New problems for the Airbus A380

CX · Post by CX » 21 Sep 2006, 11:31

I dont' know where you found out that A380 has worst cost/seat or weight per seat than the 748, in fact an article posted in some topic in this forum recently showed that a 748 with 500 seats will have slightly better cost/seat than a 555-seat A380, but 'ever so slightly', while Airbus only needs to add another row of seats to better it.. And just think about how SIA can live with less than 500 seats in their A380s...

Let's see what Lufthansa will do, whether they go for 748s or more A380s..

PYX · Post by **PYX** » 21 Sep 2006, 19:12

chornedsnorkack wrote:
PYX wrote: The 747-xxx entered service in January 1970.
The 747-XXX has not entered service. It has never taken off. The airframe is not airworthy and the engines are mockups. The flight scenes in Casino Royale are presumably fakes.

Sheezzzzzzzzzzzzzzzz
How about "-xxx" standing for, that is, meaning "-100."
Get it?

Ruscoe · Post by **Ruscoe** » 22 Sep 2006, 01:59

[quote="CX"]I dont' know where you found out that A380 has worst cost/seat or weight per seat than the 748,

You can just do the calculations and find out it is the case with regard to weight; as for seat costs that is very contentious and depends how it is calculated.
However the point I was trying to make is that the 380 should not be close or even minimally better, it should be a lot better than an aircraft designed 30 years before, which is the basis of the comment that the advantages of the 380 come from it's size not it's technology.

In the longer run, I think the 380 can be moderately successfull but it will do it by filling with a lot more pax than 555, and it will be no more comfortable than any other jet. If a carrier can put 650 pax in a 380 and sell them, it should be a real cash cow.

So I agree with your comment about putting in more seats to fix the weight/seat cost problem.

Ruscoe

David747 · Post by **David747** » 22 Sep 2006, 04:33

You can just do the calculations and find out it is the case with regard to weight; as for seat costs that is very contentious and depends how it is calculated.
However the point I was trying to make is that the 380 should not be close or even minimally better, it should be a lot better than an aircraft designed 30 years before, which is the basis of the comment that the advantages of the 380 come from it's size not it's technology.

The advantage of the A380 is its sizes and technology. The A380 will be a more efficient airliner than the 748. Technology and size put aside, I'm afraid that there isn't a big market for this plane. I hope I'm wrong, but it seems that planes like the A350, B787, B777LR are the planes where there is a market for, and bigger market than planes like the A380 and 748.

cageyjames · Post by **cageyjames** » 22 Sep 2006, 05:43

David747 wrote:Technology and size put aside, I'm afraid that there isn't a big market for this plane.

While I don't believe in the vision of the A380, I do think there is a market for it. While we probably won't see even a quarter of the 777 in sales, Boeing should have pushed their next version of their large aircraft much sooner and it should have been a total redesign, rather than this 748. If the 787 showed us anything, it is that technology can sell a totally new aircraft and Boeing should have been the one no Airbus trying to push out a new very large aircraft.

I still think the 748 is a worse response to the A380 long term than the A330-200Lite was to the 787. Of course no one should be surprised that sales of the 748 aren't that good as Airlines want a new aircraft, not a rehash of a 35 year old airframe. In the end, I don't see how the 748 will do anything more than replace older 747s that airlines don't want to deal with a whole new aircraft such as the A380. McDonnell Douglas was able to sell 200 MD-11s and I doubt Boeing will even sell a quarter of that.

A smart Boeing should push the 777 models, focus on getting the 787 out the door and then move forward with the replacement of the 737 and eventually the 777. Then again, what do I know. My airline buys Airbus and mostly narrowbody models at that.

CX · Post by CX » 22 Sep 2006, 08:00

Well if there is a big market for planes like 773ERs now, in 10 year's time or something, routes that uses 773s/A346s will probably grow so that they will fill 555 seats, instead of the ~300 now. So whether there is a market, depends on how quickly air travel grows... Also while we all say we woudl rather direct p2p rather than transferring at a hub, i don't think airlines care much, and i don't think we would care much if a transfer with a few hour's wait can save you 20% on your ticket!

Bracebrace · Post by **Bracebrace** » 22 Sep 2006, 11:04

If you compare today's 747-800 with the A380, it's logical that on a comparison based on fuel efficiency they will give approximately the same outcome. Don't forget that if you compare date of start of design, the 748 is "more modern" than the A380 (I don't have the actual dates).

If you go into cost calculations, as Ruscoe has said, there's a lot more you can take into account (can be pro or con the aircraft in question of course).

cageyjames · Post by **cageyjames** » 22 Sep 2006, 15:24

Bracebrace wrote:Don't forget that if you compare date of start of design, the 748 is "more modern" than the A380 (I don't have the actual dates).

