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Consolidated "Airbus 380 - problems and discontinuation" thread

Consolidated "Airbus 380 - problems and discontinuation" thread

Old Aug 27, 2014, 3:20 am
  #136  
 
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Originally Posted by wco81
I don't think I would need to shower on a plane.

Or even in a lounge.
If you have ever been to Jeddah on business in the Summer, and are returning to Europe after a hot airport, with a delayed, late flight, it might change your mind.

I'd love a shower in-flight, and perhaps an onboard dry cleaners too.
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Old Aug 27, 2014, 5:37 am
  #137  
 
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Originally Posted by bhrubin
All fine and dandy, but the topic at hand is whether or not the A380--not Airbus--is a failure. The A380 may be a delight for premium class passengers with the enhancements permitted by the extra space, but that doesn't mean the plane itself is a winner for Airbus. In simple economic terms, Airbus is unlikely to ever recoup its investment for the next 30+ years AT LEAST on the A380. That is what I call a business failure.

For the airlines that already have the A380, and Emirates which continues to get more, I'm sure they will serve their purpose for the few routes on which the A380 makes sense. I am very excited to fly the BA A380 in F in October the the EK A380 in F in January. I'm sure they will offer a F experience unlike any I've had thus far (except for CX F, perhaps). I will look forward to enjoying SQ A380 F, QF A380 F , LH A380 F, and OZ A380 F in the future, too. But I likely won't be seeing the A380 too often on most of the routes I fly or hope to fly since the A380 is just too big for those routes.
Not saying you are wrong, but show me the stats (Airbus development cost, break-even amount etc) to back up your claim. Otherwise, it is all guess work.
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Old Aug 27, 2014, 12:02 pm
  #138  
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Originally Posted by WindowSeat123
Not saying you are wrong, but show me the stats (Airbus development cost, break-even amount etc) to back up your claim. Otherwise, it is all guess work.
Sorry, all that info has been linked previously in the discussion, so I won't bother researching it all again now! If you don't believe it, so be it. I can live with that.
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Old Aug 27, 2014, 10:44 pm
  #139  
 
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Originally Posted by bhrubin
Sorry, all that info has been linked previously in the discussion, so I won't bother researching it all again now! If you don't believe it, so be it. I can live with that.
Well in that case, I have to cast doubts on the credibility of your claims. You have nothing to back up your claims. I don't see the numbers that would support your assertions. And yes, you can live with that.
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Old Aug 27, 2014, 10:47 pm
  #140  
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Originally Posted by WindowSeat123
Well in that case, I have to cast doubts on the credibility of your claims. You have nothing to back up your claims. I don't see the numbers that would support your assertions. And yes, you can live with that.
Oh dear. The info I cited was all info that was previously cited in THIS thread. [Removed unnecessarily personalized comment]

Last edited by cblaisd; Aug 28, 2014 at 6:15 pm
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Old Aug 28, 2014, 12:46 am
  #141  
 
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Originally Posted by bhrubin
Oh dear. The info I cited was all info that was previously cited in THIS thread. [Removed quote of now-deleted material
Where is this info you keep talking about? What is the source? All I see is you quoting news source out of context. So whether the A380 is really a failure as you claimed is open to question.

Last edited by cblaisd; Aug 28, 2014 at 6:15 pm
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Old Aug 28, 2014, 1:10 am
  #142  
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Originally Posted by WindowSeat123
Where is this info you keep talking about? What is the source? All I see is you quoting news source out of context. So whether the A380 is really a failure as you claimed is open to question.
OK, here we go, folks: http://www.nytimes.com/2014/08/10/bu...rbus-a380.html

While the A380 program has been a boon for the European aerospace industry, Airbus is unlikely to recover its research and development costs. The best it can now expect is to break even on production costs, according to analysts, provided that it can keep orders going.
As I said, Airbus is unlikely to recoup its investment designing/creating the A380.

The A380 has a list price of $400 million, but the pressure has forced Airbus to cut prices as much as 50 percent, according to industry analysts. So far, Airbus has received 318 orders and delivered 138 planes to just 11 airlines — a disappointing tally given forecasts that the plane would be a flagship aircraft for carriers worldwide.
Airbus has struggled to sell the planes. Orders have been slow, and not a single buyer has been found in the United States, South America, Africa or India. Only one airline in China has ordered it, and its only customer in Japan has canceled. Even existing customers are paring down orders.
And from another source: http://www.reuters.com/article/2014/...A151O120140206

Airbus said it aimed to get 750 total orders when it unveiled the double-decker passenger jet.

