Official: Britain out of Airbus

[Werner]

I still don't see why one would buy an A380 when the 787's cost per seat-mile is 20% less (empty or not). How can any board of directors justify an A380 except as a pure ego trip, or unless you plan to skimp on maintenance by having engines serviced in Turkey and Airframes in Kuala Lampur like ValuJet.

The only way the 380 makes sense now is if they abandon the 555 seating and go for something like 800 seating. What a delight that'll be.

Remember, the Boeing can be serviced in existing structures; the A380 will require new gates and maintenance facilities. In addition, it has twice as many engines and therefore a more critical maintenance schedule.

Because the passenger load is double the 787 there will be more impetus to keep each plane flying; servicing an A380 is going to be a larger hit on the flight schedule than servicing a 787. Further, many airports like O'Hare, DFW and Harts simply have refused to make the necessary alterations to accommodate the Airbus.

It's interesting that Rolls-Royce scrapped or deferred the tooling for A380 motors to produce equipment suitable for the 787.

[Tracy White]

I could see it at airports running at capacity... while the wake turbulence may stretch out separation, theoretically if your aircraft movements per hour and slots are full, the only way to keep up with growth is larger aircraft. It's quite the investment though and I have a hard time seeing them pushing the airlines to "only" add A380s.... well, at airports outside of France, anyway.

[Werner]

O'hare is in the middle of a project to reposition every runway over the next decade. If you think they have additional dollars to accommodate this Eurobus Pelican, you are sorely mistaken.

They could land at Rockford like the Concorde during it's short, money-losing venture to the US Midwest, but somehow I think an airport 90 miles northwest of O'Hare has lost it's appeal.

[Tracy White]

Well, Chicago already has an impre$$ive record of crappy aviation intelligence. Have you had a chance to enjoy the new Charter One Pavillion yet?*

Quite honestly, the A-380 is a bigger terrorist threat than Meigs was.... but I digress.

* this is not me being pro A-3Ugly.

[Dave Wooley]

The fuel economy of the 787 is the trump card and the more managable payload capacity . Add to the equation the methods of constuction and the materials used , the "Dream Liner" is in a class of its own . The A 380 is the wrong design at the wrong time.
Dave Wooley

[Guest]

So the first B787 to go down will be smashed by the finger of God and not by a design flaw any other aircraft would have survived.

His absolutely certain foresight in aeronautical engineering is amazing. And he derives all that from looking at crushed fossils.


- Chuck

[Werner]

Airbus Takes a Baby Step Forward

It took no less than a summit meeting between the heads of the German and French governments to accomplish, but Airbus and its parent EADS have finally eliminated the ridiculous practice of having matching French and German co-chairmen of EADS and co-presidents of both EADS and Airbus itself. As Spiegel Online International exulted,

• "Now the Franco-Germany company will look more like a normal firm, with a mere one CEO each at EADS and Airbus."

The official EADS press release puts a decided spin on the process, as if Airbus were run by its shareholders and management and no politics were involved, and it was just a coincidence that the summit meeting, held in Toulouse, France where Airbus has its headquarters, happened at the same time as the change:

• "EADS shareholders have decided - together with the EADS management team - to modify the company's current management and leadership structure. Guiding principles of the modification are efficiency, cohesiveness and simplification of EADS management and leadership structure, towards governance best practices and in the respect of balance between the French and the German shareholders. The German Government has been consulted as well."

In fact, the long overdue change is a positive move. But as this organization chart for the new EADS management structure indicates, the balance between French and German executives has been kept, with the chain of command going from a French directuer generale at Airbus reporting to a German President, reporting to a French President at EADS, reporting to a German Chairman at EADS. The little flags that Le Monde thoughtfully provided ont he organization chart tell the story better than any PR release can obscure.

The really hard work remains ahead, continuing the Power 8 cost reduction program (and gaining and maintaining union acceptance of resulting layoffs and plant closures) and engineering the complex new A350XWB wide body twinjet, getting it to market as promised in 2013. Success will leave it years behind the competition, the Boeing 787, which just had its factory roll-out on July 7th. Failure to meet schedule, after the debacle of A380 delays, would be catastrophic.

With a monopoly on fuel-efficient composite-fuselage long range widebodies for almost 6 years, Boeing will not only attract plenty of customers, it will get very healthy margins on the planes it delivers from its bulging order book, the most successful marketing campaign for a new airliner in history. Meanwhile, Airbus will have to cover very large costs associated with bringing a brand new plane to market and mastering the complexities of an aluminum skeleton holding carbon fiber panels for the fuselage barrel, unlike Boeing, which is going with an entirely carbon fiber-based barrel.

