• Tuesday, July 23, 2019

Airbus to scrap production of A380 superjumbo

Discussion in 'Europe & Russia' started by Jyotish, Feb 14, 2019.

  1. Jyotish

    Jyotish SENIOR MEMBER

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    Airbus to scrap production of A380 superjumbo

    Tim Hepher

    FEBRUARY 14, 2019

    TOULOUSE, France (Reuters) - Europe’s Airbus announced plans to scrap production of the A380 superjumbo on Thursday, abandoning its dream of dominating the skies with a cruiseliner for the 21st century after years of lacklustre sales.

    The world’s largest airliner, with two decks of spacious cabins and room for 544 people in standard layout, was designed to challenge Boeing’s legendary 747 but failed to take hold as airlines backed a new generation of smaller, more nimble jets.

    Airbus said in a statement that the last A380 would be delivered in 2021.

    Confirming a shake-up first reported by Reuters, it said Emirates - the largest A380 customer - had decided to reduce its orders for the iconic superjumbo and order a total of 70 of the smaller A350 and A330neo models.

    The European company said it would enter talks with unions in coming weeks over the 3,000-3,500 jobs potentially affected.

    Airbus will produce 17 more of the planes including 14 for Emirates and 3 for Japanese airline ANA.

    As part of the restructuring, Emirates placed a new order for 40 A330-900neo jets and 30 A350-900 aircraft, partially restoring a purchase of A350 aircraft which it cancelled in 2014.

    LEADING BUYER ‘DISAPPOINTED’
    Emirates, which had built its global brand around the A380 and Boeing 777 and which also has 100 of the Airbus superjumbos in its fleet, said it was disappointed by the closure.

    “Emirates has been a staunch supporter of the A380 since its very inception,” said Emirates Chairman Sheikh Ahmed bin Saeed al-Maktoum.

    “While we are disappointed to have to give up our order, and sad that the programme could not be sustained, we accept that this is the reality of the situation,” he added.

    The A380 will remain a pillar of the Emirates fleet well into the 2030s, stated the airline.

    Emirates’ local rival Etihad of Abu Dhabi also disclosed it was cutting some Airbus and Boeing jet orders, highlighting growing questions over the growth of Gulf airlines.

    Making its maiden flight in 2005, the A380 was a major step in Airbus’s efforts to compete on equal terms with Boeing and challenge what had been a cash cow for its arch-rival.

    But sales of the industry’s largest four-engined jets have fallen due to improvements in lighter twin-engined alternatives, such as the Boeing 787 and 777 or Airbus’s own A350.

    The prospect of a premature halt to A380 production emerged last month as part of a restructuring of orders first reported by Reuters.

    On Wednesday, Reuters reported that Airbus was poised to axe the superjumbo and would likely give an update coinciding with results due on Thursday morning.

    The decision to scrap production is the last major step by outgoing Airbus Chief Executive Tom Enders.

    https://www.reuters.com/article/us-...p-production-of-a380-superjumbo-idUSKCN1Q30GW
     
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  2. khansaheeb

    khansaheeb SENIOR MEMBER

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    wtf
     
  3. Nilgiri

    Nilgiri ELITE MEMBER

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    I saw this coming about 5 years back. The order ramp needed just was not happening. Essentially the A320 family ended up subsidising this prestige project/gamble.

    Hey I suppose it was better than not trying at all though.

    The key line is here. @Dante80 @GeraltofRivia
     
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  4. Sabretooth

    Sabretooth FULL MEMBER

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    Finally, they came to senses. It could never beat Boeing 777 which was and still is the money maker. A380 is a white elephant and many airlines across the globe have suffered because of it and are getting rid of it. The huge volume of PAX boarding and exiting, to and from this huge whale in itself is an arduous task and many airports still can't handle its ground operation. These aircraft suffered long turnaround durations and cost a lot of money. Instead of this, Airbus should have stuck to increasing the capacity, range and fuel efficiency of twin-engine A330. It was another ambitious project like Concord which was doomed to fail.
     
