Airbus Terminates A380 Program

 - February 14, 2019, 10:44 AM
Emirates will take delivery of the last Airbus A380 in 2021. (Photo: Emirates)

While stressing it would continue to fully support the A380 customers that operate a total of about 230 of the four-engine jetliners, Airbus on Thursday confirmed enduring speculation it would end the program that it launched only in 2000 as part of its goal to gain a share of the market Boeing had cornered with the 747. Airbus CEO Tom Enders described the decision as “painful” but inevitable after Emirates Airline, by far the largest customer of the aircraft, reduced its outstanding A380 order by 39 examples.

Speaking Thursday during a fourth-quarter/full-year earnings presentation with analysts, Enders said the European OEM had “invested a lot of effort, a lot of resources, and a lot of sweat” in the A380 program. “But obviously we need to be realistic,” he explained. “With the decision of Emirates to reduce their orders, our order backlog is not sufficient to sustain production beyond 2021 despite all our sales efforts with other airlines in recent years.”

Airbus said it will produce just 17 A380s—14 for Emirates and three for All Nippon Airways—until it closes the type’s final assembly line. The last two, for Emirates, will roll off the assembly line in 2021, when the Dubai airline will have taken delivery of 123 units.

At the end of January, Airbus had received firm orders for 313 A380s, less than half the number it had planned when it launched the program, and delivered 234. Last month’s orders and deliveries overview still showed an outstanding order for 20 unit from lessor Amedeo and three for Air Accord, the Bahamas-based company due to take on the three A380s ordered by defunct Russian airline Transaero. Last week, Qantas canceled its outstanding order for eight of the type.

Ahmed bin Saeed Al Maktoum, chairman and chief executive of Emirates Airline and group, joined Enders in describing the end of the program as disappointing and noted he accepted the reality of the situation following months of negotiations with Airbus and Rolls-Royce. The model will remain a pillar of the Gulf carrier’s fleet “well into the 2030s,” he added.

As part of the agreement, Emirates signed a heads of agreement with Airbus for 40 A330-900s and 30 A350-900s, deliveries of which will start in 2021 and 2024, respectively. The airline plans to deploy the A330neos on regional routes, where the re-engined widebodies can serve smaller airports and open new destinations in its global network, the carrier said. Plans call for the A350s to supplement Emirates’s long-haul operations, providing the carrier with added flexibility in terms of capacity deployment on 8- to 12-hour missions from its Dubai hub.

Overall, Airbus remained upbeat on its overall outlook and said it plans to hand over 880 to 890 aircraft in 2019, compared with 800 last year.