AirAsia Flight 8501 Crash Analysis

This assignment delves into the tragic crash of AirAsia Flight 8501 in 2014, requiring students to analyze the contributing factors. A key focus is on examining the decision-making processes and problem-solving strategies employed by both the crew and airline personnel leading up to the incident.

RUNNING HEAD: MBA-Decision Making & Problem Solving 1
Decision Making &
Problem Solving
Analysis of AirAsia Airline Plane 8051 Crash in 2014
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Analysis of AirAsia Airline Plane 8501 Crash in 2014 2
Contents
Introduction......................................................................................................................................2
Purpose of Report.........................................................................................................................3
Company, Problem and Approach Used to Solve...........................................................................3
Analysis...........................................................................................................................................5
Critical Evaluation of the Approach Used.......................................................................................6
Improvements Suggested in the Approach used..........................................................................6
Other Available Approaches........................................................................................................7
The Best Approach.......................................................................................................................7
Stock Market Analysis.....................................................................................................................7
Reaction of Investors to Problem and Solution...........................................................................8
Trend Analysis of Share Price during the Period.........................................................................8
Conclusions......................................................................................................................................9
Summary of Key learning Points...............................................................................................10
Recommendations..........................................................................................................................10
To company................................................................................................................................10
To readers...................................................................................................................................10

Analysis of AirAsia Airline Plane 8501 Crash in 2014 3
Introduction
The report is regarding the Indonesia AirAsia Flight 8501 (QZ8501/AWQ8501) which was
scheduled to carry passengers from Surabaya, Indonesia, to Singapore. The international
passenger flight was operated by AirAsia Group affiliate Indonesia AirAsia. The flight met with
an accident on 8 December 2014, while operating on the route, crashing into the Java Sea due to
bad weather. The incident killed all 155 passengers and seven crew on board. The debris and
human remains were collected two days later in the Java Sea. The wreckage was found on the
sea floor on 3 January 2015(ABEND, 2015). The flight data recorder and cockpit voice recorder
were recovered by 13 January. The aircraft was hindered during an unusual steep climb and had
been incapable to recuperate. On 1 December 2015, the Indonesian National Transportation
Safety Committee stated that the incidence was caused due to the sequence of events causing
crash due to malfunction in the rudder travel limiter unit. The pilots’ reply to the 104-degree roll
of the aircraft and miscommunication lead to chain of events leading loss of aircraft. The air
crash became the second-deadliest in Indonesian territory, behind Garuda Indonesia Flight 152 in
1997. It was considered as the second deadliest crash involving A320 and the third deadliest
involving an Airbus A320 family (Lab, 2015). The aircraft crash lead to series of consequences

Analysis of AirAsia Airline Plane 8501 Crash in 2014 4
generating multiple allegations on the AirAsia. It further leads to economic crash and had a long
term impact (Smith, 2015).
Purpose of Report
The report is related to examination of Air crash of Indonesia AirAsia Flight 8501
(QZ8501/AWQ8501). The incidence leads to series of impacts on the Indonesian economy. Such
incidence creates distrust in the airliner and hence creates disruption. The AirAsia incidences
lead to multiple theories against their goodwill. One of the main purposes is to examine the
consequences that lead to this event and further affected the unsettled events coming up in future.
AirAsia suffered widespread allegations due to the incidence and witnessed a series of fall in the
share market. The group is a pioneer of low -cost model in Asia, and has built a strong reputation
for affordable and safe flying. This has further questioned the credibility of AirAsia’s long
history in aviation industry. An analysis into the matter and how it affected company’s position
wherein causing a fall in the share price. It showcases the investor behavior due to the fall in the
stock market during the period. It further provides recommendations to the company and the
readers regarding the air crash. This has further greater implications on the airliner in order to
reduce such incidence (Trask, 2016).
Company, Problem and Approach Used to Solve
The air crash was known as one the second-deadliest incidence in the history of Indonesian
territory. It has affected people trust over the airliner and hampered the people’s faith for a long
time-period. The fatal crash occurred due to bad weather condition. The deadliest incident
created a deep concern in mind of people regarding the credibility of aircraft. The probable
reason behind the crash was due to the bad weather. This accident has created a concern among

