The Concorde Saga|Business Strategy|Case Study|Case Studies

The Concorde Saga

            
 
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Case Details:

Case Code : BSTR084
Case Length : 13 Pages
Period : 1976 - 2003
Organization : British Airways, Air France
Pub Date : 2004
Teaching Note : Available
Countries : France, UK
Industry : Aviation

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.



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EXCERPTS

The Concorde Experience

Flying the Concorde was a unique and thrilling experience. Because it flew at a height greater than subsonic jets, people were flown to what was called 'the edge of space'. They actually flew to the edge of the stratosphere, where conditions were very different from what they were lower in the atmosphere, closer to earth.

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People who flew Concorde waxed rhapsodically about the sky, which make out the curvature of the earth and the line dividing day and night as the earth rotated. These were experiences that were normally available only to military pilots and astronauts. But the Concorde brought these 'out-of-the-world' experiences within the reach of common people. Another unique aspect of the Concorde was its speed. Passengers recounted their thrill at breaking the sound barrier and the sonic boom. The speed at which Concorde flew also transported people to their destinations twice as fast as subsonic aircraft. "Arrive before you leave" was a punch line used by Concorde.

The Problems With Concorde

Despite its many advantages, Concorde did not really catch on in a popular way. One of the important reasons for this was the exorbitant prices of Concorde tickets, which made it the exclusive privilege of the rich. A one way ticket from London to New York on the Concorde cost about $5000.

An analyst said he could fly 10 trips between the same two places for that same amount, on a subsonic aircraft. A round trip was anywhere between $ 8000 and $ 12000. The price of Concorde travel impeded its popularity, and because it was not very popular, the cost per unit remained high. It was universally accepted that Concorde was a fuel thirsty jet. It was designed in the 1960s, when there was no dearth of fuel and environmental issues had not really come into focus. However, the 1970s saw increasing tension in the oil producing countries of the Middle East. Fuel shortages and restrictions had far reaching effects on the western countries and people began realizing the importance and uncertainty of the fuel situation...

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