A380 deliveries to Dubai’s Emirates not affected despite Airbus production cutback

The A380, seen here at Gatwick airport in London, has been key to Emirates’s route expansion. Courtesy Gatwick Airport Limited

Emirates airline, the biggest operator of the world's largest passenger jet, said deliveries of the A380 in 2018 "will not be impacted", after Airbus announced a sharp cut in production.

The European plane maker announced it was limiting the production of its superjumbo because of a lack of demand. It will only make one aircraft a month in 2018, down from the 27 built last year.

The A380, which can carry about 540 passengers, has been key to Emirates’s global route expansion and the surging traffic numbers through its hub at Dubai International Airport, which is the world’s busiest airport for international travel. The carrier operates 81 of the superjumbos and has another 61 on order, according to its latest fact sheet.

But while the aircraft has suited the rapid growth trajectory of Emirates and Dubai’s hub strategy, its take up among many other global carriers has been slow.

Airbus had originally anticipated that it would sell 1,200 jets over two decades, but the manufacturer has delivered only 193 of the double-deckers since it came into service in 2007.

Airbus initially anticipated that mega airport hubs would welcome the arrival of the A380 plane, as it means 540 passengers or more will be moved in one go, but the reality of global aviation was different.

Operating a four-engine aircraft is costly and twin-jet, wide-body planes have proved to be more popular.

Boeing, its American rival, viewed things differently. It bet on travellers demanding more frequencies and time options to routes, which led it to develop medium size wide-body aircraft.

It developed the 787 Dreamliner along with the Boeing 777 aircraft for this purpose. Meanwhile, its own version of the A380, the 747-8 aircraft, had a fewer number of buyers – much worse than the Airbus superjumbo.

“We do believe with the dawn of ultra-long range medium to sub-medium capacity aircraft such as the A350XWB, the 787 and the 777-X and the Bombardier C series, which flies marginally longer than the Embraer 190 family, the market for the A380 has shrunk to levels Airbus may not have anticipated,” said Mark Martin, the chief executive of Martin Consulting in Dubai.

Emirates has remained a firm believer of the A380 and has made it the backbone of its fleet.

Tim Clark, Emirates Airline’s president, kept pushing Airbus for a more fuel-efficient model of the plane. Fuel is the largest component of an airline’s cost and makes up 28 per cent of Emirates’ operating costs. But Mr Clark eventually gave up on the improved version, saying he was concerned with the future of the aircraft.

“A 500 plus-seater isn’t everyone’s cup of tea and such jets are hard to fill. This is precisely why the A380 is a sales flop. Airlines other than Emirates struggle to fill it,” said Saj Ahmad, the chief analyst at StrategicAero Research.

In April, Sheikh Ahmed bin Saeed, Chairman of Dubai Civil Aviation Authority and Chairman of Emirates Group, urged Airbus to push its sales team harder to find more customers for the aircraft. “Where is an aircraft with just one customer?” Sheikh Ahmed said. “They have to push their sales team to do much better, especially now, because this aircraft has been in the market for eight years.”

The A380 programme has been in question since 2014, when Airbus first raised the possibility of discontinuing production because of a lack of new orders. That triggered a number of exchanges between executives from Emirates and Airbus over the programme’s future.

Emirates ordered two superjumbos in April, the first new A380 purchase from the Dubai airline since 2013, when it took 50 of the aircraft. “Emirates will take their full 2018 quota, but beyond them, there aren’t any big customers left,” Mr Ahmad said.

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