One year after Airbus SE got life-saving procedures for the A380 two-story plane, the future of the framework program is back on the line.
Gulf Carriers Emirates can turn some or all of the latest 20 superjumbo orders into smaller A350s, people are familiar with this issue. A330neo, another large body, is also in the mix, said one of the people. Any switch would result in the remainder of the major passenger plane orders that will lead the manufacturer to kill an aircraft with limited interest from other airlines only 11 years after it entered commercial activity.
Airbus would maintain super-silence, while other executed orders would not be executed, mainly from previous Emirates deals, according to the people who asked them not to be named because the negotiations were private. However, the transition would ultimately mean closing the production line, which the manufacturer has fought to maintain while waiting for demand to recover.
Toulouse, a French-based Airbus, seems to have provided the future of the A380 when it agreed to sell up to 36 aircraft to the Emirates last January. Since then, it has been striving to find the engineer who wants to meet the carrier's pricing and performance requirements. General Electric Co. and the Pratt & Whitney Alliance showed little enthusiasm, but the historic supplier Rolls-Royce Holdings Plc did not agree on the terms after months of negotiations.
The price has also been a problem for other carriers. Speaking at a London event on Friday, Willie Walsh, CEO of British Airways parent company IAG SA, said he was considering buying more A380, but only under better conditions than Airbus offered.
The announcement on the markets of the Airbus stock exchange on Thursday concluded that it had consulted the Emirates on the A380 agreement, which includes 16 options. On Friday, June 11, producer shares were sold 1.5 percent higher in Paris.
The Emirates, which are closely linked, said that the talks continued, but the London-based Rolls-Royce refused to comment. Stocks of turbine manufacturers increased by 1.8 percent.
Jefferies International Aviation Analyst Sandy Morris, called Airbus comments, "bland but threatening", adding: "If a significant portion of the Emirates order is canceled, we believe that the A380 program should end."
The airline's planned move from power-limited Dubai International Airport to the new center of Dubai's world around 2024 may be painting, thinking of the need for the largest passenger plane, Morris said.
Airbus is already reducing its A380 production this year to eight aircraft from six years to 2020. Even this plan was based on securing the latest Emirates deals, which were calculated as the savings of the program when it was discovered by the manufacturer's then sales manager, John Leahy.
Superjumbo slicing would put an end to the losses on each aircraft at a lower level of production and release factories to increase the production of smaller models, but could also detect Airbus up to € 1 billion ($ 1.15 billion) in cash flow from public funding that might be in line with Morris.
At the end of 2013, the A380 was an unfinished reserve for 87 planes, and the analyst said that only 53 orders from Emirates and three from Japan ANA Holdings Inc. could be considered "strong", he said. Some years have been on books.
Rolls and Emirates have been a logistical force compared to an engine arrangement, as the A380s became a chronicle from an earlier order because the airline registered in Dubai initially refused to supply some aircraft.
The deal that is currently being dealt with was delayed when working over an engine contract, and Emirates called the 2017 Dubai Air Show. The sale was resumed three months later after the two parties reached an agreement that left the final terms.
While other carriers lost interest in the A380, the Emirates did not want to abandon the aircraft, which is the central strategy for using Dubai's location at the natural crossroads to become the world's largest long-distance carrier. President Tim Clark has been one of the most vocal supporters of the airplane, loaded by the company with up to 615 passengers traveling on the globe.
Switching to the A350 Revised 2007 Order, canceled by Emirates in 2014, saying it was not sure that the plane would meet its requirements. The state-owned airline agreed to buy 50 A350-900s and 20 larger -1000s to deliver this year, and at that time it was $ 16 billion.
Adding a smaller plane with composite wings and two engines that make it more economical than the four turbines A380 would have a three-model model for Eurojust. The carrier is also Boeing Co. The 777s fleet, as well as the first superjumbo operator, is the leading modernized 777X model buyer.
The A330neo is a smaller, older engine than the A350, a re-engine version. Airbus has made it difficult to secure new versions of orders and problems with Rolls-Royce engines also slowed down production. Planemaker plans to offer a modified version of the jet to try to delay the demand for a planned mid-range jet called 797 from Boeing. DM
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