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  5. GeraltofRivia

    GeraltofRivia FULL MEMBER

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    Interesting. It must cost them a lot money and precious facilities to maintain the production capacity. Looks like A330/350 twin engine jet hits the sweat point of range, size, and economy for long range lines.
     
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  6. Dante80

    Dante80 FULL MEMBER

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    This has been known for quite some time now, since the abandonment of the A340 and the move to the monstrous 250kN engines. Once upon a time, long range WB aircraft that traversed significant bodies of water needed to have more than two engines for reliability and security purposes. As engines got larger and more efficient, it soon became apparent that two larger engines could do the same job as three or four, but cost a lot less money to operate. For the cut-throat commercial aviation business, maximizing your profit per seat means keeping operating and fuel costs as low as humanly possible.

    A380 was designed as a response to the expected surge in traffic coming mainly from Asia. It was not strictly a prestige/luxury project. But while said surge partly materialized, airlines soon found out that the process the platform uses to cut operating costs down was too dependent on line by line load parameters. When you build an aircraft that can only optimize cost per seat via having to sit virtually everyone every-time, you soon come to the conclusion that balancing frequency and capacity is a big problem. The huge capacity offered by each flight simply eroded the yield.

    And the rest is history.
     
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  7. VCheng

    VCheng ELITE MEMBER

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    Airbus bet big on the hub-and-spoke model continuing, while Boeing bet big on increasing point-to-point travel.
     
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  8. Dante80

    Dante80 FULL MEMBER

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    You cannot really fault them for that though. Both Emirates and SA were beating the drum hard on that, and the data corroborating a big increase in hub activity were forthcoming (together with the airport investments from the big players). Also, the debilitating results of 9/11 on commercial aviation were not fully realized yet by the time the project reached the point of no return. Boeing was also betting on the 747X at the time, and only moved to the 7E7 that became the Dreamliner when both 747X and the Sonic Cruiser failed to materialize enough support from the companies.
     
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  9. VCheng

    VCheng ELITE MEMBER

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    I am not faulting anyone, but merely noting the value of knowing your market and your customers, and responding as quickly as possible to changes in both.
     
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  10. dexter

    dexter SENIOR MEMBER

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  11. UKBengali

    UKBengali ELITE MEMBER

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    I do not think that the A380 was actually a mistake for Airbus.

    True that they did not make money on the plane but I am not sure if it is actually a loss maker in the grand scheme of things.

    Development costs are around the 20-25 billion US dollar mark. With total unit sales of just under 300 planes, that would mean that they would need to sell each aircraft aiming for unit profit of around 80-100 US million dollars to break even. It is unlikely that they made anywhere near this amount but the expertise they got from the A380 was readily transferred to the superb A350 which despite costing only a third as much to develop(~12 billion US dollars) as the Boeing Dreamliner(over 30 billion US dollars) is selling just as well as the Boeing plane.

    The experience that Airbus gained in making a 21st century Jumbo Jet has been priceless and they would also have used the tech in other projects of theirs.
     
    Last edited: Feb 15, 2019
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  12. Nilgiri

    Nilgiri ELITE MEMBER

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    I didn't say it was a mistake. I'd have tried too in the same position with the same data available that @Dante80 talking about.

    Just didn't pan out. Sometimes you got to take a good gamble on these things and accept in the end it didn't pan out.

    Airbus overall still has lot of good stuff going, they have hedged well....this is not a game-ender by any stretch.
     
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  13. Feng Leng

    Feng Leng SENIOR MEMBER

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    Wow... Airbus is done. It's going to be smaller than Bombardier soon.

    Just in time for COMAC to enter the market.
     
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  14. Dante80

    Dante80 FULL MEMBER

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    What are you talking about? Airbus just signed this, hours ago..

    Emirates signs deal for 40 A330-900s, 30 A350-900s
     
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  15. Oublious

    Oublious SENIOR MEMBER

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    dumb china men, airbus is bigger then your world ahahah...