Singapore Airlines Airbus A380-841 (c/n 45) 9V-SKJ climbs from Rwy 25L at Los Angeles International Airport (LAX/KLAX) on November 11, 2011.
(Photo by Michael Carter)
A new report said the Airbus A380, the airplane that landed in the middle of the controversy involving the Gulf airlines, is entering a pivotal year.
That's because the airplane's principal buyer, Emirates President Tim Clark, is calling for an updated, more efficient, re-engined version, an A380neo. Clark wants seat costs to decline by 10%."Sales continue to be slow for the A380 and the backlog is shrinking." wrote aerospace analyst Scott Hamilton in the report.
"(But) with all the talk of an A380neo, Airbus faces a conundrum. With sales already dried up, discussion of the neo puts potential customers on the sidelines, waiting for a decision." The report, titled "To neo or not to neo, that is the question for Airbus and the A380," appeared in a recent edition of Hamilton's weekly publication Leeham News and Comment.
It came at a time when the Gulf airlines are embroiled in controversy after a report compiled for American, Delta and United laid out how the governments of Qatar, the United Arab Emirates, and Abu Dhabi and Dubai, the two largest emirates, have provided about $39 billion in subsidies to the airlines -- Qatar Airways, the flag carrier of Qatar; and Etihad Airways and Emirates, flag carriers of the UAE. Meanwhile, the operators of Dubai International said Monday that in 2014, the airport had more A380 operations than anyplace else. Dubai International had 15,098 A380 flights to 39 destinations around the world during 2014, up from 10,608 flights to 26 destinations in 2013, according to the airport's 2014 yearbook, which was published Monday.
"A380 flights were operated by both Emirates Airlines, the world's biggest operator of the double-decker aircraft, and Qantas," the report said.
Emirates and Qantas have a code-share agreement and also share revenue. Dubai International has the world's first A380 facility constructed specifically for the aircraft. The next busiest A380 airport was London Heathrow with 5,434 A380 flights to 11 cities, followed by Singapore's Changi airport with 5,398 A380 flights to 18 destinations, the airport said. The A380, the world's largest commercial aircraft, typically provides seating for about 500 passengers.
It has long been the subject of broad disagreement over whether Airbus should ever have attempted such a project. Since it began flying in 2007, Airbus has delivered just 153 aircraft, including 58 to Emirates, which has ordered 140 in total.
During a media conference last week, Clark was asked about frequent charges that Emirates sticks A380s on routes where they provide more capacity than markets can absorb, such as Dubai-Dallas and Milan-JFK, which will get an Emirates A380 in June.
"The 380s are probably the most successful aircraft in our fleet," Clark said. "They are hugely profitable, full all of the time," he said, noting that they typically fly with load factors in the high 80s (percent) and low 90s, on routes where "demand is there for seat capacity."
Milan-JFK is a particularly controversial route. It is discussed in detail in the big three U.S. airlines' 55-page report. Emirates launched service in October 2013, when the route already had four daily non-stop flights by Alitalia, American, Delta and United (to Newark). Fares fell. Bookings rose.
"The excess capacity on the route has driven U.S. carriers' margins to a level that is well below the industry cost of capital," the report said. "(This) will eventually force one or more U.S. carrier to exit the route." Airbus is expected to decide this year whether to offer an A380neo. "The business case is not completed on the neo," John Leahy, chief operating officer-customers for Airbus, told Hamilton. "I don't want to get into details. One of the things we'd be looking at would be in excess of 10% fuel burn reduction."
For the moment, Airbus faces the same problem both it and Boeing face when customers begin to anticipate a newer, more efficient version of an existing aircraft. Airbus saw "a stall in orders for the A320 while waiting for a neo decision (and) Boeing saw a similar slow-down in 737 sales until a decision came," Hamilton said. Once the decisions were made, sales resumed, he said, but "as for the wide-body A330, sales of what's now called the A330ceo haven't recovered and Airbus has announced it will lower production rates on the A330 to six a month in 2016."
As for Boeing, it "is officially mum about the prospect of an A380neo, other than its long-time skepticism over the viability of the program," Hamilton wrote.
"Privately, some Boeing officials can hardly withhold their glee at the prospect of Airbus proceeding with the neo," he said. "Such an effort will tie up money and resources, diverting both from other projects, they believe."
(Ted Reed - The Street)
No comments:
Post a Comment