Monday, November 27, 2017

Plane leasing company forced to start own airline because nobody wants its A380s


An Irish aircraft leasing company is creating its own airline because it can’t find anyone to borrow its A380 superjumbos.

Dublin-based Amedeo counts eight A380s among its fleet, and has a further 20 on order from Airbus, but such is the lack of interest in the world’s largest passenger plane that it has been unable to renew its leases, or find new customers, despite months of negotiations.

So it has come up with a novel solution: launching its own A380-only airline. According to Mark Lapidus, Amedeo’s chief executive, the new airline’s business model will see it offer seats to existing carriers, or to potential non-traditional arrivals such as Airbnb. Passengers would buy their ticket through another company, while Amedeo would operate the flight, using its own cabin crew but tailoring the service to suit the client.

“Joint ventures and codeshares are making passengers feel accustomed to buying tickets with one [airline] but flying with another,” Mr Lapidus told The Financial Times. He added that Amedeo would apply for an air operator’s licence next year.

The growing collection of low-cost airlines offering long-haul flights, such as Norwegian, WOW Air, Level and Air Asia X, would be obvious targets for Amedeo. Mr Lapidus said it was in early discussion with a number of possible customers, including non-aviation firms like Airbnb who are looking for a simple way to enter the market.

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In January, Mr Lapidus said the A380 needed “disruptive” airlines to secure its future, citing Norwegian, and suggested that the model was a natural fit for budget airlines willing to squeeze in more economy class seats. While the A380 is certified to carry up to 868 people, most operators use a two- or three-class seating configuration which means it carries far fewer in practice. On some flights, Emirates, for example, carries 399 economy class passengers, 76 in business class and 14 in first class, for a total of just 489.

“When the A380 is properly configured with 600 to 700 seats it beats the economics in terms of unit costs of anything flying,” he said at the time.

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Whether the proposal can save the A380 remains to be seen. The model hasn’t won a new customer in two years and at the Dubai Airshow earlier this month, Emirates, its biggest client, backtracked on an expected order for 38 of the superjumbos (it bought 40 Boeing 787-10s instead). Just days later Singapore Airlines grounded and stored one of its A380s after just 10 years of use.

(Oliver Smith - The Telegraph)

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