But 13 years after it was first launched, sales have remained at less than half that level as airlines focus attention on advances in the latest twin-engined jets. As of end-2013, Airbus had orders for 304 superjumbos.
Wow, just like I said. And like I and others had quoted earlier in this discussion--again, just like I said. Not so open a question, after all...like I said.

Last edited by bhrubin; Aug 28, 2014 at 1:36 am
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Old Aug 28, 2014, 1:22 am
  #143  
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Originally Posted by bhrubin
But 13 years after it was first launched, sales have remained at less than half that level as airlines focus attention on advances in the latest twin-engined jets. As of end-2013, Airbus had orders for 304 superjumbos.
It launched 13 years ago?
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Old Aug 28, 2014, 1:32 am
  #144  
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Just for fun, let's add another source that wasn't cited previously as far as I can remember: http://business.time.com/2013/10/23/...ensive-turkey/

Some highlights again:

“The A380 is, by definition, an uneconomic airplane unless you’re a state-owned enterprise with subsidies,” said Delta ceo Richard Anderson in a recent speech. He’s making a reference to Emirates and Singapore Airlines, who own about 45% of all planned deliveries. Emirates has 35 A380s operating out of a total order of 90. According to aviation expert Richard Aboulafia, vice president of analysis at Teal Group, there have been 167 net A380 orders over the last decade. Airbus planned to build 30 A380s annually but the current rate is less than 17 per year. “The people who are in the order book are the order book,” Aboulafia says, meaning the potential to add new orders is limited.
Sounds like Airbus isn't even coming close to its own projections to break even. It also sounds like Delta's CEO is pretty much saying what so many herein have said: Singapore and Emirates are state-owned enterprises that benefit from subsidies that are unavailable to non-state owned enterprises. Funny how Emirates and Singapore have such great Suite Classes on the A380 and have almost half of the orders, isn't it?

As things now stand, it is unlikely that the A380 will produce anything but a write-down for Airbus and its parent company EADS (soon to be called Airbus Group), which invested something on the order of $25 billion to get the first A380 airborne. The jet lists for about $400 million, but you can make them an offer: the going rate is somewhere north of $200 million.
Most airlines have canceled further orders. Lufthansa canceled 3 last year. Air France canceled the remaining 2 on its original order of 12. Virgin Atlantic has delayed all of its orders until 2018--giving it time to perhaps cancel entirely. Only Emirates ordered more. Emirates can't save it.

To boot, Airbus now has so discounted the A380 (about half price!) that it also means Airbus would have to sell even MORE than its originally projected 750 to break even. Which is why it can't break even. It's a loser for Airbus.

Not to mention, when the current A380s hit the secondary markets, that will kill the new models Airbus might have been able to sell. Plus all the lease companies that purchased significant numbers assuming the A380 would be a winner, which now will have to further discount those, undercutting Airbus even more in the future. Bad bet, Airbus. The A380 was all glam and not enough market.
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Old Aug 28, 2014, 2:40 am
  #145  
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Originally Posted by Always Flyin
Had you been seated in front of the engines, and particular in front of the engines and upstairs, you would have noted the plane is noticeably quieter than other aircraft.
I was seated in 2A. Again, I never noticed that it was quieter.
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Old Aug 28, 2014, 3:09 am
  #146  
 
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Originally Posted by bhrubin
Just for fun, let's add another source that wasn't cited previously as far as I can remember: http://business.time.com/2013/10/23/...ensive-turkey/

Some highlights again:



Sounds like Airbus isn't even coming close to its own projections to break even. It also sounds like Delta's CEO is pretty much saying what so many herein have said: Singapore and Emirates are state-owned enterprises that benefit from subsidies that are unavailable to non-state owned enterprises. Funny how Emirates and Singapore have such great Suite Classes on the A380 and have almost half of the orders, isn't it?



Most airlines have canceled further orders. Lufthansa canceled 3 last year. Air France canceled the remaining 2 on its original order of 12. Virgin Atlantic has delayed all of its orders until 2018--giving it time to perhaps cancel entirely. Only Emirates ordered more. Emirates can't save it.

To boot, Airbus now has so discounted the A380 (about half price!) that it also means Airbus would have to sell even MORE than its originally projected 750 to break even. Which is why it can't break even. It's a loser for Airbus.