While that may be true, I think history shows us these minor updates to exisitng airframes just don't result in strong sales.

DFW · Post by **DFW** » 22 Sep 2006, 17:25

The 747-8 doesn't need to generate strong sales to be considered successful. It was meant to cover a niche between the 747-400 and A380, as well as replacements of 747-400 for customers who don't want to change airframes. It lowers the profit margins of A380 sales by being a competitor, at the lower end anyways. The freighters are selling decently because cargo operators don't want to wait until all airports are modified for A380's. All this for a modest investment. If the cost of a brand new superjumbo is around 13 billion euros (as it is with the A380), Boeing would have never recovered that investment even if it gained half the market share of superjumbos. Nor would Airbus recover its investment if Boeing hadn't blinked.

There's nothing wrong with updating a 35 year old airframe. Some very good improvements can be had at modest development costs, keeping the unit costs down. Whereas applying "quantum leap" technology can mean more improvement, but at higher development and therefore unit costs.

RC20 · Post by **RC20** » 22 Sep 2006, 22:13

teach wrote:
It is this kind of "paying buyers to buy our product" nonsense that turn fuels my dislike of Airbus.
What a pile of crap. This is in no way 'paying buyers to buy the product', it's paying the contractually agreed compensation for being late with the deliveries. If Boeing is late with their deliveries, they have to do the exact same thing. Just ask the airlines who had Boeings on order in the late 1990s when Boeing's quick production ramp-up turned ugly and they fell behind on deliveries.

This is normal industry practice and has absolutely nothing to do with Airbus.

Teach,
I hate to bust a bubble, but the well regarded IAG blog has state the same thing. I will grant the original intent was not to make money by not flying the bird.
But now it is turning into a nice cost generating center. Malaysian only reason not to cancel is the payments they are getting. If Airbus can firm up their delivery schedule, and they have to come up with the cash to pay for them, you will see cancellations.
In this case it does have to do with Airbus, because they have lied about the status of the project.
And if you read Av Week, you will note there is an ongoing debate about the use of aluminum wire in the aircraft.
And while it can be made to be as reliable as copper, it does take special procedures to do so. With copper a minor deviation from standard is not going to cause a problem. With aluminum it will.
So, the question has to arises, if you are in a hurry, and your efforts fail to meet the requirements, you are going to have serious problems. If there was a program in crisis, it’s the A380 project.
There is also a serious contention that Emirates does not need the A380 it has on order. There are too many carriers in that region that have no indigenous market, and they are running out of others pockets to pick. Suddenly to put that much excess capacity in the region would be ruinous.
So, you could see orders being cancelled there. Stay tuned.

David747 · Post by **David747** » 23 Sep 2006, 04:20

RC20 wrote:
I hate to bust a bubble, but the well regarded IAG blog has state the same thing. I will grant the original intent was not to make money by not flying the bird.

What Teach posted was right, Airbus has a contractural obligation to compensate for delays, just like Boeing does, what is the controversy with that?

In this case it does have to do with Airbus, because they have lied about the status of the project.

Exactly how has Airbus lied? Any evidence to back up this charge? Airbus, just like any airframe manufacturer has run into some production problems. If Airbus knew that the wiring of the A380 was a problem before hand, I guess they lied, but you need to provide evidence they new.

And if you read Av Week, you will note there is an ongoing debate about the use of aluminum wire in the aircraft. And while it can be made to be as reliable as copper, it does take special procedures to do so. With copper a minor deviation from standard is not going to cause a problem. With aluminum it will.

Right, and if you keep reading the article, iAirbus has already identified the areas it is having problems with, maybe you should point that out, and that this further delay will be used to once and for all get the wiring in place. The debate whether copper is used or aluminum is over already, Airbus is committed to using aluminum, and as I already posted, they have identified the areas they are having problems with.

http://www.aviationnow.com/avnow/news/c ... S09226.xml

So, the question has to arises, if you are in a hurry, and your efforts fail to meet the requirements, you are going to have serious problems. If there was a program in crisis, it’s the A380 project.

Hmm, I dont' understand the basis for that utterly ridiculous statement, but Airbus was not hurrying the project, infact, they were on schedule before the wiring problems arose.

There is also a serious contention that Emirates does not need the A380 it has on order.

Why did they order the plane in the first place if "Emirates does not need the A380 it has on order?"

There are too many carriers in that region that have no indigenous market, and they are running out of others pockets to pick. Suddenly to put that much excess capacity in the region would be ruinous. So, you could see orders being cancelled there. Stay tuned

Emirates didn't order the plane for indigenous market, they bought it to expand their long haul foreign market, remember, there are more foreigners in UAE, than there are citizens of the all the Emirates, and therefore, the strategy of Emirates Airlines is to cater to that foreign costumer base.

