Skip to comments.Airbus Curtails Production Of A380 Freight Superjumbo
Posted on 03/01/2007 12:56:24 PM PST by magellan
Financially troubled European airplane manufacturer Airbus has stopped work on the freight version of its new A380 superjumbo so it can focus more on the troubled passenger version of the aircraft, a spokesman for its parent company said Thursday.
"The work on the freight version of the A380 has just been temporarily cut off ... so that all capacities can be directed at the A380 passenger version," said Michael Hauger, spokesman for the European Aeronautic Defence & Space Co., in a telephone call from Munich.
Last week, United Parcel Service Inc. (UPS) postponed taking delivery on the A380 freight version.
It was the last remaining customer for the freightliner, and UPS said it would decide later this year whether to move ahead with a plan to purchase 10 of the jets or cancel the order completely.
UPS originally ordered the 10 jets in January 2005, with options to buy 10 more in a deal valued at roughly $2.8 billion at list prices.
Airbus spokeswoman Ann de Crozals said the decision to postpone work on the A380F came after the UPS decision.
"Following the rescheduling with UPS, development work on the A380F has been interrupted but the program is still ongoing," de Crozals said. "It's not a decision to stop the program."
There is a new development schedule for the freight version A380F, Hauger said, adding that the company believes there is a sales potential for 400 models of the A380 freight aircraft in the next 20 years.
Toulouse, France-based Airbus is struggling to survive the crippling fallout from a two-year delay to the A380 and the weaker U.S. dollar in which the planes are priced.
Airbus said Wednesday it would shed 4,300 jobs in France, 3,700 in Germany, 1,600 in Britain and 400 in Spain over four years.
De Crozals said no date had been set for work to resume on the freight version of the aircraft.
FedEx Corp. canceled its order for 10 A380s in November, saying Airbus's production problems were threatening its international expansion plans. Instead, it ordered 15 Boeing 777 freighters and options for 15 more in a deal valued at about $3.5 billion at list prices.
Magellan, I added the keyword "AEROSPACE" to your post.
Paleo: Other Shoe Dropping ping.
The Toulouse Goose is cooked.
stick a fork in them
If the problem was the wiring for the passenger compartment and entertainment systems and customer customization, it seems Airbus should be able to make frieghters instead, while these problems are ironed out.
Unless they have been lying all along. But that couldn't be true!
Maybe I'm thinking too much as a former engineer, but given the complexities of these planes, wouldn't it have been better to START with the freighter version? If they would have built the freighter first they could have resolved the airframe issues, flight controls, flight testing, etc., then moved to add the more complex interior modules that account for a large part of their wiring issues.
The Freighter version first would have built confidence into the manufacturing process as it minimized overall exposure.
Oh well - never mind.
Obviously, a freighter would have been simpler to build.
If you want on or off my aerospace ping list, please contact me by Freep mail.
I don't doubt that they've had troubles with the wiring. But I think the real trouble is that it sucks down a lot more fuel than predicted.
There's ususally more mark up on passenger planes, and it would have used different landing gear and wings than the 800 model passenger version. I think what this also means is the A380-900 won't be built for at least a decade if ever, because it would share the heavier wing and landing gear with the A380-800F.
And how are A-400 sales going these days?
Naaah...it makes too much sense. ;^)
How long before UPS cancels their order?
They'll build more than that, but they have to sell over 420 just to break even (according to their numbers) - probably double that to get a decent return on their investment. I wouldn't be surprised if the real numbers aer 500 and 1,000.
For perspective. Boeing didn't deliver its 500'th 747 till 1981 which was 12 years after the first one was delivered. The 1,000'th 747 was delivered in 1993, 24 years after the first delivery. If Boeing sells 500 747-8's both the freigher and passenger models, it will have been an enormous success. I wouldn't be surprised if ten years after the first 747-8 rolls off the line, Boeing announces it is developing Y-3, their replacement for the 777-300, 747-400, 747-8, and A380-800 based on technologies developed for the 787 and 737 replacement. Such a plane would be structurally much lighter than the A380 or 747 and have twin engines. The massive improvement in CASM and cost per ton mile would dry up orders for the A380 well before it reaches a rate of return on capital equal to US T-Bills.
