Airbus’s A380 future hinges on an order from Emirates Airline, the aerospace manufacturer’s chief operating officer for customers John Leahy says.
The world’s largest passenger aircraft has struggled for sales in recent years, with carriers preferring twin-engine variants to serve their long-haul routes.
From a total order book of 317 aircraft, Airbus has delivered 222 A380s since launch customer Singapore Airlines (SIA) picked up the first of the type in 2007. The backlog sits at 95 aircraft, as at the end of December 2017.
Airbus had been hoping to secure a top-up order of A380s at the Dubai Airshow in November 2017. However, the airshow came and went without Emirates putting pen to paper.
Leahy said talks between Airbus and Emirates – the world’s largest operator of the A380 having recently picked up its 100th of the type – regarding an order for more was ongoing.
“Quite honestly if we can’t work out a deal with Emirates I think there is no choice but to shut down the program,” Leahy told reporters during Airbus’s 2017 orders and deliveries announcement on Monday (European time).
“But I am hopeful that we will work out a deal with Emirates and others can add airplanes on top of that.”
In light of the weakness in the very large passenger aircraft market, Airbus chief operating officer and Commercial Aircraft president Fabrice Bregier said the company planned to slow the production rate of the A380 from 15 aircraft delivered in 2017 to a projected 12 aircraft in 2018 and just eight in 2019.
Further, Bregier acknowledged there was a commercial challenge around the A380, noting an internal Airbus analysis of the program’s supply chain determined that there needed to be a “minimum of six aircraft a year to maintain industrially an efficient production line”.
“I can confirm today that we can have an industrially robust process to deliver down to six aircraft a year,” Bregier said.
“The challenge will be for us to maintain at least this level of industrial output in the years to come before taking advantage of the replacement of the A380s and potentially new markets.
“We will never produce white tails clearly but there are other potential customers beyond Emirates. It is clear that Emirates is key for the long term future of this program.
“I am not pleased with the ramp down but this is controlled.”
Leahy added Emirates was “probably the only one who has the ability right now in the marketplace to take a minimum of six a year for a period of eight to 10 years”.
The comments regarding the A380 program were made on the day Airbus reported it had delivered 718 aircraft in calendar 2017, a four per cent increase from 688 aircraft delivered in the prior year.
It was also the 15th consecutive year of increased production.
Meanwhile, Airbus said it secured 1,109 net orders in 2017, representing a a book-to-bill ratio of 1.5 and a 52 per cent increase from the 731 net orders in 2016.
Looking ahead, Bregier said Airbus’s A320ceo/neo program was on track to reach 60 aircraft deliveries a month by mid-2019.
Similarly, the A350 program was forecast to increase production to 10 aircraft a month by the end of 2018.
Bregier said 2017 was a challenging year for programs such as the A320neo and A350 XWB which faced supplier issues that affected deliveries to customers.
“At the end of the day what counts is the results and I am very pleased to say that we met our targets and 2017 again demonstrates an additional ramp up in deliveries and production,” Bregier said.
“I think 2018 will see a further ramp up of our deliveries.”
Earlier in January, Boeing announced it delivered 763 aircraft in calendar 2017, an increase of 15 aircraft from the prior year and within its previously announced guidance of 760-765 deliveries.
Emirates holds the key to Airbus's A380 future: Leahy
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