CX · Post by CX » 23 Sep 2006, 10:56

What the hell? Order A380s while they dont' need it? I'm sure in the contracts cancelling orders will cost the airline something... While they did order 43 A380s or so, these will be delivered at a rate of maybe 2 or 3 per year initially since they can only get 7 out of the factory per year in the next year or two, so we're talking about a 8-10 year delivery schedule that Emirates has.. i dont' see how that is a 'sudden' increase in capacity.. And even so, their routes dont' even base on middle east, like their flights from Dubai via Melbourne via Sydney to Auckland, doesn't really target the middle east market anyway, and they can bring out many more of these routes..

Ruscoe · Post by **Ruscoe** » 23 Sep 2006, 14:45

[quote="smokejumper"]In designing a plane, the designers try to minimize weight to maximmize the economics.

This is where first went wrong with the 380 . Apart from any production problems now, when the 380 was first envisaged it was to carry 555 pax the same distance as the 747, with 15% better economics at a MTOW of 471T.
This grew to 476T in 1998, but between then and launch the weight had grown to 560T for essentially the same mission.
This is the point where someone (the shareholders) should have called a halt, but because Airbus does not have a broad shareholder base, (nor does EADS), the project continued.
At 471 T the 380 would have had no rivals, an updated 747 could get no where near it, nor could the 350 or 787 eat into its market. but at 560+T it is just not that far ahead to ensure the success that a $15 billion dollar project should have.

To say these things is not ant Airbus it is pro Airbus because something needs to be done with the structure of the organisation, to make sure it does not happen again.

Ruscoe

bits44 · Post by **bits44** » 23 Sep 2006, 21:22

Richard Aboulafias advice to Airbus:

Dear Fellow Stunned Observers,
Mapping failure in our industry is easy. Aircraft fail due to technical reasons or market reasons or both. Technical failures include the A-12 and the Comet 1 jetliner. Market failures include the 717, F-20, and Concorde. Finding combinations of both types of failure is rare. Most of these get quashed before they leave the drawing board—like Sonic Cruiser. You need to search history for aircraft that represented both types of failure, like the Spruce Goose. I’ve always thought the A380 would be a market failure. But we might be witnessing an unusual dual market and technical failure.

What’s bizarre about the recent Airbus A380 announcement is its excuse. “Some wires are tough to install. So production will be cut by 70% next year, and the delays will continue after that.” Damn that Radio Shack. This is the dumbest effort to deflect blame for the disaster (okay, second dumbest; first prize goes to Noël Forgeard’s pinning the blame on Gustave Humbert: “Mon Dieu! Leave the company in this German’s hands for a few months and this happens!”). What to make of all this?

First, no, it’s not just the wiring harnesses. Something looks wrong here. Most likely, they are finishing planes already in production, but making design tweaks for future aircraft, trying to get the weight down and improve performance. The initial planes will likely be overweight. Second, here’s the market’s comment on this aircraft’s technical appeal. Aircraft delays happen all the time. But if a new plane came with a compelling case, people would wait for it. When people back out, or talk about backing out, that speaks to a serious ambivalence about the plane’s performance. ILFC’s Steve Udvar-Hazy knows more about airline economics and residual values than anyone; if he cancels that’s a serious warning.

I’ll put on my analyst hat and offer some free advice. Airbus and its stakeholders should do a brutally honest assessment of the A380. First, look carefully at the customer contract terms and pricing. Can it ever make money? Can the performance be improved? What will the penalty payments look like for missed performance promises and for late delivery? If the next few weeks see more than one or two customers cancel, that’s a good indicator that this plane will just suck cash.

Next, assess company resources. How quickly can money and engineers be shifted from the A380 to the A370? The A380 (along with the 747-8) is chasing 5-10% of the market by value; that middle market widebody segment is 50%. And, if they’re late with the A370, they run the risk of losing the narrowbody franchise, the other 40-45% of the market, to a Boeing 737 replacement.

The situation was bad enough before the new delays. The new schedule implies an ongoing ulcer that distracts from the other 90-95% of the market. In the interests of fairness, here’s some free (and bvious) advice to Boeing: as soon as the 787 is out the door, launch the 797 narrowbody. Do to the 320 what the 777 and 787 are doing to the A330/340.

To sum, if there is no hope of quickly turning the A380 into a competitive plane with decent economics and then shifting design and production resources to more important segments, kill it. The write-offs and political shame will be terrible. But national, continental, and corporate pride should have nothing to with what is essentially a business decision. More importantly, the alternative —to keep going and risk losing everything—is worse. There isn’t a lot of time here, and
it’s tough to learn from fatal mistakes.

