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Airbus to scrap A380 superjumbo production as sales slump

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Airbus to scrap A380 superjumbo production as sales slump

By Tim Hepher

 

2019-02-14T052822Z_3_LYNXNPEF1D099_RTROPTP_4_AIRBUS-A380.JPG

FILE PHOTO: An Emirates Airbus A380-800 aircraft takes off from Manchester Airport in Manchester, Britain September 4, 2018. REUTERS/Phil Noble/File Photo

 

TOULOUSE, France (Reuters) - Europe's Airbus is scrapping production of the A380 superjumbo, with lackluster sales forcing it to abandon a dream of dominating the skies with a 21st century cruiseliner.

 

The world's largest airliner, with two decks of spacious cabins and room for 544 people in standard layout, was designed to challenge Boeing's legendary 747 but failed to take hold as airlines backed a new generation of smaller, more nimble jets.

 

Airbus said on Thursday the last A380 would be delivered in 2021.

 

The shake-up came after Emirates - the largest A380 customer - decided to reduce its orders for the iconic superjumbo and order a total of 70 of the smaller A350 and A330neo instead.

 

"It was a painful decision for us. We have invested a lot of effort, a lot of resources and a lot of sweat...but obviously we need to be realistic," Airbus Chief Executive Tom Enders said.

 

Airbus said it would enter talks with unions in coming weeks over the 3,000-3,500 jobs potentially affected.

 

It took a charge of 463 million euros for shutdown costs, but is expected to be forgiven some 1 billion euros of outstanding European government loans under a funding system that stands at the center of a trade dispute with Boeing.

 

Airbus will produce 17 more of the planes including 14 for Emirates and 3 for Japanese airline ANA.

 

As part of the restructuring, Emirates placed a new order for 40 A330-900neo jets and 30 A350-900 aircraft, partially restoring a purchase of A350s which it canceled in 2014.

 

Responding to behind-the-scenes concerns from airline customers from Asia to Europe, Enders stressed Airbus would continue to support the A380 as long as it remains in service.

 

LEADING BUYER 'DISAPPOINTED'

Emirates, which had built its global brand around the A380 and Boeing 777 and which also has 100 of the Airbus superjumbos in its fleet, said it was disappointed by the closure.

 

"Emirates has been a staunch supporter of the A380 since its very inception," said Emirates Chairman Sheikh Ahmed bin Saeed al-Maktoum.

 

"While we are disappointed to have to give up our order, and sad that the program could not be sustained, we accept that this is the reality of the situation," he added.

 

The decision came after Emirates failed to reach an engine agreement with Britain's Rolls-Royce, which said on Thursday it noted the decision to shut down the program.

 

The A380 will remain a pillar of the Emirates fleet well into the 2030s, the airline said.

 

Emirates' local rival Etihad of Abu Dhabi also disclosed it was cutting some Airbus and Boeing jet orders, highlighting growing questions over the growth of Gulf airlines.

 

Making its maiden flight in 2005, the A380 was a major step in Airbus's efforts to compete on equal terms with Boeing and challenge what had been a cash cow for its arch-rival.

 

But sales of the industry's largest four-engined jets have fallen due to improvements in lighter twin-engined alternatives, such as the Boeing 787 and 777 or Airbus's own A350.

 

The prospect of a premature halt to A380 production emerged last month as part of a restructuring of orders first reported by Reuters.

 

On Wednesday, Reuters reported that Airbus was poised to axe the superjumbo and would likely give an update on Thursday.

 

The decision to scrap production is the last major step by Enders, who steps down in April.

 

(Reporting by Tim Hepher; Editing by Sudip Kar-Gupta and Alexander Smith)

 

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-- © Copyright Reuters 2019-02-14

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Yeah, deciding to try to compete with the B747 even as Boeing was cycling the program down was foolish. 

 

 

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Crying shame, really. The A380 is a great experience in flying: quiet, smooth, roomy. I really hate the loud B777 you get to fly on the same long-haul routes. Definitely my main reason for choosing Emirates or Etihad (when they fly it over one leg of the Europe<->Thailand trip at least) over other companies.

Weird for Emirates to be "disappointed" since their cancellation of the outstanding order is the main reason for the shutdown. They basically killed it.

Edited by Lannig

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11 minutes ago, Lannig said:

Crying shame, really. The A380 is a great experience in flying: quiet, smooth, roomy. I really hate the loud B777 you get to fly on the same long-haul routes. Definitely my main reason for choosing Emirates or Etihad (when they fly it over one leg of the Europe<->Thailand trip at least) over other companies.

Weird for Emirates to be "disappointed" since their cancellation of the outstanding order is the main reason for the shutdown. They basically killed it.

At some point, even Emirates can't continue hemorrhaging money.

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3 minutes ago, impulse said:

 

If they're set up correctly, most planes are very comfortable.  The discomfort comes when the airlines try to squeeze in more seats by reducing legroom and decreasing seat width.

 

I'm old enough to remember when one of the selling points of the 747 was a piano bar in the top lounge.  Of course, that was before deregulation when it cost a year's salary to fly to Asia, and a week's salary to fly cross country, and people bought their tickets based on service and comfort because they all charged the same fares.

 

Nowadays, we vote with our money.  Sadly, most people (myself included) vote for cheap seats.  Eventually, they would have figured out how to pack more butts into the A380 and make them into cattle cars, just like they have done for the 747's.  If they had been able to sell all 800+ passengers that could fit into the A380's, they'd still be buying them and packing us in like sardines.

 

 

This is true. A380 become less comfortable when you rearrange the seats to squeeze two more rows in to pay for the huge amount of fuel it consumes.

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Sad, wonderful plane, silent … I was lucky to travel with it several times from Europe to BKK 

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3 hours ago, SheungWan said:

Now that the A380 is removed from the BKK-HKG and BKK-SYD routes I guess that's it for me. 

So you'll quit traveling? A little harsh isn't it?

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4 hours ago, SheungWan said:

Now that the A380 is removed from the BKK-HKG and BKK-SYD routes I guess that's it for me. 

 

1 hour ago, Yellowtail said:

So you'll quit traveling? A little harsh isn't it?

Ha-ha. 

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The A 350 looks like being the new competition to the 777 which has been (& still is)

very successful & great to travel in even in cattle class as long as they do not do what Emirates did & configure an extra seat  in the middle. For long haul it just makes it too cramped.

The sheer internal volume of the A 380 makes it a pleasure to fly in though

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14 hours ago, Cryingdick said:

The A380 was one of the dumbest corporate blunders in history. 

And Emirates dumbest corporate blunder for ordering so many. Going to be very hard to off-load the A380 in the years to come as there is no second hand market. SQ's first two aircraft have ended up as spare parts and scrap metal.

Big twins are the future of commercial aviation.

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Passengers do like the a380. The problem is, as with the a340 before it, the airlines hate it. It didn’t come close to the efficiencies and lifting capability it was promised by airbus. I’m surprised it lasted this long.

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