HAECO's Financial Efficiency: Working Capital and Airbus A380

This report provides an overview of HAECO's working capital management strategies, focusing on the utilization and monitoring of current assets and liabilities. It analyzes the financial efficiency of HAECO's operations, considering factors such as aircraft servicing costs and the decision to terminate Airbus A380 production due to cost issues and market considerations. The report also emphasizes the importance of proper working capital management for HAECO's operational success and financial health, referencing relevant research on global finance and working capital management.

Finance
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Table of Contents
Introduction...........................................................................................................................................3
Background............................................................................................................................................3
The Rationale for the Topic...................................................................................................................3
References.............................................................................................................................................4
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Introduction
HECO is one of the most popular maintenance and aircraft engineering group which was
established in 1950 in Hong Kong. It has been focusing on providing complete support to its
customers based in Hong Kong, China, Mainland, and the United States. HECO has
completed more than 60 years of its operations and has gained the trust of its customers. It is
offering airframe services like a cabin, airframe maintenance, winglet modification, engine,
support shop, and many other services (Holton, 2012).
Background
The topics which are going to cover in this assignment is working capital management of
HAECO which will include the strategies that are being used by the company to utilize and
monitor two components of its working capital. The current liabilities and current assets of
HECO are also being analyzed to get a proper understanding of its financial efficient
operations. It will also include the cost of aircraft, servicing cost of an aircraft. This
assignment will also review the facts behind terminating the production of Airbus A380.
The Rationale for the Topic
It is important for HAECO to analyze how a holding of classes of aircraft making an impact
on its working capital management. Proper management of working capital is necessary for
its operations success and financial health. The servicing cost of an airline depends on the
condition and age of the aircraft. A proper inspection required before working on the aircraft
to understand the condition of the same (Preve and Sarria-Allende, 2010). HAECO has taken
a decision of terminating A380 in 2022 because of cost issue and lack of market of its parts.
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References
Holton, R. (2012). Global Finance. 4th ed. Hoboken: Taylor & amp; Francis.
Preve, L. and Sarria-Allende, V. (2010). Working capital management. 4th ed.
New York: Oxford University Press.
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