The A380 is a legendary aircraft. It illustrates brilliant aeronautical engineering, technology, comfort and is in fact one of the best ever built civilian airliners in the history of aviation. Unfortunately, unless a huge miraculous order lands in Toulouse, this great aircraft could be on its way to becoming a big white elephant. Although I did not personally come up with the white elephant description, it was shared with me by one of the highly respected operators of the A380. I agree that it is becoming one commercially.
Not Enough Orders:
With numerous cancelled orders, below expectation deliveries and lack of customers needed to keep the aircraft alive, Airbus Industries and the governments who continue to subsidize its production with the generous contribution of the European taxpayer can no longer justify its continuity. The company is dealing with a rapidly shrinking customer base and less than a handful of customers who can only accommodate limited numbers of this huge vessel, which has also made the lives of many airport operators difficult. Numerous potential customers who have considered acquiring the A380 are changing their strategies and plans.
This means that, commercially, the A380 is terminally ill. Its high operating and maintenance costs are by far the highest in the industry. The aircraft is also being used by some of its operators to dump capacity in certain markets. Capacity dumping in international air commerce has long lasting effects on other airlines, their performance, and labor and upsets the basic fundamentals of competition in air commerce. Furthermore, the latest introduction of 3 room residences by some operators transforms the aircraft into a symbol of arrogance. The vast majority of passengers do not need flying condominiums, in-flight butlers, flying domestic help, spas, and open bars. Instead, they need safe and comfortable aircraft to transport them from one point to another. In a very competitive and cutthroat industry, air carriers need more fuel-efficient aircraft with fewer engines, less maintenance, 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 near 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 especially be 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:
There is no doubt that the A380 is a marvelous creation of aeronautical engineering, technology and comfort. It is also a possible answer to aerospace congestion provided that every A380 flight has near 100 % load factor. But in addition to a questionable commercial value, the aircraft has helped dump capacity in certain markets, thus harming other air carriers. One can get away with almost anything in commercial civil aviation and pushing airplanes but with one exception: numerical reality. Unfortunately, the A380 is not meeting the numerical expectation of its operators or those who considered acquiring the aircraft. This makes the A380 a numerical casualty. The A380 is also an operational casualty. The introduction of new aviation regulations for Extended Range Twin Engine Operation (ETOPS) puts all aircraft with 4 engines including the A340, A380 and B747-8 at a disadvantage when compared with the new generations of twin aircraft including the A330 neo, 777-9X and A350. Ironically, aircraft manufacturers and operators often push incremental changes to ETOPS. They are more powerful than regulators, while politically speaking, no regulator is in a position to push back against the might of the industry they are required to regulate.
Future Use of The A380:
We will soon see the A380 hauling cargo by second hand owners and tour operators before it becomes a staple at the Mojave Desert and perhaps few at some air museums. Airbus can also donate some to serve noble causes including colleges with aeronautical engineering and aviation curriculums, to the United Nations World Food Program, an operation that spends millions to lease antiquated aircraft to deliver food and other relief supply around the world. Turkey was very innovative last week when it sank an older sibling, a former THY A300 in the Aegean Sea to create artificial coral reefs. This is another thought although far fetched.