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The Deal that Disappeared like a Mirage

What happened to the Emirates-Airbus deal for additional A380s?

The CEO of Airbus, Tom Enders, said: “Emirates has become synonymous with the A380, and the A380 with Emirates.” He was speaking at the handover event of the 100th A380 being delivered to Emirates Airlines, the largest operator of the super jumbo aircraft. Since the launch of the A380 programme, Emirates and Airbus have developed a deep relationship: Emirates gave the A380 the platform it needed to perform on the world stage, while the aircraft became the center of Emirates’ bid for a significant share of the world’s air traffic.

On November 3, the atmosphere at the handover ceremony was rather positive, with key members of Emirates’ senior management in attendance. It was rumored and expected that Emirates would take another 36 A380 aircraft, valued at about $17 billion dollars. According to one publication, the Dubai Airshow was said to provide the perfect backdrop for the order, which would be a farewell gift from Emirates to Airbus Sales Chief John Leahy, who was to retire after the new order.

Imagine the shock and dismay then, when at the Dubai Airshow, Airbus discovered that the deal was off the table. And, naturally, it didn’t help that the sudden cancellation of the order was followed by a huge order to Boeing for their 787-10 aircraft.

More importantly, the new order from Emirates was supposed to be the savior of the A380 programme – the fact that the deal evaporated at the last minute has plunged the future of the super jumbo into even more doubt.

Airbus officials are said to be have been left shell shocked at the turn of events at the Dubai Airshow – apparently, the about-turn was fuelled by a concern at Emirates about Airbus’ commitment to continue developing the A380. The airline obviously would not want to be the biggest operator in the world of an aircraft that no longer exists. One wonders however, if with the cancellation of the programme-saving order, the demise of the A380 programme is now a foregone conclusion.

In an interview with Bloomberg TV, the Chief Operating Officer of Airbus, Fabrice Bregier, gave a hopeful reply to a question about the debacle: he said that there remained a prospect of rescuing the transaction before the end of the year. He also said, importantly, that “If we finalise it (the deal), we will be committed to producing this aircraft, I believe, for at least the next 10 years.”

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