The A380 problems are much bigger than a big plane. France, Europe, heck, everywhere, needs to look at this experience and learn from it. Many governments monkey around with their nations’ industries. Many allow strategic planning and forecasting to be corrupted by politics. Many fill top industry leadership jobs with incompetent party hacks. All of this is really bad. Period.

Separation of government and economy (i.e. capitalism) is a great idea. It means the damage government can do is restricted to the public sector. It’s not just in Europe; clueless officials
everywhere spent tens of millions in taxpayer cash on airport upgrades, just to accommodate a marginal requirement.

But old habits die hard. As the A380 news broke, French President Jacques Chirac said he had “total confidence” in the A380 (shades of G.W. Bush and FEMA director Michael Brown; “You’re doing a heckuva job, Forgie…”). Much worse than that, the debate now concerns the French Government taking a much bigger role in EADS/Airbus ownership and management. This would not go over well with the Germans. It would very definitely not go over well with the US Congress, obliterating chances of a tanker contract. It wouldn’t go over well with any capital provider or investor or global markets either.

Sure, major changes are needed at EADS France; but it needs less government control, not more (best recommendation I’ve heard: bring back Jean Pierson, last seen fishing in a boat off Corsica). And in the weirdest twist yet, France’s Socialist party is criticizing the government’s Airbus policy. Of course, we don’t know they want. It isn’t likely that fans of free enterprise will be in the awkward position of rooting for the Socialists. It’s more likely that the Socialists will use the crisis as a talking point on the evils of a market economy.

I have no idea what will happen in France, but I have a bad feeling about it. It would take years to undo re-nationalization and de-globalization. If the big government crowd succeeds, the petty tyrants in charge of the French economy will one day suffer a “Ceausescu moment”: the sudden realization that the crowd in the square is yelling, not cheering.

Another lesson. The A380 illustrates why risk is spread through outsourcing. For all the talk, the only parts of the A380 that were globalized were the systems (some, thankfully, were off-the shelf). The airframe itself is basically 100% European. This means an unpleasant level of exposure
for Airbus companies, including BAE Systems, which is now trying to extricate itself from Airbus, rather like a fox from a cruel fur hunter’s trap. Contrast this with Boeing’s approach. If the 787 test fuselages start fizzing like Alka Seltzer, Boeing’s total exposure is relatively light.

Much of the damage would be spread to Japan, Italy, and Vought. Of course, the European taxpayer politely provides Airbus with some insulation, much as Japanese and Italian taxpayers help insulate Boeing.

I’ll close this note with a defense of Airbus. Despite the industrial malpractice that has brought Airbus to this point, the market doesn’t want a monopoly. Customers will encourage anything Airbus does to reinvent its product line. That’s another reason to think about canceling the A380 and moving on. If Airbus admits defeat with this fratricidal behemoth and turns everything to the A370 and then the A320-X, airlines and lessors might step up to the plate and do what they certainly won’t do with the A380: order planes.

Yours, ‘Til the Flying Asylum Opens for Business,
Richard Aboulafia

Source IAG Forum:
http://www.iag-inc.com/

David747 · Post by **David747** » 24 Sep 2006, 02:20

I'm going to save this article from Aboulafia and then printed back here when the A380, not only becomes operational, but makes a profit for Airbus. 8)

achace · Post by **achace** » 24 Sep 2006, 02:38

I think Aboulafia although an acknowledged expert in his field enjoys a bit of "pot stirring" like a few of our worthy forum contributors.

No doubt Airbus are having production problems, but to suggest the A380 cannot meet its performance guarantees is surely squashed by one of the world's most profitable airlines(SIA) increasing its commitments by an extra nine units.

Cheers
Achace

David747 · Post by **David747** » 24 Sep 2006, 03:13

achace, I agree with your sentiments. If Aboulafia were some aviation analyst in the late 1960's, he would be saying the same thing about the 747 and its early problems before coming to the market.

TexasGuy · Post by **TexasGuy** » 24 Sep 2006, 05:37

Dont put much faith in analyst. Most of the time thier informations and opinions are erroneous!

bod · Post by **bod** » 25 Sep 2006, 12:45

There is also a serious contention that Emirates does not need the A380 it has on order.

I also heard a rumour that they don't need all the A380's ordered, but the additional planes would be leased out. [/quote]

CX · Post by CX » 25 Sep 2006, 15:50

bod wrote:
There is also a serious contention that Emirates does not need the A380 it has on order.
I also heard a rumour that they don't need all the A380's ordered, but the additional planes would be leased out.

[/quote]
I have not seen anything about this.