The rapid demise of the Airbus A380 is a complex tale of missed connections, a changing market and, ultimately, a staggering lack of demand for the largest commercial airplane ever built. And, as a result, this giant of the skies could well be the last of its kind.
The decision to stop production on the A380 came after Emirates, which operates more than half of all flights using the plane, halved its latest order. After being in production for a little over 12 years, the A380 will go down as one of the shortest-lived models in aviation history. But why did it fail?
To understand that, you first need to understand how Airbus hoped it would succeed. The thought process behind the aircraft’s design – specifically, its size – had two major threads. The first, argues John Grant, director of JG Aviation Consultants, was “a strategic desire to distance themselves from being just another Boeing.” (Boeing had released a smaller aircraft, the 787 Dreamliner, at the same time back in 2007). To an extent, that worked. So far so good.
The second problem was a gamble on the future of the market. “It was designed to solve an expected problem”, says Keith Mason, Professor of Air Transport Management at Cranfield University, who assessed Boeing and Airbus’s differences in philosophy back in 2007. Airbus’s logic here was simple: if the industry continued to grow at the expected rate – Mason says passenger numbers typically double every 15 years – then airports would be overwhelmed by the sheer number of people. A large plane, so the argument went, would help ease this bottleneck by picking up more people per flight while also maximising value for pricey landing slots. This prediction proved to be wrong. “Airport congestion hasn’t happened,” says Mason. In fact, airport capacity in many markets, especially Asia, has grown.
The A380’s failure is also a result of a switch in the aviation world towards smaller, more efficient aircraft. Boeing’s B787, for example, seats around half as many passengers as the A380. In fact, Emirates, as it cut back on the A380, placed a large order of Airbus’s own saller A350 and A330. Grant points out that these aircraft offer “better operating economics, lower costs, smaller capacity and therefore less pressure to fill every seat”.
The sheer size and luxury of the A380 also played a role in its undoing. The plane, which is estimated to have cost $25bn (£19.4bn) to develop, runs on a capacity of 320,000 litres of fuel, packs four 70,000lb thrust engines, carries 555 passengers over two decks and 500 square meters of floor space, and has a duty free shop, bar restaurant and beauty salon.
Mason points out that while this type of “hotel in sky” superjumbo was seen as a technological marvel at the time, “it is now considered an overly expensive aircraft, with four engines that are less efficient than newer engines found on late model, twin-engined aircraft.” He also explains that filling an aircraft with more than 500 seats demands selling at least some of the tickets at low prices. Overall yield is therefore lower than a smaller aircraft, which are easier to fill up. “Airlines have been nervous to commit to very large aircraft”, says Mason. “They often cannot find a sufficient number of suitable routes where demand is high enough to fill the aircraft at a decent yield.”
Airbus was correct in one prediction. It envisaged that flights would continue to be hub-to-hub, involving passenger transfers in major airports. (Think of a flight from Europe to Japan, for example, that requires a stopover in Dubai.) Boeing, in contrast, positioned its 787 as a hub-bypass, made for direct “point-to-point” flights. Here, it's Airbus that has been proven correct. As a Centre for Aviation study puts it, “hubs dominate, yet most airlines prefer medium/large aircraft and not the very large aircraft category, consisting of A380s and 747-8s.” In Boeing’s case, figures show that in 2016 a whopping 73 per cent of 787 flights were made between hubs. Yet, for the reason Mason outlines, this has not been enough to save the A380.
In fact, the sheer lack of demand for the A380 is astonishing, says Grant: “Today over half of all fights operated on the A380 are operated by Emirates and less than 20 carriers globally operate the aircraft type. That in itself tells you how little interest there was from other airlines ” In the end, Grant argues, the “egos” of Emirates and Airbus got the better of sound business decisions. "They got carried away in placing too much emphasis on this idea when others, such as Boeing, felt that we would see longer, thinner long-haul routes emerge with new aircraft technology.”
Tom Enders, Airbus’s chief executive, said the decision was “painful”, but promised customers that the A380 will still “roam the skies for many years to come”. Little over a decade ago, the A380 was seen as the future of aviation. But for Airbus, and the airline industry it relies on, the numbers no longer add up.
This article was originally published by WIRED UK