Not to mention, when the current A380s hit the secondary markets, that will kill the new models Airbus might have been able to sell. Plus all the lease companies that purchased significant numbers assuming the A380 would be a winner, which now will have to further discount those, undercutting Airbus even more in the future. Bad bet, Airbus. The A380 was all glam and not enough market.
I suspect you must be an analyst betting the A380 will fail. If your are investing in the failure of the project, then of course you will say its gonna fail. The sources you quoted are also from analysts, bet it never occurred to you they may have an agenda or could never be wrong in their predictions? You did not provide hard figures to back up your claim. Show me Airbus's spreadsheets. What you quoted are future projections, which can change. Airbus is discounting the plane now, will it discount for the future? Market trends can change. I guess you never thought of that.

Analysts who predicted the failure of a product can sometimes be wrong. As an example, take the turboprop ATR 72. A little over ten years ago, things looked very bleak for the ATR program. They had orders for only 5 ATR 72s, all the analysts were saying jets were the way of the future for regional airliners and ATR should shut down production and just be a product support company for existing ATR 72s still flying. Well, what a difference a decade made. Since then ATR has sold over 800 planes. Quite a turnaround eh?

Long story short, I'm not sold on the A380 being a failure...or a success. We'll see in the next few years.

Last edited by WindowSeat123; Aug 28, 2014 at 3:27 am
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Old Aug 28, 2014, 10:19 am
  #147  
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Originally Posted by bhrubin
Most airlines have canceled further orders. Lufthansa canceled 3 last year. Air France canceled the remaining 2 on its original order of 12. Virgin Atlantic has delayed all of its orders until 2018--giving it time to perhaps cancel entirely. Only Emirates ordered more. Emirates can't save it.
So, a total of 5 cancellations? Hardly 'most airlines'...

You seem to pass off your opinion as 'fact' without much to back it up.
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Old Aug 28, 2014, 11:19 am
  #148  
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Originally Posted by DYKWIA
So, a total of 5 cancellations? Hardly 'most airlines'...

You seem to pass off your opinion as 'fact' without much to back it up.
You must be joking. Did you not read the original article cited?

Check this out for "fact" from 2013: http://aviationweek.com/awin/airbus-...klog-shrinking

The A380 has been selling slowly for some time, which Airbus has attributed to the sluggish world economy. While that is certainly a factor, Lufthansa's decision to reduce its firm orders to 14 from 17 raises more questions.
Aside from the Lufthansa reduction, several more of the 259 firm orders for the A380 are looking shaky. Leahy says “it is publicly known” that Virgin Atlantic's order for six A380s includes cancellation rights, and the airline has indicated many times that it is unlikely to take the aircraft. He also indicates that Hong Kong Airlines, with 10 A380s on order, might “convert” its commitment to “other products.” Kingfisher Airlines is still listed with five orders, although it stopped flying in 2012.

And there are serious doubts that Air Austral will take its two A380s that were intended to fly between Paris and the French overseas departments in a very high-density configuration. Air France has delayed some of its A380 deliveries as it continues its restructuring program and cuts back on capital expenditures.
That would be a total of 3 Lufthansa, 6 Virgin Atlantic, 10 Hong Kong, 5 Kingfisher, 2 Air Austral, not to mention the AF delays and possible cancels. That's 26 cancels or reductions from 2013 alone.

Plus this from 2014:
http://www.businessinsider.com/airbu...es-a380-2014-7

Airbus Group announced this week that it has cancelled an $1.7-billion order for six of its A380 superjumbos slated for Japanese low-cost carrier Skymark Airlines.
That would be another 6 cancels on the A380 for 2014.

Plus this from 2014: http://www.aviationnews-online.com/e...-four-engines/

Virgin Atlantic Airways again delayed its order for six A380 on account of weak global economic conditions, and Turkish Airlines reduced its estimated order number for the A380 to six from the earlier indicated fifteen.
That Turkish reduction from 15 to 6 A380s is another 9 reductions in A380 sales.

Between all the cancels, planned reductions, and expected cancels and reductions in the coming years, not to mention the discount from $400 million list price to the current asking price of about $200 million as previously cited, Airbus would need to sell twice as many A380s as it originally projected (original projection 750, and it isn't even close to halfway there) to BREAK EVEN on its investment--not even considering the money it loses on the production of each and every A380 at the new discounted price.

My opinion has plenty of facts to back it up. My opinion is based on those facts. [Removed unnecessarily personalized characterization and personal attack] the A380 was a very bad bet for Airbus.

Originally Posted by WindowSeat123
I suspect you must be an analyst betting the A380 will fail. If your are investing in the failure of the project, then of course you will say its gonna fail. The sources you quoted are also from analysts, bet it never occurred to you they may have an agenda or could never be wrong in their predictions? You did not provide hard figures to back up your claim. Show me Airbus's spreadsheets. What you quoted are future projections, which can change. Airbus is discounting the plane now, will it discount for the future? Market trends can change. I guess you never thought of that.

