Boeing beats Airbus... again!

Here is more to understand the 787 decision what is likely the bigger story on the delay in closing the re-order of A380s.

DUBAI - Emirates is rejecting the proposed Airbus A380plus concept in spite of its plans to continue ordering more of the largest commercial aircraft.

“We would rather they just offered us the continuation of the line,” Emirates Airline President Tim Clark said at the Dubai Airshow. “I have never been a big fan [of the A380plus].” Key features of the proposed upgrade include the removal of the large forward staircase and an eleven-abreast cabin in the economy section, both of which Emirates will not take. Emirates is also not insisting on a commitment by Airbus to eventually re-engine the A380 as a prerequisite for a new order.

Both parties planned to announce a major deal at the Dubai Airshow this week, but the process was derailed over what guarantees for the continuation of the program could be given. Industry sources said it was still possible, but not very likely, a deal could come through this week.

“The undertakings Airbus will have to make is that the line will continue for 10-15 years and that a further commitment [by Emirates] would not be at risk,” Clark said. The government of Dubai needed absolute certainty that Airbus will continue building the A380 for that timeframe before it commits to a further order.

Emirates currently operates 100 A380s and has 42 more on firm order. Clark did not say how many additional aircraft the airline may buy, some reports suggested the number could be similar to Emirates’ current order backlog for the type.

Airbus’ total A380 backlog now stands at 100 aircraft, but most of the non-Emirates orders are no longer expected to materialize. Airbus is reducing output to 12 aircraft a year in 2018 and eight in 2019. The manufacturer wants to keep production at seven or eight aircraft per year for several years until demand for the type from other airlines picks up and the rate could be increased. Airbus has made a profit on a recurring cost base at a rate of 15 aircraft per year and is trying to drive breakeven down further. However, it is acknowledging that production will be loss-making at eight per year.

“The ownership [of Emirates] is well aware of the dearth of orders,” Clark said. Airbus wants Emirates to take delivery of aircraft across the entire timeline of guaranteed production years. Depending on the size of the order Emirates will place, that would leave Airbus having to fill open production slots each year over an extended period of time. Clark, however, argued that the current Emirates order makes sure “the program is sustained until the middle of the next decade anyway.”

Should Emirates go ahead with an additional order, it would talk to both engine manufacturers - the Engine Alliance and Rolls-Royce – about equipping the aircraft. The remaining 42 aircraft on firm order are powered by Rolls-Royce Trent 900 engines as are ten of the 100 in service.

According to Clark, Boeing’s proposed new midsize aircraft (NMA) could be an option for both Emirates and FlyDubai. In Emirates’ case, it could be used to increase frequencies on existing routes or for new markets. “But it is not yet at a stage where it is offerable,” he said.

The 40 Boeing 787-10s Emirates ordered earlier this week are “perfect for 7-8.5 hour missions.” Emirates plans to fly them in a 280-seat three class layout. The airline also considered the A350-900, but was not happy with some aspects of the interior configuration. Only in early November Airbus showed a new layout with the rear pressure bulkhead moved aft by 2.5 feet. Clark complained to Airbus that the design should have been on the table earlier because it could have changed the picture completely. But by that time the commitment to Boeing had already been made.

Clark predicted that enhanced cooperation between Emirates and FlyDubai will generate up to ten million incremental passengers for Emirates per year. He dismissed the idea that Emirates may be better off focusing on smaller widebodies than the A380 such as the Boeing 777-9. “If you start compressing, the hub implodes.” But using a large and growing fleet of A380s “creates huge flows across the network.”

 

According to Aviation Week, it is not even as simple as that. Emirates is also looking for a price reduction on the A380s, but Airbus, with reduced production because nobody else is ordering the A380, is afraid they will lose money on every one they build. In a chicken and egg scenario, Emirates is afraid Airbus might pull the plug on the A380 since it would make very little, if any, on every one built, so they do not want to rely on an aircraft that may go away. The embargo on Qatar has potentially hurt A380 sales, too, since, Qatar Airways was a potential customer currently banned from many Gulf airports and airspace.