Airbus must not be willing to return the deposit money originally put down on over 30 A300-600F's. The deposits were converted to 10 A380-800F's.
Fact is, nobody seemed to *want* the A380-800F. There were some nibbles, but only UPS and FedEx committed, and FedEx backed out first. They've still got interest on the -800 passenger version from Middle Eastern and Asian airlines that want to use them on medium-length high-density routes, and Qantas. Not to mention, of course, the state-dominated European airlines that'll be forced to order some of the things to show solidarity.
I think it'll enter commercial service, and it'll probably be a mild "success"--a couple of hundred of them flying around for airlines like Emirates and Singapore. But at this point I don't see how they can ever hope to break even with it, if Paleo's figures are correct. It'll be a technological showpiece and one hell of a museum exhibit, but not a whole lot more.
If the entire A380 program ever needed a code name, I've got the perfect one:
You're thinking like an engineer instead of as a politician. It was a political decision from the git-go to build the Largest Passenger Aircraft in the World. Airbus let the political considerations over-ride the market research. But more seriously, it looks like they let them over-ride the engineering as well.
Building an A380 frieghter is not a superlative, because the Russians already have a larger frieghter in the air. It would not satisfy the political requirement.
Considering sales of 420 of them represents the break-even point, I wouldn't call a couple of hundred a success.
....WEIGHT A MINUTE!!
I jes' l-o-o-ve posting this graphic from Randy's Journal!
I wouldn't be so quick to count it out. If you think it'll be cancelled after seven or eight aircraft are produced then you must not understand socialism. Socialistic processes are neither motivated nor demotivated by the presence or absence of profits.
Success and failure don't matter when you have a tap on the veins of the European taxpayer. Airbus will get whatever it needs to insulate itself from the disasters of it's own making.
Of course the European taxpayer will get screwed. But they should be used to that by now.
Airbus is a jobs program that makes aircraft on the side.
Now they aren't even doing very well at making jobs.
Yes, and we haven't seen the end of it. There will be additional problems created by the restless workers as they protest the "Power 8" restructuring plan.
Oh, wait -- I have an idea -- decrease the French work week from 35 hours to 30 hours. That'll create jobs, making up for all the layoffs!
Break-even never has to be a concern at Airbust. Its a socialist job creation program that builds airplanes on the side.
Here is how it works:
Depending on how much tax-payer money each country provides (Spain, France, UK, and Germany) for the planes development costs heavily dictates how many jobs are handed out for the planes manufacturing and assembly. (example: The UK donated a big chunk towards the R&D costs for the A380 so it got the manufacturing of wings at its UK factory)
Then when planes are delivered (remember that Airbust doesn't get paid until each plane is delivered), a portion of that revenue is supposedly paid back to the governments who put up the original subsides. This system also means a lot of politics is involved in the running of the company. Governments will have alot of say in matters like job cuts, pay, benefits, pensions, where what gets built, etc...
This is the complete opposite of how Boeing operates were they are not provided any subsides by the US government to fund the R&D for its commercial aircraft division. Boeing has to count on delivering planes to break even / generate profit on its development investment.
Airbusts economic model only works when you have a successful plane with a steady flow of orders and the planes are being delivered to customers on time and on budget. But when you end up with something like the A380, that means its questionable if the governments that put up the money for its development will ever recoup their investment and now . Your talking about billions of dollars down the drain where Airbust is now saying they will have to sell over 400 A380's just to break even, but we all know that number is going to be a lot higher.
That means the Hajj, I think.
