The Big White Elephant is on life support but not for much longer. Airbus Industries, its parent EADS and the governments who continue to subsidize its production can no longer justify its continuity at the expense of the European tax payer. A rapidly shrinking customer base and less than a hand full of customers who can only accommodate limited numbers of this huge vessel that has also made the lives of many airports difficult.
Commercially, the terminally ill A380 has become a symbol of many airlines’ worst nightmares including capacity dumping, excessive fuel consumption and high operating costs. All three factors are enough to bankrupt any airline. Equally important, travelers do not need flying condominiums, in-flight butlers, spas and open bars. In a very competitive and cutthroat industry, air carriers need more fuel-efficient aircraft with fewer engines and less parking and ground handling resources.
The Super Jumbo And Numerical Realities:
The development of the A380 cost Airbus Industries near $30 billion. Based on the number of aircraft manufactured, ordered, delivered and cancelled orders, it will be impossible for Airbus to recover its development costs. Furthermore, Airbus has become increasingly pessimistic with the current level of annual deliveries that are expected to remain near or below 20 aircraft until 2017 but could be less if more customers opt to cancel their existing orders. With more than 78 A380s in its fleet and expected to reach more than 140 by the time it takes delivery of its full order, Emirates Airlines remains the largest customer and user of the type.
The Dubai owned carrier unsuccessfully tried to extend the life of the A380 when its executives attempted to persuade Airbus to develop an A380 neo version. However, Emirates realizes that even if Airbus moves forward to meet its wishes for a more efficient version, one customer is not enough to keep this aircraft alive. This would be especially the case after Emirates reported a drop in its annual sales for the first time in 11 years in addition to a drop in its load factor by little less than 3.5 points to 76% meaning that its A380 fleet is barely meeting its anticipated capacity. Emirates recent order of 150 777-9X is an indication that the airline is embracing reality and a plan B to gradually phase out the A380.
The End of A Super Jumbo:
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