Analysis of AirAsia Airline Plane 8501 Crash in 2014 5
people, whether to trust the brand or not. AirAsia is known across the world for holding minority
interest in countries like Thailand, the Philippines, India; the low cost airliner is carrying out
facilities in order to manage the operations in the cost-friendly way. Incidence like this has
questioned the credibility of the airliner and shaken the faith of people. AirAsia has flown more
than 200 Million passengers across the world, including its long haul arm AirAsia X. There has
never been an incidence regarding the lost of flight or accident. The apparent incidence caused
due to the miscommunication in between the pilot and the co-pilot due to the technical problem.
The Airbus was en-route to Singapore from Surabaya, wherein it lost the contact with air traffic
control after 42 Minutes after takeoff. Seven crew members and 155 passengers were on board.
The wreckage and bodies were later collected from the Java Sea. There were multiple theories
suggesting the reason behind the incidence. Investigators state that the Airliner lost the control of
the plane leading to accident (Otto and Pasztor, 2015). Another theory suggests that the
incidence was caused due to technical problem with the Rudder Travel Limiter; The estimated
interruption to RTL occurred around 3 times in a space of 13minutes resulting in disengagement
to auto-pilot. The loss in auto-pilot function created a miscommunication in between the pilot
and the co-pilot leading to manual fly. According to the information collected from the two
black boxes; there was a miscommunication in between the two pilots. The pilot instructed the
co-pilot to pull down which literally means sending the plane to 38,000 feet. There is a literal
misrepresentation of instructions as given by the pilot to the co-pilot (Barreveld, 2015). The
findings from the year long investigations suggest that there was no standardised terminology.
Co-pilot was initially taken control of the plane as the pilot was fixing the RTL. Further
investigations suggested that the plane faced the same issue 23 times since January 2014. The

Analysis of AirAsia Airline Plane 8501 Crash in 2014 6
problem occurred due to a cracked solder joint when exposed to extreme temperature (Koren,
2015).
The investigation detects two reasons behind the incidence resulting in plane crash. The
malfunctioning of RTL and subsequent flight crew action resulted in the accident. It was beyond
the capability of the crew to recover. The series of technical failure resulted in the incidence.
The joint investigation by Australian, French, Singaporean and Malaysian authorities has pointed
out the weakness in pilot training in dealing with such situations. It is further recommended by
the authorities that the pilots have to be given training regarding the recovery of plane (Pounian
and Green, 2015).
Analysis
From above it is clear that analysis it is clear that the It is very well clear from the scenario that
the AirAsia pilots are not given with a proper training. There were sudden changes in the market
leading to change in airliner in an effective way. This has a prolong impact on the history of
aircraft industry. This has a direct influence on the airliner and influenced the factors that were
later responsible for the ill-fate of the aircraft. It is further justified that the airliner has a direct
implication on the flight and impact the flight had on the long term sustainability (Brajawidagda,
Chatfield and Reddick, 2015). This is important enough while analysing the factors that are
associated with the incidence. This is important in order to avoid such incidences in the aviation
industry. This is important enough for handling the situation in the most effective way. More the
less, this incidence is an example of ignorance that required to be dealt with utmost care. It is
clear from that the steep fly angle in attempting to over-fly a huge thundercloud the Air Asia
plane, flying from Surabaya to Singapore in the early morning of 28 December 2014, entered the

Analysis of AirAsia Airline Plane 8501 Crash in 2014 7
thundercloud. Jet-engines stopped working without presence of oxygen. Air Asia flight QZ8501,
a twin engine Airbus 320, unfortunately flew into such a bubble of CO2 the aircraft made an
"unbelievably" steep climb, from 32,000 to 38,000 feet, possibly pushing it beyond the Airbus
A320's limit. Due to the high altitude and steep angle of climb, the plane lost control and lost the
balance. As per the research, The CO2 escaping from an unknown source in the earth’s crust
resulted in high winds at this altitude, leading the incidence (Matsuno and Ilmi, 2015).
There were sudden disturbance in the flight recorder (black box) from Flight 8501 can disprove
or otherwise validate this theory. The possible reason behind the incidence can only be
determined through the recordings. There are multiple theories one out of many possible
explanations for the accident. The crucial point to look for is the relatively sudden loss of thrust
due to failure of both engines at about 36,000 feet (Gerken, et al 2016).
There is a need to conduct an investigation into the matter like - Investigation of possible
volcanic activity in the region. This is to avoid any repeat of stalling aircraft, in case more CO2
is released.
Critical Evaluation of the Approach Used
One of the main reasons behind the incidence was due to ineffective training. This is critical for
gaining an effective insight. There were questions on the credibility of the airliner that has
affected the company. People avoided the use of Aircraft after the incidence took place. There
are situation where the critics have slammed the company for using inefficient aircrafts (Elliot,
2015).

Analysis of AirAsia Airline Plane 8501 Crash in 2014 8
Improvements Suggested in the Approach used
There are consistent issues in the airliner that required to be addressed in a well effective way.
There is a necessity to adopt a standardised training process. The pilots are not being provided
with a proper training that in return has affected the brand. Reports suggested that the Airliner
was not following any standardized guidelines that created the confusion. There is a necessity to
address the problem in a well and effective way so as to manage the problem with a correct
approach. This is important for gaining effectiveness in drawing efficiency in the best possible
way (LA Times, 2015).
Other Available Approaches
Another critical issue found in the case study is regarding the use of failed aircraft parts. The
incident could have been avoided if the RTL was repaired at an early stage. There is a constant
issue that is been faced by the airliner. Such an incidence created questions in the mind of the
travellers and the other stakeholders. It is important to repair the aircraft in order to avoid such
incidences in future.
The Best Approach
The best approach is to find out the most appropriate solution to the problem and to effectively
implement the plan in order to eliminate the repercussion of such incidence. This is important to
eliminate such incidences that might affect the company later. This is necessary for
implementing one of the most effective ways to reduce the ill-impact (Auxier, 2015; Bellamy,
2015).

