Airbus reduces A380 production rates

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By admin July 13, 2016 20:15

Airbus reduces A380 production rates

Not the ideal airshow announcement but Airbus has confirmed it is reducing its delivery target of 20 A380s per year in 2018 to 12. The A380 reached breakeven in 2015 at 27 deliveries and Airbus targets breakeven at 20 deliveries in 2017. Analysts expect the program to fall back into the red in 2018 with a loss of €250 million, which will rise to €350million in 2020. Airbus is already seeking cost reduction initiatives to lower that breakeven point further. Outstanding deliveries include 61 aircraft to Emirates, with another 11 A380s due for delivery to ANA, Etihad and Qatar. Amedeo also has an unfulfilled order for 20 A380s and there are 10 aircraft listed for an unidentified buyer.

The debate over whether Airbus will seek to launch the A380neo has quietened down somewhat of late with fewer and fewer market observers considering it likely the manufacturer will launch a Neo version. However, there are some opining that the decision to cut current A380 production rates may have had the Neo project launch in mind for the near future. Time will tell but with the A350-1000 now running Airbus, rather much like Boeing, is in a position of cutting the legs out from under one program as it sells aircraft on another. With Boeing the 777X hinders sales prospects for the 747-8 and so it is that the existence of the A350-1000 does the A380 no favours whatsoever.

So the news of slowing production on the A380 is expected and is necessary as it happens, so there is no surprise today, but we are all left wondering: Is there a future for the super large aircraft programs? Many airlines just do not seem to want the aircraft even though the economics are outstanding for all those that use them, save for MAS of course. IAG may well be able to gain a very good deal for any further A380s at this time, but it too, just like the Middle East majors would want to know if a Neo version will be coming to market within five years.

admin
By admin July 13, 2016 20:15