" to America. Eventually, losers will also include the officials who were influenced, probably bribed or offered kickbacks for Airbus orders.Thus y y y Only 1 case led to conviction Airbus Benefited in India and Canada but suffered in Kuwait and Syria Boeing suffered in each case except Syrian scandal.
Q2) How should the public relations staff at Airbus respond to the articles appearing in The Economist and The Guardian? Both companies, of course, use lobbying and political influentials to help promote the sale of their aircraft. Obviously, Airbus, when the Kuwaiti official "announced a firm order for 15 Airbus aircraft worth $1`.1 billion and options for nine mo re, worth up to #9 million" (In the alleged kickback scheme, where Sabena's order of A32 planes, which it did not need, was doubled, the loser was Sabena "a move which helped trigger the airline's collapse four years later (Prove that Boeing's GE engines are more effective and efficient than Rolls Royce's used by Airbus. Also, offer a greater versatility in items such as seating, baggage and freight loads and cutting down on turn-around time. What the PR people need to do is to provide press releases, including comments from the new management team which, in essence, explains that the legal and ethical problems of the previous Airbus leadership have now been eliminated. How and why?
" Airbus sees these middlemen as "a valuable asset built up over a period of years" (It is obvious that the kickback and bribery schemes which resulted in the purchase of Airbus aircraft were approved. the Kuwaiti airline. is that Boeing is a totally American firm. One difference. while Airbus is represented by a number of European countries. Boeing can turn to outsourcing. Furthermore. of course.Q3) What steps might Boeing take to defend itself from this sort of competition? Not mentioned in the article may be the underlying anti-American bias by some nations which gives Airbus a leg up on Boeing. Boeing needs to say: when you deal with Boeing. or at least not opposed by Airbus' previous management. Airbus. To sum it up : . as the case study indicates.S. one can also state that the manipulation and schemes of Airbus also cost Boeing an order from KAC. Two immediate steps might be suggested: First. On the other hand what Boeing could do is In order to save on costs so that Boeing can provide lower prices to its customers. Q4) Do you think Boeing and Airbus behave differently in marketing their aircraft around the globe? Who gained? 2. now has clear and enforceable guidelines for the way in which solicitations for business and eventual contractual agreements are made. Outsourcings will Boeing to become more competitive. you deal only with Boeing's knowledgeable sales and technical experts. It is almost always assumed. Boeing could provide different set of value propositions like. that politics plays apart in the ordering of aircraft from manufacturers. y y y Quality aspect Higher technology aspect Better passenger capacity. No more seaside villas in Mexico or the equivalent for anyone seeking to do business with Airbus Industries from now on so. A second defence is to improve the quality and performance of the planes. the opt ion of outsourcing also allows Boeing to share risks and focus on their relationship with marketing and suppliers Also Boeing could enter into JV with foreign govt. the articles need to point out. It would not be surprising to find that Boeing uses the very nature of being considered as representing the U. the elimination of all "middlemen.
it may harm a country·s economic development. Yes. corruption in the form of black -marketeering. and yes. this pragmatic stance ignores the fact that corruption tends to corrupt both the bribe giver and the bribe taker. Airbus used bribery and Kickbacks« y y Kuwait airlines corporation Indian Airlines Q5) Had France adopted the OECD convention on bribery ahead of these transactions would the firm·s behaviour have differed? Why? Given the debate and the complexity of this issue. pulling back may be difficult if not impossible. the ethical implications of making such payments are unclear. and side payments to government bureaucrats to ´speed upµ approval for business investments may enhance welfare. payoffs to government officials in the form of speed money are a part of life. are excluded from both the Foreign Corrupt Practices Act and the OECD convention on bribery. one again m ight conclude that generalization is difficult and the demand for speed money creates a genuine ethical dilemma. corruption is bad. Several economists advocate this reasoning. smuggling.Boeing acted more responsible an dethical. . Corruption may improve efficiency and help growth! These economists theorize that in a country where pre-existing political structures distort or limit the workings of the market mechanism. but yes. Arguments such as this persuaded the U. From a pragmatic standpoint. However. or speed money. and once an individual starts down the road of corruption. might be the price that must be paid to do a greater good (assuming the investment creates jobs where none existed and assuming the practice is not illegal). Corruption feeds on itself. there are also cases where side payments to government officials can remove the bureaucratic barriers to investments that create jobs.S. suggesting that in the context of pervasive and cumbersome regulations in developing countries. no matter how compelling the benefits might seem. giving bribes. In many countries. y Followed procedure and standards to increase or promote sales. While facilitating payments. Congress to exempt facilitating payments from the Foreign Corrupt Practices Act. This argument strengthens the ethical case for never engaging in corruption.. although a little evil. One can argue that not investing because government officials demand speed money ignores th e fact that such investment can bring substantial benefits to the local populace in terms of income and jobs.