The A350 has been playing catch-up with the 787 for a while, and actually costs more to build, so no surprise there. Boeing outplayed Airbus big time on this one.

 

Some sources around me are saying that Airbus might outplay Boeing really big in a very short time...stay tuned.
Rgds

 

Well, here are the 49,5 billions that should make you reverse the thread title..."Huge win for Airbus over Boeing" would be more appropriate, isn't it?

http://www.independent.co.uk/news/business/news/airbus-record-deal-indigo-partners-430-planes-a320-aviation-manufacturers-a8055636.html

Rgds

 

http://ca.reuters.com/article/businessNews/idCAKBN1DF0M1-OCABS

 

I think on narrow bodies Airbus did have the upper hand with the A320 series as Boeing should have made an all new 737 back in the late 1990's. On wide bodies Airbus you have to admit made a strategic mistake with the long haul 4 engine philosophy and building the A380. They had to rush around and design the A350 when they finally figured out their big error.

 

I remember having a three-days training session on "innovation" when the A-380 project was launched, in 2005 or 2006 if my memory, etc...I'm not working in the aviation world at all, and the seminary was not about aviation either, but the plane was taken as an example of innovation. I was strongly opposing this: I told them that it was only "a bigger plane again", but that there was nothing new in the project, and that I doubted it would make any breakthrough, and that I doubted there was a market for it. And that Airbus already has made a market mistake with another four-engine plane, the A-340.
I was frowned upon as being an old-fashioned mind, an ignorant, and what have you. Well...not that I am happy to have been right, but...

Rgds

 

It would be more accurate on the A350 that it wasn't Airbus that figured out the error in the original design but that Udvar-Hazy (ILFC) forced them to make a new design aircraft when he publicly ridiculed and refused to order the first version which was a derivative.

As for the monster Indigo order there seem to be some questions on how firm all of those aircraft orders are. Seemingly it is only an MOU at this stage covering 4 different ultra low cost airlines that Indigo is invested in. For some it is a doubling of fleet size.

Personally I have a bit more faith in the solidness of the Fly Dubai 737 Max orders that Boeing announced. Not as large of order as the Indigo but probably a firmer transaction.

 

What are the differences and or benefits of the 787 vs A350.

 

I had heard that what is now the 737 MAX was originally supposed to be an all-new airplane with a wider fuselage and 2-2-2 coach seating, but that Airbus forced their hand by announcing the A320neo. Boeing had neither the time nor money to develop a new airplane, and needing a quick answer to Airbus is why we have the MAX instead.

 

I heard stories that the replacement 737 had been designed/defined in the mid 2000 - 2010. Story went that it was to be the project after the 787.

But the 787 did not go nearly as smoothly as a development and possibly gave new insight into what real world $ for the composites should be versus the hoped for numbers.

In all the intervening years Boeing has made public statements about the possible 737 successor. One item they stress is that whenever the aircraft is done it will have to deliver a major operating cost (trip cost/seat mile cost) reduction beyond what the Max could achieve with new engines and some assorted tweaks.

As one listens to the Boeing discussions on the new Middle of Market (MOM) aircraft a lot of this comes into play again. Operating cost coupled with acquisition cost. That is leading to comments that being composite like the 787 gets the cost per aircraft too high. The statements also keep showing the fight between twin aisle versus single aisle operational costs - twin aisle equals larger cross section = more aerodynamic drag. Consider that MOM is already set to be at a higher price area than the 737 is in.

 

I think that this is an Airbus smoke and mirror act. I read where Frontier is going to get 134 planes yet they only have 73 in there fleet with 5 more on order. Frontier is trying to increase there market by flying into more cities but I cannot see them needing 200 aircraft. Also with a fleet age of average of 6 years it is not like they are renewing there fleet anytime soon. Sorry Airbus the numbers don't add up.

 

2-2-2?

