Airbus announced that it is ceasing production on its A380 jumbo aircraft 12 years after production started. Why has the world's largest passenger aircraft failed?
The aerospace manufacturer cited a “lack of airline demand” as the reason production of the A380 will cease in 2021.
Dubai’s Emirates airline, the largest A380 customer, is reducing its A380 orderbook from 162 to 123 aircraft. Emirates will take delivery of 14 further A380s over the next two years.
“As a result of this decision we have no substantial A380 backlog and hence no basis to sustain production, despite all our sales efforts with other airlines in recent years. This leads to the end of A380 deliveries in 2021,” said Airbus CEO Tom Enders.
“The consequences of this decision are largely embedded in our 2018 full year results,” he added.
The A380 was a challenger to US rival Boeing’s dominance of the large aircraft market. The announcement of the end of the A380, the world’s first fully double-deck passenger jet, comes at the same time that Boeing’s 747 ‘jumbo jet’ turns 50.
Airbus decided to scale up the size of their aircraft with the A380, it featured over 500 sq metres of usable floor space, two full-length decks with widebody dimensions, onboard spas and bars. At the same time, Boeing developed its smaller and nimbler 787 Dreamliner.
According to Boeing, the 787 Dreamliner is the fastest-selling widebody jet in history and it allows airlines to reduce fuel use and emissions by 20-25%. The combination of its fuel efficiency and ability to serve far-away destinations has helped airlines save over £30bn of fuel and open more than 210 non-stop routes.
Is the A380 cost-effective?
Orders for the A380 could have slowed because the aircraft is too large, making it unprofitable when too many seats go unfilled.
“I’ve been very clear with Airbus that if they want to sell the aircraft, they’re going to have to be very aggressive on the price,” Willie Walsh, CEO of International Airlines Group, said at a Oneworld event in London earlier this month according to Reuters.
Walsh said: “The pricing of that aircraft has not been as attractive as we believe it needs to be.”
Despite it not being a cost-effective option, HH Sheikh Ahmed bin Saeed Al Maktoum, chairman and chief executive of Emirates Airline and Group, said that the aircraft has been “loved by our customers and our crew. It is a differentiator for Emirates.”
Emirates also announced an order for 40 A330-900 aircraft, and 30 A350-900 aircraft. The deal is worth £17bn.
The latest generation Airbus A330neo and A350 aircraft will be delivered to Emirates starting from 2021 and 2024.
On this decision, Al Maktoum said: “Emirates’ fleet strategy to operate a young, modern, and efficient all-wide body fleet remains unchanged. Both the A330neos and A350s will play an important role in our future fleet and network plans.”
The A330neo is powered by high-bypass ratio, Rolls-Royce’s Trent 7000 engines, and designed with an advanced high-span wing that reportedly vastly improves aerodynamics.
With fuel prices rising and environmentalists questioning the impact of aircraft, some airlines are favouring smaller, but more efficient planes. Airbus reports that “The A330neo has the lowest seat-mile cost of any mid-size widebody and burns 25% less fuel burn than the previous generation A330.”