Analysis of AirAsia Airline Plane 8501 Crash in 2014 9
Stock Market Analysis
After the incidence, AirAsia share price fell 7.8 percent. This was their biggest one-day drop in
more than three years after its Flight QZ8501 went missing. A lot many travelers lost faith in
the airline. This has affected the company profits for a short period. AirAsia took the whole
responsibility and believed in shifting people negative attitude towards the airline (Wise, 2015).
The Kuala Lumpur-traded shares of AirAsia had fallen 7.8 percent as of 0320 GMT, their
biggest daily drop since Sept. 22, 2011. The stock had dropped as much as 12.9 percent after the
opening, compared with a 0.4 percent decline in Kuala Lumpur’s benchmark index. The fall in
investor’s faith has affected the brand and later created a question in their mind. They find it
difficult for them to manage the interest of people in the company (Plucinska, 2015).
About 59.5 million AirAsia shares had been traded. That was about 5.2 times the stock’s average
full-day volume over the past 30 days. The fall in the price of AirAsia share was considered to be
the highest fall after 2011. However, as expected the price of share went up after sometime
(REUTERS, AGENCE FRANCE-PRESSE, 2015).
Reaction of Investors to Problem and Solution
There was a drastic fall in the AirAsia’s share after the incident took place. The entire market
was bewildered after a fall in the market. Investor lost the hope in the company for a short
period of time. AirAsia try building customer faith that was lost after the crash. It is very obvious
from the research that has a sustainable impact on the investor. A negative image of the brand
was coated for the short period of time. Customers’ believed that the company is not trustworthy
enough to gain an effective market share. The fall in investor’s faith has affected the brand and

Analysis of AirAsia Airline Plane 8501 Crash in 2014 10
later created a question in their mind. They find it difficult for them to manage the interest of
people in the company. People do lose faith in a brand after such an incidence.
AirAsia replenish the lost faith of people in the company. The CEO of AirAsia came forward
and took complete responsibility of the incidence. It was pretty much understood that people
require and effective plan in order to gear up people interest (McGee, 2015).
Trend Analysis of Share Price during the Period
The following data shows the change in the price of AirAsia during the event. It states forward
the changes in the fall of the prices. The AirAsia share price fell 7.8 percent at the starting stage.
It started recovering in July 2015. The chart represents the changes in market share of AirAsia
after the incidence. This directly showcases the impact of this incidence on the company
(Reuters, 2015).

Analysis of AirAsia Airline Plane 8501 Crash in 2014 11
Conclusions
To conclude, the incidence had a long lasting impact in the history of AirAsia. It can be seen that
Airliner faced multiple impacts due to the incidence. People lost faith in the airliner that has
shaken the faith of people. It is important enough for taking inference of such incidences and
developing a proper strategy in order to avoid any such incidence in future. The report provide
with multiple theories. It examines the consequences that lead to this event and further affected
the share market.
Summary of Key learning Points
 The aircraft crash lead to series of consequences generating multiple allegations on the
AirAsia
 The deadliest incident created a deep concern in mind of people regarding the credibility
of aircraft
 The failure was caused due to the RTL and ineffective training to the pilots.
 The share market was affected due to the incidence for a short period which later started
recovering in July 2015.
Recommendations
To company
It is recommended that, AirAsia need to incorporate an effective training process. The problem
can only be eliminated if the company is able to manage the situation with a correct approach.
This is important for gaining effectiveness in drawing efficiency in the best possible way.

Analysis of AirAsia Airline Plane 8501 Crash in 2014 12
To readers
It is recommended that, for safety sake the customers need to keep faith in the airliner. It is
further suggested that the travellers should refrain themselves from using airline that are
continuously facing the issues.

Analysis of AirAsia Airline Plane 8501 Crash in 2014 13
References
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25 November 2017
Auxier, E.2015. “PULL DOWN!” — HARSH LESSONS FROM THE AIRASIA 8501
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Barreveld, D., 2015. Air Crash Investigations-Cracked Solder Joint-The Crash of Indonesia Air
Asia Flight 8501. Lulu Press, Inc.

Analysis of AirAsia Airline Plane 8501 Crash in 2014 14
Bellamy, W.2015. AirAsia Flight 8501 Crash Caused by Pilot Error, Rudder Units. Online.
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Analysis of AirAsia Airline Plane 8501 Crash in 2014 15
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2017

Analysis of AirAsia Airline Plane 8501 Crash in 2014 16
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