Analysts who predicted the failure of a product can sometimes be wrong. As an example, take the turboprop ATR 72. A little over ten years ago, things looked very bleak for the ATR program. They had orders for only 5 ATR 72s, all the analysts were saying jets were the way of the future for regional airliners and ATR should shut down production and just be a product support company for existing ATR 72s still flying. Well, what a difference a decade made. Since then ATR has sold over 800 planes. Quite a turnaround eh?

Long story short, I'm not sold on the A380 being a failure...or a success. We'll see in the next few years.
Wow. The FACTS are that Airbus projected it needed to sell 750 A380s to break even. It isn't even close to that mark now 14 years into the A380 program. It has produced and/or has future orders for only a total of 359 A380s as of today (including most of those that are now canceled and also including the 50 more A380s ordered by Emirates, the only carrier ordering MORE)--and the future orders are shrinking, being delayed, or canceled outright. I've shared plenty of facts and evidence of canceled orders from numerous airlines, yet you don't want to accept it.

[Removed personal attack and OMNI/PR political characterization]

Originally Posted by WindowSeat123
What you quoted are future projections, which can change. Airbus is discounting the plane now, will it discount for the future? Market trends can change. I guess you never thought of that.

Long story short, I'm not sold on the A380 being a failure...or a success. We'll see in the next few years.
On top of everything I already shared as evidence, here is another that puts the FUTURE of the A380 in perspective. From http://aviationweek.com/awin/airbus-...klog-shrinking

However, the major shift toward larger jets long predicted by Airbus has not happened yet. And the manufacturer is making the move tougher for airlines by offering highly efficient twin jets. Chief operating officer for customers, John Leahy, says airlines would have to install 550-560 seats in an A380 for the aircraft to match the unit costs of the A350-1000 that will enter the market in 2017. In other words, essentially all current operators are flying the aircraft in configurations that are much less attractive in terms of unit costs.
Airbus made a bad bet in the 1990s that airlines would prefer bigger 4 engine jets. It turns out that they were wrong--except for Emirates and a few routes that justify the unit costs for the A380. But not even close to enough to recoup Airbus' initial $25 billion investment to develop the A380 (750 A380s at the original asking price of $400 million)...not to mention the fact that they are discounting the A380 by such substantial sums now ($400 million down to near $200 million per A380), which means they are losing money on the production of every new A380.

Now with their own A350 that enters the market in 2017, Airbus has offered another alternative to the 787 that permits even lower unit costs than even the discounted A380 at above $200 million a jet.

Airbus made a bad bet. The A380 program was a bad investment for Airbus. The numbers are quite clear, which is why Airbus developed the A350 after seeing its A380 numbers disappoint and watching Boeing's 787 numbers soar. Unfortunately, Airbus loses money on the A380.

The A380 is a wonderfully engineered plane...but not a success in terms of profit and business. That is called a business failure.

Last edited by cblaisd; Aug 28, 2014 at 6:21 pm Reason: Merged posters 3 consecutive posts; removed personal attack and OMNI/PR material
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Old Aug 28, 2014, 12:25 pm
  #149  
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Originally Posted by bhrubin
Airbus made a bad bet in the 1990s that airlines would prefer bigger 4 engine jets.
That's not the bet. The 4 engine part was secondary to the size bet, which drove the engine choice. And they didn't "bet wrong." They simply estimated demand incorrectly: Maybe you should be upset at them for failing to predict the future (including a global economic collapse)?


The A380 is a wonderfully engineered plane...but not a success in terms of profit and business. That is called a business failure.
Yes, and? They're not going out of business. They made a call and got it wrong due to several related and unrelated factors. It happens. I'm not sure why everyone has their knickers in a twist over it - is it really just because it is/was a flagship product at the time of launch? Hardly a shock. Look at at any other company and they will screw things up periodically.
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Old Aug 28, 2014, 12:36 pm
  #150  
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Originally Posted by SeriouslyLost
And they didn't "bet wrong." They simply estimated demand incorrectly
That is hilarious. Airbus DID bet wrong--by the simple fact that Airbus "simply estimated demand incorrectly". Just because you used different words doesn't mean they don't mean exactly the same thing.

Last edited by cblaisd; Aug 28, 2014 at 6:22 pm Reason: Removed unnecessarily personalized, uncivil commentary
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