Many observers were distinctly underwhelmed by the management changes announced. For all the musical chairs, the players remain the same, just moved about the the organization chart.

• ``I don't think it'll solve anything: It's the same names all over again, and they're just shifting the cards around,'' said Jean Francois Knepper, president of Airbus's European works council, in a telephone interview [with Bloomberg] after the announcement.

Ambrose Evans-Pritchard of the UK Telegraph reports:

• Howard Wheeldon, an aerospace expert at BGC Partners, said: "This does nothing to change the French and German political hold over EADS and its hapless Airbus subsidiary. What Airbus needs is the removal of the politics of destruction."

And:

• Citigroup said Airbus would remain prone to bitter wrangling between Paris and Berlin. "Until the cumbersome shareholder structure is addressed, we continue to expect stalemate over many EADS issues," it said.

Still, it is positive move. But the tensions between France and Germany remain. France reportedly wants to interfere with the European Central Bank to push down the price of the euro, currently about $1.38, which is an enormous handicap to Airbus in competing with Boeing. Germany, ever fearful of kindling inflation, and currently enjoying a trade surplus, unlike France, is resisting. And both countries fear a loss of influence to the other, particularly since cost pressure from a high euro may result in outsourcing more and more production to non-euro locations, including the new A320 narrow body production line in China.

But Airbus has avoided a confrontation and made a positive move toward a rational business structure. Everyone who benefits from vigorous competition in the airliner business (and that includes nearly everyone who flies), has cause to congratulate Airbus. Just a tiny little bit.

[Tracy White]

First Order for A380 in over two years:

BA orders 12 A-3-Uglies; 24 Dreamliners (warning, embeded sound advertisement on page)

[Werner]

It's a shame that the A380 is siphoning profits away from much needed investment in new products and modernization of the Airbus operations. In a private company like Boeing this mistake would certainly prove fatal. Airbus has the advantage of a bottomless source for loans with no obligation to repay or settle at a date certain.

In a very few years the Chinese will be competing in the mid-range commercial jet market. If Airbus has not revamped it's line by then, there will be very little opportunity for them to compete with China, Boeing and new offerings from Embraer. They will essentially cease to be a competitive aircraft manufacturer, and will have to settle with niche manufacturing of a few legacy aircraft.

Every time the cost of oil rises the gap between the A380 and the 787 widens.... The 787 was more cost effective when oil was below $50. Now at $80 and with the possibility of huge carbon taxes looming on jet fuel, the difference between the A380 and 787 is obviously the difference between profitability and bankruptcy.

I wonder if the EU will waive or refund the carbon tax on airlines operating the A380, or if they will revoke Boeing's patents on composite airframe designs in the name of "social responsibility". The EU and the respective governments have a financial and social stake in keeping Airbus going. I wonder how much they will make Americans pay for their mistakes.

As much as I hate Microsoft, it's clear the EU's antitrust actions have been window dressing to tax a US corporation to compensate Europe for it's failure to develop it's own software industry. I am sure they will not hesitate to use this tool against Boeing in the future.

[Mark Petersen]

They could land at Rockford like the Concorde during it's short, money-losing venture to the US Midwest, but somehow I think an airport 90 miles northwest of O'Hare has lost it's appeal.

The northern suburbs of Chicago already have a viable alternative airport besides O'Hare and Midway. It's called Mitchell in Milwaukee. Just a quick shot up the Toolway/I-94. Far less hassle to fly in and out of, parking is way cheaper plus it has an Amtrak stop if you want to go that route. I don't know if any of the airlines flying out of there are bundling train fare and the ticket price but I can't be the first person to think of it. Lake Forrest to Mitchell is around 50 miles

[Werner]

They could land at Rockford like the Concorde during it's short, money-losing venture to the US Midwest, but somehow I think an airport 90 miles northwest of O'Hare has lost it's appeal.

The northern suburbs of Chicago already have a viable alternative airport besides O'Hare and Midway. It's called Mitchell in Milwaukee. Just a quick shot up the Toolway/I-94. Far less hassle to fly in and out of, parking is way cheaper plus it has an Amtrak stop if you want to go that route. I don't know if any of the airlines flying out of there are bundling train fare and the ticket price but I can't be the first person to think of it. Lake Forrest to Mitchell is around 50 miles

Yes... my last several flights have been from Mitchell. I really love Midwest Airlines.

