Only twice in the first decade since the Airbus A380 entered service has the double-deck aircraft ended a year with its order backlog higher than that of the previous one. On both occasions Middle Eastern carrier Emirates alone had spared the programme from recording a duck for the year. Emirates ordered 32 A380s in mid-2010 and – just eight days before the end of 2013 – signed for another 50 of the type.
This year, Airbus has been forced to rely yet again on Emirates to provide a third jump-start to the A380 orderbook. The Dubai-based airline's agreement to take 20 more aircraft, sealed in February, effectively amounts to the first net increase in A380 orders for four years.
But the Emirates deal is not guaranteed to nudge the closing backlog into a positive net result this time, even though the airframer has set a delivery target of just a dozen A380s for the year. Virgin Atlantic, one of the first airlines to sign up to the aircraft – with an agreement for six in 2001 – finally cancelled its long-inert order this year, having repeatedly deferred their introduction. Several other firm orders for the aircraft also appear vulnerable.
Airbus has staunchly defended the A380 in the face of diminishing sales. But, less than four weeks before the Emirates deal, outgoing chief operating officer for customers John Leahy publicly conceded that the production line could face closure – a stunning admission, even if it might have had the undertone of a gamble intended to pressure Emirates into committing to further deliveries.
Just ahead of this year's Farnborough air show, Leahy's successor, Eric Schulz, stated that Airbus viewed its high-capacity market offering as a "combination" of the A380 and A350-1000.
"What's really important for me is that we're successful in that market pillar," he says. "We have opportunities on the A380. We’ve had great discussions over the last six months.
"We have opportunities to increase the number of A380s. You can trust me, we won't miss an opportunity to increase the number of A380s we have in the backlog."
The A380 has been battling a downward backlog trend since the first aircraft was delivered, to Singapore Airlines in 2007. At the end of that year Airbus had logged orders for 189 of the type. While the level of orders rose by two-thirds over the following 10 years, to 317 aircraft, the backlog halved to 95.
Airbus had intended the A380 assembly line to produce four aircraft per month, but the manufacturer has never secured the demand necessary to reach this level. Even during its production peaks – reached in 2012 and again in 2014 – the airframer only managed to hand over 30 aircraft in each year. Airbus reached break-even at production level on the A380 in 2015, a year in which it delivered 27 aircraft, and it managed to deliver 28 in 2016.
But output for the A380 almost halved last year. Emirates, which had provided a foundation for A380 production, chose to defer delivery of several aircraft, while the orderbook for the type had stagnated. For 2018, Airbus had already taken a decision to cut annual production to 12 aircraft; in the first four months of the year it delivered four: two to Emirates and one apiece to Qatar Airways and Singapore Airlines.
But having subsequently chosen to cut this rate again, to just eight aircraft next year, Airbus is to trim the rate further from 2020, when its A380 production will slow to barely one aircraft every two months. Emirates' order, says Airbus, "protects a baseline" of six aircraft deliveries per year beyond 2019. It points out that, despite the slowdown, the agreement will give Airbus "visibility" on the programme and insists it will be able to achieve "reasonable industrial efficiency".
The latest Emirates order for 20 A380s will sustain production at the reduced rate until 2027, the airframer states. And, the Emirates order includes options for 16 more aircraft which could extend this production to 2029. Airbus is hoping that the agreement from Emirates and its own commitment to keep the line open will give other carriers confidence in the longevity of the programme and encourage them to acquire the type.
But even new orders might not lift the backlog. While it officially stood at 105 A380s at the end of April, analysis of the customer base highlights Airbus's extraordinary dependence on Emirates. Other than those destined for Emirates, just five A380s in the backlog are strong prospects for delivery – three for new operator All Nippon Airways of Japan, the first of which rolled out from the assembly line in late May, and two for Singapore Airlines.
Ten A380 customers – among them Air France, Lufthansa, Asiana, Qatar Airways and Korean Air – have already completed deliveries of all the A380s they had on order, with no firm indications of intentions to acquire more.
Two primary European operators, Air France and Lufthansa, opted against taking their entire original A380 order. Qatar Airways has signalled that it is not planning to firm options, while partner British Airways – arguably the A380's second-greatest supporter – has remained lukewarm on taking further aircraft.
Qantas Airways is the only other customer with an incomplete order. But while it has chosen to reconfigure its A380 fleet next year with a new "Cabin Flex" interior – allowing up to seven more business-class seats on the upper deck through deactivation of a pair of exits – the Australian airline has also indicated reluctance to take the remaining eight A380s it has on order.
These eight are among 41 A380s in the backlog – almost 40% of undelivered aircraft – which may never be manufactured. Lessor Amedeo has yet to take any of its 20 A380s, and another 10 remain assigned to an undisclosed customer after Hong Kong Airlines dropped its plans to take the type. These aircraft were originally due to be delivered in 2015-16.
Iran Air had briefly toyed with the possibility of taking A380s but scrapped the idea before placing an extensive fleet-renewal deal with Airbus – a deal which has since become enmeshed in the reignited political dispute between the US and Iranian governments.
The A380 programme has not only faced internal pressure; the programme as a whole has remained a central aspect of the continuing transatlantic trade dispute between Airbus and Boeing over large civil aircraft launch aid, and the subject of measures by Airbus to withdraw funding subsidies.
But although Airbus chief Tom Enders concedes that A380 production has hit "rock bottom", the airframer is maintaining its faith that prospects for the double-deck aircraft will eventually emerge and the production rate will recover. Airbus has previously described the case for the A380 as "inevitable", given the pressure of rising traffic demand and the increasing congestion at major hub airports.
All Nippon Airways will offer a little relief for the embattled programme when it puts its first aircraft into service early next year. Portuguese wet-lease specialist Hi Fly is also set to become a new operator of the type in Europe, when it opens the second-hand market for the A380 by putting an ex-Singapore Airlines jet into service.
While the A380 finally toppled the Boeing 747 last year as the leading very-large-capacity aircraft in the world's passenger fleets, the achievement hardly reflected Airbus's original ambitions for its flagship jet. It might have prevailed over its 50-year-old rival in that particular battle, but the A380 has yet to show that it is able to win the war.
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Source: FlightGlobal.com
