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Finally – Airbus secures A380 deal from Emirates

A good day for Airbus fans as the company secures the life-saving deal for the A380 – the superjumbo that was facing a program closure.

It’s been a difficult couple of months for Airbus. The Dubai Airshow gave the aircraft manufacturer a rude shock when a deal for 36 A380s with Emirates suddenly evaporated – leaving the future of the program in doubt. For the past week or so, Airbus had been openly saying that if the deal with Emirates falls through, the doors will close on the A380 program.

This would have left Emirates in a difficult position, operating a large number of an aircraft that was no longer being produced. This would have created problems, specially when time came to start retiring A380s – what would replace them?

But now, with a commitment for 20 A380s and options on 16 more, things are looking up. Emirates Chairman Sheikh Ahmed bin Saeed Al Maktoum said that the agreement, valued at $16 billion at catalogue prices, will provide “stability” to the A380 production line. Emirates will probably have paid much less than the $16 billion price tag, surely securing a fantastic discount given the situation. One is forced to wonder if that is why the situation played out in this manner after all…

But why is this order such a life saving deal?

Airbus needs to produce 5-6 A380s every year to keep the line alive and viable. The orders from Emirates, including the new order, will keep the A380 in production for another 10 years. By then, Airbus anticipates replacement orders from airlines that will start retiring older, aging A380s from their fleets. That should keep the A380 is production well into the 2030s. It is rumoured that Emirates will use some of these 36 A380s to replace older versions.

Announcing the agreement on Thursday, Emirates’ Chairman, Sheikh Ahmed bin Saeed Al Maktoum, said: “We’ve made no secret of the fact that the A380 has been a success for Emirates. Our customers love it, and we’ve been able to deploy it on different missions across our network, giving us flexibility in terms of range and passenger mix.”

Airbus hasn’t been able to find a new buyer for the A380 for the past two years, with smaller, more efficient aircraft becoming the future of air travel. The aircraft is built across Europe and Rolls Royce is a major supplier of engines. Airbus has seen great success in the sales of its smaller, single-aisle planes in the last year, particularly the A320neo. Airbus last week said that with a rush of December sales it had taken orders for 1,109 planes in total (in 2017), compared to Boeing’s 912 orders.

 

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