KUALA LUMPUR: The future of the world’s largest commercial airplane, the Airbus A380, continues to look bleak in just 10 years of being in service.
The superjumbo jet, which is also one of the most expensive commercial planes with a market price of US$436 million each, suffered a major blow at this year’s Dubai Air Show when its number one customer, Emirates Airline, decided to turn to its rival Boeing to order 40 B787-10s.
While the European plane manufacturer is facing a challenging time to find new customers for its A380, people in the industry are predicting that the aircraft model would be discontinued after 2020.
Airbus begs to differ, saying that the A380 has been turning heads for a decade, claiming that the model is a game-changer that symbolises innovation in the aerospace industry and marks a turning point for Airbus and its operators.
"The A380 is here to stay, and it is the aircraft for the future. With passenger traffic doubling every 15 years, the A380 is the solution for sustainable growth.
"It can help to de-congest airports on the growing number of high-volume, high-traffic and heavily-travelled routes, many of which are in the Asia Pacific region,” an Airbus spokesperson told NST Business last week.
Airbus in its latest 2017-2036 Forecast report noted the need for commercial aircraft above 100 seats would double in the next 20 years, with nearly 35,000 new deliveries targeted.
Of the total new deliveries forecasted, 71 per cent of units would be single-aisle aircraft while 54 per cent would be wide-body models.
Asia Pacific would account for 41 per cent of the new aircraft with more than 100 seats demand, while the United States and Europe together represents 36 per cent, according to the report.
The Airbus spokesperson said about 99 per cent of future long haul traffic would be between mega cities, many in the Asia Pacific region.
"Today, 54 per cent of A380 capacity is from, to or within the Asia Pacific region, the fastest growing market in the world, and 18 per cent is on regional flights within Asia.
"High demand and congestion means that this region, in particular, needs the A380,” the spokesperson added.
Interestingly, Airbus’ Executive Vice President Head of Programs Didier Evrard was quoted in May this year that the European plane-maker would decide on the number of production of the A380 by year-end.
He said production could be less than 12 planes per year.
To date, Airbus has delivered 213 of the A380 with 104 planes in its backlog order.
Maybank Investment Bank Bhd (Maybank IB) aviation analyst Mohshin Aziz viewed that the cost to buy and maintaining the A380 would be higher in the future should the number of production decreases.
"Like any production line, you need a minimum volume in order to sustain the operations. Without it, production will shutdown to a halt, component suppliers will likely raise prices because contracts are always based on a minimum order level,” he said, adding that Airbus needs to improve on the value proposition of the aircraft.
He said the superjumbo plane is a niche model where only a few airports in the world are capable of taking in the A380.
"The runway length, the runway strength, the runway shoulder width, (whether) the airport has double-decker aerobridge, etc. There are just too many requirements for this bird. Therefore I suspect the (potential) customers would likely be existing customers,” he added.
Currently, there is no second-hand market for the A380.
Airbus however, is confident in the market for second-hand A380s, which the plane maker claimed can be leased or acquired at attractive rates.
“This will offer a great opportunity for new entrants with new business models to start operating the A380, as well as for major carriers, who already operate A380s or actively considering doing so in the future,” the spokesperson said.
Although the re-sale market of the A380 is non-existent at the moment, the jumbo jet could be used for the Islamic pilgrimage route as announced by Malaysia Airlines (MAS).
In December last year, the airline’s former chief executive officer (CEO) Peter Bellew told NST Business that MAS will start a new charter airline specifically to serve the Haj and Umrah markets.