 

2-2-2 = 2 seats on the left, LH aisle, 2 seats on centerline, RH aisle, 2 seats on the right. The problem with 2-2-2 is that the aircraft width grows by 30" with no extra passenger revenue. Coach passengers might like it but the cost of operation doesn't. 2-3-2 would make it grow another 17.5" so a total width increase of near 48". This is all part of what Boeing is having to weigh as they get to the final definition of the new Middle of Market aircraft. There is some speculation that part of this consideration of they go twin aisle may include an elliptical cross section instead of the normal round.



More on understanding the non-order by Emirates of the A380:

The Dubai Airshow has provided the big surprise of the week. Rather than place an expected order for 30+ Airbus A380s, Emirates ordered 40 Boeing 787-10s. Emirates made things worse for Airbus by making its demands clear: It would only place an A380 order if it received a 10-year production-line guarantee. This put Airbus in a very difficult position.

Yet Emirates’ request for a line guarantee means little because the A380’s future is determined by Emirates, not Airbus. The airline received its 100th A380 this month. It took its first A380 in July 2008, so it has averaged 11 deliveries per year. But in July, Airbus announced production would be cut to just eight A380s in 2019. Emirates still has 42 A380s on order, and it isn’t willing to take them at a rate that would allow Airbus to keep the line alive without losing millions of euros on each aircraft it delivers.

Emirates is understandably ambivalent about this situation. On the one hand, it has linked its brand with the A380. And since it wants to keep its fleet young, it needs to sell its A380s to some kind of secondary market. Closing the line would damage the prices it could get, particularly since there has not yet been any kind of demonstrated secondary market for the A380.


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On the other hand, changes to the carrier’s business model are forcing it to adjust fleet strategy. Fare-pricing pressures and slowing growth rates have led Emirates to emphasize profitability over volume and market share. This means more midsize long-range twin-aisles (the 787-10s plus the 150 777-9s it has on order). The new generation of long-range twin-aisles (these Boeing jets plus Airbus’ A350XWB) offer seat-mile costs that are 5-8% lower than the A380’s.

Those 500+-seat A380s look increasingly like anachronistic relics from Emirates’ glorious, fast-growth years, when A380s were useful in making the most of every slot it could get, even in markets like Birmingham, England, or Dusseldorf, Germany.

Meanwhile, nobody else wants the A380. It has been five years since the last non-Emirates A380 order (All Nippon Airways is a new customer, but only because it was forced to take three aircraft ordered by Skymark, whose assets it coveted). In March, Emirates rival Qatar said it wouldn’t buy any more of the aircraft.

While Airbus’ website lists 56 orders beyond the 42-jet Emirates backlog, only nine of these are actually firm orders. The other 47 are speculative or are for airlines that no longer intend to take any A380s, such as Virgin Atlantic. Some of these 47 non-orders, such as Amedeo’s, account for the aircraft shown in recent years in our graph.

The new Emirates order can still be salvaged. For both sides, kicking the can down the road holds strong appeal, at least in the short run. Emirates wants to keep its flagship going for as long as possible and avoid making tough decisions about the future of its fleet. Airbus and its suppliers want to avoid the write-offs and loss of face that would inevitably accompany a program termination.

But guaranteeing a production line for 10 years is a difficult demand. To do that, Airbus would need to really believe that the A380 has some kind of future outside Emirates, despite all the trends that clearly indicate the market thinks otherwise. Meanwhile, Airbus will need to continue losing millions of dollars on each A380 it delivers to one customer, which may or may not be willing to go back to 11-per-year acceptance rates.

If Airbus guarantees the line and then finds it too painful to keep going after five years, it will face demands for compensation from Emirates, whose A380 residual values would decline as a result of the line closure. That could easily run into the hundreds of millions of dollars, above and beyond the lawyers’ fees.

No matter which path is taken, the November 2017 Dubai Airshow will be remembered as the week that precipitated a tough decision for the A380: A merciful death with considerable up-front losses or a lingering death with greater losses spaced out over a much longer period of time.

Contributing columnist Richard Aboulafia is vice president of analysis at Teal Group. He is based in Washington.

 

I'm guessing the A380 is considered inferior to the 747 as a cargo plane because of the lack of a hinged nose? The guys at Boeing who moved the flight deck upstairs in order to accommodate the hinged nose look like geniuses now.