I had a pal who flew some Hajj charters. He landed MD-11's in some of the most backward Muslim hellholes in the world, on airstrips I'd be afraid to use in a DC-3. Then they packed in every smelly ignorant goatherd for miles around, flew them all to Mecca, and back a week or so later.
The week of downtime was spent in a Dubai hot tub with Swedish stewardesses, so I guess that part was OK.
Not OK is when the hajis try to start a fire in the aisle of the aircraft to cook the live chicken they brought on board in a crate; this apprently happened a time or two.
Supposedly, the in-flight fire that claimed the lives of over 300 people onboard a Saudi Arabian L-1011 many years ago, heading from Riyadh to Jeddah, was caused by just what you said--somebody cooking with a campstove or Sterno or something in the middle of the aisle. (That's a persistent rumor, anyway, I'm not sure if it's fact.) The crew detected a fire in an aft cargo area and were then told there was a fire in the rear cabin. The saddest part was that the deaths were preventable--for unknown reasons, the captain ordered the attendants NOT to evacuate the passengers upon landing, and when he did land, he didn't stop immediately on the runway--he taxiied off the runway like normal and didn't shut the engines down for three minutes. Between a lack of knowledge of the L-1011's emergency exits, and the fire, it took firefighters at the airport TWENTY-THREE MINUTES to get inside the cabin after landing. Everybody, including the flight crew, died.
Each member of the flight crew had a history of learning difficulties. The captain had a record of suboptimal decision making through his career. The First Officer failed his training program, was inexperienced with the L-1011, and did not attempt to assist the captain. The Flight Engineer was thought to be dyslexic and was frequently confusing left and right side.
The sad thing is, if a company like McDonnell Douglas bets big and loses, the company busts and people move on. But when France or Germany bets big and loses, they don't go bust, because they can just keep tapping the taxpayer to cover any loss. So lessons are never learned, and disfunctional organizations are allowed to create mayhem, over and over again.
If you think the A380 is a CF, just wait until the A350XWB gets close to launch...
I think the real problem is that it sucks.
The numbers are way higher. If they sell 100 units I would be shocked. This is a big loser in many ways.
LOL, yup, I've posted that a time or two myself. Airbust counters that the gross tonage may not be that much better than the 747-8F, but the number of containers it can carry is 50% more.
The A380F is built to carry volume, not weight, which only appeals to a few package shipping companies, such as FedEx and UPS. Airbust still claims a lifetime demand for 400 freighters, but I say they will maybe eventually revive the 10 for FedEx and 10 for UPS in another decade or so, but not much more.
It's already sold over 150 units but not without launch discount pricing. You may be correct though about addtional undiscounted sales.
LOLOL. DC-3's need an airfield?
True, but we are talking about European egos here.
just wait until the A350XWB gets close to launch...
They will have over 7 years to reverse engineer the entire 787. If they can't produce something better given that advantage, they are toast.
Then they are toast. I don't think they can do it.
Opps... I meant,,, developing a twin engine plane like the size of the A-380 , 747
But that will probably happen within the next 15 years. the GE90-115 has been tested at 130,000 pounds of thrust. It will probably take an engine with at least 150,000 pounds of thrust for a twin engined CFRP 747 replacement. It will come out a long time before the A380 gets the desired rate of return for Airbus. Also, if Boeing were to develop a 747 sized blended wing body composite aircraft, its possible they might be able to be able to mount three engines in the rear. This would eliminate the necessity of developing a very large engine that would have a demand for a very low number of units.
Thank you, UPS for sticking it into them and breaking it off!
USA! USA! USA! USA!
It never made sense for FedEx or UPS in the first place. I have no idea what they were thinking buying an airplane that takes until after 1030 am just to unlosd, maybe currying favor with Airbus at the time in regard to other issues (FedEx flies a lot of A310's)?
The part about Boeing being petrified is pretty funny. Hey, guess what, Air bus, Boeing can deliver their jets on time!