FWAERJ
Topic Author
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What Airbus Needs To Do To Break Even With A370(?)

Wed Jun 14, 2006 8:24 pm

OK... here's another A vs. B thread... but please keep it civil. Big grin

Thanks to the SQ order for the B787, Airbus is in crisis mode. Plan A (stay the course with the A350) is dead. Plan B (an all-new A370) is almost a given. IMO, if Airbus wants to break even (not even make a profit; just break even) in this market segment, they will have to:

-Announce the A370 (almost a given now).

-Kill the A340 family. It's already on life support, as carriers don't want a plane that burns 20% more fuel than the B773ER in an era of high jet fuel prices. Cash back just won't do, Mr. Leahy... waving the white flag in this instance for 5 or so years is a better business move than getting your butt handed to you on a silver platter for the same length of time. Just stop accepting new orders and close the line after all existing orders are completed.

-Win the EK order. However, it's highly unlikely given EK's frustration with A380 delays.

-Win an order from at least one of the European Big Three (BA, AF, LH). Personally, I see LH in the bag for Airbus given their massive A320/330/340 fleet even thoguh they are looking at the 787; while I see BA as a tossup between A and B. If Rolls-Royce is the exclusive engine supplier for the A370(?) as rumored, kiss that AF order goodbye.

-Win a 20+ plane order from a North American carrier besides US. Of course, CO and NW ordered the B787, so they're out. I see AA as very unlikely and UA as a toss-up, while I see DL grabbing any deal they can get their hands on.

Airbus needs to do these core steps now. Otherwise, Boeing will rule the roost like it did in the 1960s and 1970s.
"Did he really need the triple bypass? Or was it the miles?"
 
keesje
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RE: What Airbus Needs To Do To Break Even With A370(?)

Wed Jun 14, 2006 8:48 pm

I think they have the opportunity ("every problem has its merits" J.Cruijff) to take a good look at the 787, identify its weaknesses, appreciate it's strong points, talk to the airlines & come up with something newer/ better in 2012. Boeing is sold out until then anyway.
"Never mistake motion for action." Ernest Hemingway
 
manni
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RE: What Airbus Needs To Do To Break Even With A370(?)

Wed Jun 14, 2006 9:00 pm

Dear FWAERJ,

One day you will learn that companys are not investing money only to break even , but that there out to make a profit. If Airbus thinks it can make a bigger profit staying with the A350 as it is now, they'll stay with it, if they see a bigger return of their investment in the 'A370', they'll go for the 'A370'. If, as you write, Airbus can only hope to break even on the A370, and the A350 is dead, expect them to stick with what they've got, the A330/340  Yeah sure

No disrespect for you're young age, but could that be the basis of your rather naieve post? Try to put a bit more weight in your posts, often even kids can come up with surprisingly well tought posts.
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solnabo
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RE: What Airbus Needs To Do To Break Even With A370(?)

Wed Jun 14, 2006 9:01 pm

Guess it´s frustration in the B camp, but maybe, just maybe they win the order/delivery contest (1st in 5?) this year and all will be apple pie n rosey..

A vs B thread never turns civil these days, most bashing, right?

Cant belive I´m writing this.

Micke//SWE   

[Edited 2006-06-14 14:10:13]
Airbus SAS - Love them both
 
FWAERJ
Topic Author
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RE: What Airbus Needs To Do To Break Even With A370(?)

Wed Jun 14, 2006 10:36 pm

I'm not saying that Airbus can't make a profit with the A370... they probably can and will given their past successes. Personally, I think that the changes to the A370 as compared to the A350 can make it a viable alternative to the B787. It's just that the 787 has too much momentum behind it, even though the biggest orders for either haven't happened yet.

If Airbus and EADS want the A370 to be regarded as a true competitor to the B787 (and make a profit in the process), they'll need to make some drastic sales moves with a sale to AF/KL, BA, LH, or EK, even if it means selling the planes at a 50% discount just to boost the order books. Otherwise, they'll only break even.
"Did he really need the triple bypass? Or was it the miles?"
 
breiz
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RE: What Airbus Needs To Do To Break Even With A370(?)

Thu Jun 15, 2006 12:00 am

Quoting FWAERJ (Thread starter):
What Airbus Needs To Do To Break Even With A370(?)

I would say that first of all, Airbus needs to have a A370 which, we have read on another thread, is not going to be named A370 anyway.
And in addition, Leahy indicates no decision on redesign of the A350 so far.
So?
 
katekebo
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RE: What Airbus Needs To Do To Break Even With A370(?)

Thu Jun 15, 2006 12:14 am

As I said in another thread, I think that A350 announcement at Farnborough will be a big non-event. Firstly, I doubt Airbus can afford a full-fledged breakthrough development at this moment given the 2b euro profit gap thanks for A380 delays and 4b BAE pay-off. Second, given the issues they are facing with A380 deliveries (and to certain extent missing out on A340 performance commitments), Airbus credibility is seriously compromised and I doubt that any airline will jump on orderring a "paper" airplane from Airbus until they fix their current problems and re-build customer confidence in their capabilities.

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