 

Yes, I know what 2-2-2 means... but the plane is 3-3 now... what's the advantage in seating numbers? Seems silly to even talk about widening for 2 aisles with still only 6 seats/row.

 

Hinged nose is only one aspect. The clear height on the main deck is far taller too. The 747 was designed so there could be a freighter version built by Boeing and the aftermarket has followed by offering conversions.

The A380 was not designed to have a freighter version. Apparently there is some issue on the structure being able to take the same per sq/in. floor loading that is needed for the cargo world. As such just adding some big side cargo doors like the 747 and other freighters have would not solve the issue. For Airbus to make the freighter viable would require them to spend new money for a dying airframe with negligible sales prospects.

The 747-8 is essentially dead as an airliner. Boeing is still expecting a pick-up for it in dedicated cargo. But, they have been telling that story for a while now so there is a question of how long they will wait until their patience runs out.

 

The front cargo door really is only a small part as a good % of the 747F's have a normal nose. The weight of the second floor on the A380 and the main floor not being as strong due to the upper floor being part of the structure make the A380 only a small package freighter. FedEx had ordered the A380F but then cancelled the orders. I would be surprised if Airbus did a new fuselage with a single deck on the A380. The program is already going to end up being the BIGGEST airliner failure in modern history. Maybe in 15 years Airbus will come up with a 2 engine A380 type aircraft so they can say they were way ahead of their time. By that time they might come up with a big enough engine that is reliable enough to make it work.

 

The A380 was a nice idea, but didn't pan out well in terms of passenger transport and cost-basis. Among long haul flights, it only gets 74mpg per seat. Older 777 models get 76mpg and the 797-9 in 304 seat configuration get 102.

Obviously there are other costs other than fuel when comparing two vastly different planes like the A380 and 787, but I think the A380 pigeon holed itself into a market that doesn't really exist outside government-funded airlines.

I pulled the fuel #s from here (you can sort them at the top of each column): https://en.wikipedia.org/wiki/Fuel_economy_in_aircraft#5.2C000.E2.80.937.2C600_nautical_miles_.289.2C300.E2.80.9314.2C100.C2.A0km.29

 

The A380 has too much unusable floor space and volume to make a good freighter. Maybe it would be okay to carry 5 million ping pong balls.

 

Easier ingress and egress, for one thing, and potentially a lifesaver if a rapid evacuation is needed. Also probably more total overhead bin space. Everyone being either on an aisle or at a window would certainly be attractive for passengers.

 

But none of those are reducing the cost of operation for the airline. In fact it is increasing the cost of the aircraft build and the operating cost as the aircraft is making a bigger hole in the sky.

 

Airbus's ego may think that but in reality all Airbus did was take the MD-12 concept expand it a little then slap on more powerful turbofans than what were available in the late 80's and early 90's when McDonnell Douglas was kicking the idea around .

https://en.wikipedia.org/wiki/McDonnell_Douglas_MD-12

 

For max volume the aft side cargo door must be used. Loading through the nose has height restrictions, 9 ft vs 10ft aft of the upper deck. Best asset of the nose door is loading long cargo that could not be angled through the side door.

As F1tommy noted FedEx was the launch customer for the A380F. They ended up cancelling the order, however that was before the A380 was certified for pax. So it was indeed being designed as a freighter.

It has always been standard practice to reinforce the floors to carry way more than normal operations, for those times when heavy freight capacity is needed. Avg cargo density has actually dropped quite a bit in the last decade, and many times a freighter will volume out before weighting out. Because of this change in density, brought about by the explosion in e-commerce (Amazon/Alibaba/etc), it is no longer a necessity to reinforce the floors to near the same levels. Also, because of the double deck on the A380 the height, and thus total volume, of any container is less than the max on a standard freighter which means the area loading is less which means the existing structure does not require strengthening (or much less).

Not sure how you come to that conclusion. Total available volume on an A380 is greater than a 748. Might require new container shapes, but netted pallets are currently configurable in any contour you want.