The A380 was one of the top topics of discussion at this year’s “Airbus Innovation Days”, Airbus’s annual media briefing for the aviation media, and not least because the location of this year’s event was the European planemaker’s A380 final assembly line facilities at Toulouse.
Ten years after its first flight, the future of the world’s largest airliner – which has not received any new orders so far this year and has seen existing orders either cancelled or deferred – is hotly debated. Today, total A380 firm orders stand at 317, and more than half of these have now been delivered.
In addition to no new orders so far in 2015, doubts remain over the robustness of at least some of the existing order backlog, such as the six on order for Virgin Atlantic. Other airlines such as Qantas and Air France have deferred A380 deliveries. And two A380s have been built for Japan’s now-bankrupt Skymark Airlines, which Airbus now has to remarket.
A perception has taken hold that the A380 is a good aircraft, but too big for all bar a small number of high-density city pairs.
“Is it a big market? It’s not a gigantic market,” Airbus chief operating officer for customers John Leahy said of demand for the A380 at the Innovation Days briefing on Thursday. “But if aviation doubles every 15 years the market will need it. It needs it today.”
“We should have some more orders for the A380 this year,” Leahy promised.
“The fact is there is demand for the A380 out there, we’ve got several campaigns under way.”
One campaign definitely underway is Emirates’ push to convince Airbus to develop a re-engined A380neo. Emirates, the world’s biggest A380 customer, has 60 A380s in its fleet, with 140 in total on order, and its president Tim Clark is the aircraft’s greatest advocate, both for the existing model and the proposed A380neo.
But developing the A380neo would cost an estimated €2 billion, while Leahy described as a “hard sell” given that it is only now the A380 program is breaking even.
“I’ve said publicly already that it is a very hard sell to our board to do anything for one customer, even a big customer. But the fact is Tim [Clark] has made it very clear that he sees demand for 200 just from Emirates for that aeroplane,” Leahy said.
But, said Leahy: “we’re still studying the business case”.
Leahy was also bullish about the A380’s prospects on the second-hand market. The A380 first entered service in 2007, and given key operators such as Emirates and Singapore Airlines generally only operate aircraft up to 10 years of age, the first examples could soon be on the second hand market. And if media reports are correct, Malaysia Airlines may soon put up its fleet of six A380s on the market as part of the airline’s massive corporate restructure.
Leahy said of used A380 aircraft: “I see as a big opportunity.”
He said that an A380 at its half life, with a book value of US$100 million, could be leased for around US$1 million a month.
“What’s a 777-300ER going for at the moment? It’s going for more than $1m a month,” Leahy said.
“So I think we open up a really unique opportunity here that some operators who have never even considered an A380 before are starting to look at the fact that for about the rental per month of the 777-300ER you could have an A380, maybe there are some routes I should try. I see this as a great market opportunity, I can’t wait to get there.”
Airbus head of strategy Kiran Rao told media interest in second-hand A380s could come from long-haul, low-cost carriers in Asia configuring the aircraft to seat between 600 and 650 passengers in a two-class configuration optimised for six- to eight-hour missions.
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