Production halved Airbus Sounds Death Knell on Super Jumbos

Airbus is halving production of its double-decker A380 aircraft after a lackluster response from buyers. The move could spell the end of the 50-year super jumbo era.
This year's Farnborough Airshow has been gloomy for the A380.

Airbus made its revelation during this week's Farnborough International Airshow, the industry's biannual trade fair near London.

On Tuesday, the firm unveiled a billion-strong order book for its bestselling A320 series of aircraft and said its brand-new long-distance A350-1000 model was being snapped up by British carrier Virgin Atlantic.

But the real news centered on a troubled model hit by lackluster demand: It revealed that the A380, the company's superjumbo flagship, is not selling as well as hoped and will have its production levels slashed.

Instead of the 27 machines built last year, only 12 are to be made from 2018. “We are reacting to current demand,” said Airbus chief executive Fabrice Brégier. “We are keeping all options open for the future.”

That is hardly an upbeat outlook for the world's biggest passenger plane, which has seen its orders wane. Officially Airbus still has to deliver 127 of 319 orders for the double-decker aircraft but even Airbus sources voiced doubts whether all the ordered machines would actually be fulfilled by the airlines and leasing firms.

The era of super jumbos that started with the launch of Boeing's 747 jumbo jet in 1969 is coming to a swift end.

The A380 has also failed to impress financially. “The new rate of production is hardly worthwhile and for that reason the aircraft will be buried in coming years,” said sector analyst Richard Aboulafia.

That suggests that the era of super jumbos that started with the launch of Boeing's 747 jumbo jet in 1969 is coming to a swift end.

The A380 was designed in response to predictions that ever bigger airplanes would help deal with the growing numbers of passengers passing through major hub airports. With up to 850 seats, it was seen as trumping the ageing Boeing 747 for good. The European plane builder hoped its new model would soon reign supreme on routes between Europe, Asia and North America.

But doubts surfaced as early as the planning phase in the late 1990s. Arch-rival Boeing shelved plans for a new super jumbo because it took a contrasting perspective on the future of air travel. Instead of using smaller planes to ferry passengers to huge super jumbo hubs, it thought it would make more sense to use medium-sized aircraft to fly people more frequently on direct routes from local airports.

In addition, less popular routes with fewer passengers would be better served with small planes, the company decided. As a result, Boeing opted to build the smaller 787 Dreamliner range, which aimed to be more flexible and efficient to buy and run. Their plan paid off and airlines snapped up the planes.

Airbus, in contrast, hit a snag with the A380 even before its first delivery was made. As German and French technicians worked with different software, the planes' wiring was flawed. Then, Singapore Airlines got the first ever A380 in 2007 just as the sector felt the pinch of the financial crisis. Lufthansa, British Airways and Air France all took only around a dozen aircraft.

And U.S. airlines are yet to order a single super jumbo. Similarly the Chinese, which Airbus eyed as strong potential customers, failed to warm to the new machine. After all, the communist leaders suspected that the aircraft, which would just serve the massive hubs of Shanghai and Beijing, could stall the development of the rest of the country.

The state-owned airline China Southern ordered just five planes. Only Emirates, the Gulf carrier, placed a big order, taking roughly one out of every two of the 142 planes ordered.

But now even Airbus' leading customer is feeling peeved. In addition to a reduced price, last year Emirates chief Tim Clark called for the A380 to have its engine modernized, as happened with the A320. But Mr. Brégier refused, saying that Airbus would not make an investment worth billions just for one customer.

And that has helped consign the A380 to the long list of obsolete models. Instead, the future is geared towards the latest generation of smaller long-haul planes, such as the Boeing 777, which will market a new model in 2019, or the A350, which can carry up to 360 passengers.

 

Markus Fasse covers the aviation and automobile industry. To contact the author: [email protected]