I can spend 35 minutes or more driving to O'Hare, then an hour through the terminal mess to wait for a plane which is almost always late, or I can drive 55 minutes to Mitchell, then no more than 15 minutes to check in and then I'm at the gate for an airplane which will depart on-time.

All day parking is attached to the main terminal and is cheaper than O'Hare, too. Don't have to take a train to a distant lot. It just makes sense to avoid O'Hare. It's too crowded.

[Werner]

On their website today:

[L]arge jets, such as Boeing's 747 and Airbus's A380, will make up less than 1% of new deliveries, according to the projections.

But Airbus is not positioned to be a player for the other 99%. What does that say about their management?

[Werner]

http://www.humanevents.com/article.php?id=22713

Uncertainty regarding the stability of Airbus as a result of the A380 debacle may scuttle their opportunity to win the giant KC-X program with the USAF.

[Dave Wooley]

Its has been officially confirmed by Boeing that they are experiencing serious delays on the 787 which are centred on the fastening clips for the carbon fibre fuselage sections. This delay has the potential to fuel a raft of compensation claims. As a result of this unfavourable news Boeing shares fell have fallen around 3%.
Dave Wooley

[winstonshu]

6 month delay for the dreamliner. good news for airbus i suppose, but that still doesn't make the 380 any less of an albatross.

[ar]

I have read the variuos posts with interest.
Airbus WILL be a success, it's a case of BUMS ON SEATS. More specifically 800 tiny Asian bums. The aircraft will be the successor to the old 747. Long haul/global flights. JFK has already replaced the two overpasses with new ones to take the aircraft as has Heathrow, others I am sure have already done so with others to follow.
No room for more flights at Heathrow, answer, bigger planes. JFK is constantly expanding, a perpetual construction site.
Number of international passengers is estimated to double within eight years. I can see Korean flights cramming 900 BUMS ON SEATS. The mind boggles. The biggest problem will be, (and I speak from personal experience) how to get a cab coming out of JFK at 4pm. It's difficult enough now. There won't be enough cabs in all of NYC, believe me.
And those airports that are not going to expand to take the Airbus will later on wish they had.

[hood]

to add my twopnnys worth i think a lot of american opposition to the new 380 is the fact that boeing have got caught out . 380 will suceed airbus will carry on but boeing are behind the times 747 is old design , the future is bigger planes less slots carbon emmisions will leave airlines wanting to max long haul flights.

[winstonshu]

someone needs to tell the airlines that, then - how many orders does airbus need to get in order to break even on this project, much less turn a profit?

and how many do they have?

[ar]

someone needs to tell the airlines that, then - how many orders does airbus need to get in order to break even on this project, much less turn a profit?

and how many do they have?

Have no idea, but with a doubling of long haul global traffic, then it has to be the Airbus, simple as that. Asian trans Pacific and over the pole flights, millions of tiny bums, and wait until the Chinese get into the international traval act in a big way, think about it. Oh, and I forgot the Russians. Bums on seats, more seats then more bums.
PS out of tiny interest, just how many seats can be crammed into the A380? With small people in mind of course.

[winstonshu]

someone needs to tell the airlines that, then - how many orders does airbus need to get in order to break even on this project, much less turn a profit?

and how many do they have?

Have no idea, but with a doubling of long haul global traffic, then it has to be the Airbus, simple as that. Asian trans Pacific and over the pole flights, millions of tiny bums, and wait until the Chinese get into the international traval act in a big way, think about it. Oh, and I forgot the Russians. Bums on seats, more seats then more bums.
PS out of tiny interest, just how many seats can be crammed into the A380? With small people in mind of course.

i don't know about your sardines in a tin vision for air flight, although admittedly that may sell more 380s than airbus is currently managing. regardless, although your vision may hold merit in the super long haul type flights like transpacific flights, i think that boeing's vision of the true growth market for airline flight being the short(er), lower passenger number but higher frequency flights between stops in asia is the most valid one.

as to how many sardines you can cram into a 380, i don't know if there's been a serious number that airbus has willingly tossed out yet (they're still trying to sell on luxury), but the number i've heard tossed around is something horrifyingly claustrophobic like 800.

btw, please stop referring to us asians as people with tiny little bums. my fat ass is at least larger than average. asians aren't as small as you think.