Bad timing forces Airbus to end A380 production

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Airbus A380
Airbus A380

Bad timing forces Airbus to end A380 production

 

Timing is everything. Just ask Tom Enders, the outgoing CEO of Airbus, who announced on 14 February that Airbus would cease production of the super jumbo A380 by 2021. At the company’s annual press conference to announce the 2018 financial results, a tie-less Enders said the decision was “painful” because of the amount of sweat and toil the company put into developing the plane. “But we have to use facts and with the Emirates order, it means that we don’t have enough backlog” to justify continuing the programme, Enders said.

“Today’s announcement is painful for us and the A380 communities worldwide,” Enders added. “What we’re seeing here is the end of the large four-engine aircraft. There has been speculation for years that we were 10 years too early, but probably we were 10 years too late, or more.”

So, at the end of the day, the plane that Airbus hoped would duplicate the success of the ‘Queen of the skies’ – the Boeing 747 – which is celebrating 50 years of service, is now fading into the sunset and ‘going west’. Airbus said of course it will continue to service the roughly 220 A380s that will be in operation by 2021 and will probably still be flying into the 2030s.

The final nail in the A380’s coffin was the decision by Emirates and a few other carriers to either reduce or outright cancel orders for the plane. Launch customer Singapore Airlines returned a few of its first A380s to the lessor and those were parted out. Qatar Airways announced it would cease flying its A380s once each model hit the 10-year operational mark, Qantas cancelled an order for eight A380s and finally Emirates, the largest operator of A380s, said it was reducing its orders for the plane in favour of widebody twin-engine models like the A330neo and A350.

Just before the conference, Emirates and Airbus announced that the Gulf carrier would take an additional 14 A380s up to 2021 after cutting its original order by 39 planes. Emirates will instead buy 40 A330neo and 30 A350s. The deal will still leave Emirates as the world’s largest A380 operator with 123 aircraft. The deal for the A330s and A350s is worth US$21.4 billion at list prices, which no airline actually pays after discounts.

Airbus also announced that Abu Dhabi-based Etihad Airways will cut an order for the latest A350 wide-bodies by 42 planes. Airbus said it was taking a US$1.2 billion charge in writing off the A380 and posted an adjusted full-year profit of 5.8 billion euros (US$6.5 billion) on sales of 64 billion euros. – Matt Driskill

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