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A380 Retirements, Good for the 777X?

Posted: Tue Jan 26, 2021 8:45 pm
by TWA772LR
With the A380 all but disappeared from the skies, and the end of the beginning of COVID complete, the return of air travel demand seems to be coming in to sight. Airlines that had the ability to fill A380s before kept handfuls or have retired all of them. But when the demand recovers, they will still need a larger aircraft to fill up. With the 777X being the only new-build VLA (if it can be called that) available, that means it's the only one with a decent shot of filling the A380s role with a still lower capacity and costs.

With the A380s going away, has an opportunity been made for the 777X to come in to its own and really have sales take off? Many operators of A380s have sizable fleets of 777s and/or 787s so it would be an even better fit. Is Boeing still perusing sales of the type?

Re: A380 Retirements, Good for the 777X?

Posted: Tue Jan 26, 2021 9:00 pm
by flybynight
There should still be healthy fleet of Emirates A380's flying for a while I think.

It would be interesting to see airline by airline which ones have retired their A380 fleet. The first one that comes to mind is Air France, but I believe LH, BA and Korean are keeping theirs for now. I could be wrong on this since I haven't researched it.

Re: A380 Retirements, Good for the 777X?

Posted: Tue Jan 26, 2021 9:06 pm
by MIflyer12
TWA772LR wrote:
Airlines that had the ability to fill A380s before kept handfuls or have retired all of them.


If A380 carriers though that there was demand coming back in the short term - say, less than 24 months - they wouldn't have retired their A380s. Airbus announced the termination of A380 production well before covid. It wasn't covid that killed the A380, it was the 77W, 787 and A350.

TWA772LR wrote:
But when the demand recovers, they will still need a larger aircraft to fill up.


That's the fallacy that caused Airbus to whizz away Billions - 'Traffic keeps growing so we need bigger planes!' No, you really don't - there aren't enough capacity-limited long-haul airports to justify clean-sheet $ Billions in spending when demand can fragment. IST can work just as well as a DXB hub for tens of millions of passengers, non-stops from 2nd-tier cities instead of routing through JFK/EWR/LHR, enough TPAC range to skip Tokyo and fly directly to China... the list is long.

It's one less type competing in the VLA space, so that's good. Some market spaces just aren't big enough to support two competitors, be they routes or capital goods. But competitive overlap is a lot bigger than a lot of a.netters want to admit. You don't need a 400-seat plane to replace another 400-seat plane. You don't need the exact seat count of a 763 to replace a 763. And think about it - if lower seat counts couldn't work, and routes couldn't fragment, there would be no use for a 321XLR.

Re: A380 Retirements, Good for the 777X?

Posted: Tue Jan 26, 2021 9:16 pm
by JayinKitsap
TWA772LR wrote:
Many operators of A380s have sizable fleets of 777s and/or 787s so it would be an even better fit. Is Boeing still perusing sales of the type?


I am unaware that Boeing has stopped their sales campaigns for the 779, why would they.

The real question is "Which airline has the desire or resources to commit to a widebody order at this time. Boeing would love an order for even 10 779's right now.

Re: A380 Retirements, Good for the 777X?

Posted: Tue Jan 26, 2021 9:26 pm
by Opus99
MIflyer12 wrote:
TWA772LR wrote:
Airlines that had the ability to fill A380s before kept handfuls or have retired all of them.


If A380 carriers though that there was demand coming back in the short term - say, less than 24 months - they wouldn't have retired their A380s. Airbus announced the termination of A380 production well before covid. It wasn't covid that killed the A380, it was the 77W, 787 and A350.

TWA772LR wrote:
But when the demand recovers, they will still need a larger aircraft to fill up.


That's the fallacy that caused Airbus to whizz away Billions - 'Traffic keeps growing so we need bigger planes!' No, you really don't - there aren't enough capacity-limited long-haul airports to justify clean-sheet $ Billions in spending when demand can fragment. IST can work just as well as a DXB hub for tens of millions of passengers, non-stops from 2nd-tier cities instead of routing through JFK/EWR/LHR, enough TPAC range to skip Tokyo and fly directly to China... the list is long.

It's one less type competing in the VLA space, so that's good. Some market spaces just aren't big enough to support two competitors, be they routes or capital goods. But competitive overlap is a lot bigger than a lot of a.netters want to admit. You don't need a 400-seat plane to replace another 400-seat plane. You don't need the exact seat count of a 763 to replace a 763. And think about it - if lower seat counts couldn't work, and routes couldn't fragment, there would be no use for a 321XLR.

Which is why the 777x a 400 seater (in the most dense config) can replace the 350 - a 500 seater (in average config)

Re: A380 Retirements, Good for the 777X?

Posted: Tue Jan 26, 2021 10:14 pm
by sfojvjets
Opus99 wrote:
Which is why the 777x a 400 seater (in the most dense config) can replace the 350 - a 500 seater (in average config)


I assume you mean A380 not 350. And yes, while the 777X can do it well, the 35K can do it with a reduction of only ~20 seats and has the extra boost of being cheaper and having commonality with pre-existing fleets such as a330/neo and a359s.

Re: A380 Retirements, Good for the 777X?

Posted: Tue Jan 26, 2021 10:16 pm
by sfojvjets
Going back to the original question of this thread, I'd say A380 retirements *in general* are good for medium-large twinjets, of course but the 777X will probably benefit less than we think. As we've seen the shift in the industry from being in favor of big quadjets (747, A380) to big twinjets (777) and now to slightly smaller and more versatile twinjets (787, A350), I think this begs the question of how will this influence the industry, post-Covid, and how does the 777X fit into this. For example, let's take a look at Air France. I recall Ben Smith or some other AF/KLM exec saying that they do not have plans to fly anything large than an A350-1000 (sorry, can't find the link). If this is indeed the case, this means that the 777X is out of the question for AF. At the same time, while their 777-200ERs are being replaced by A350-900s, they must be considering a 77w replacement on the horizon, which must be the A35K. This would show that although A380 retirements are, in general, good for large-ish twinjets, the 777X is less likely to be a beneficiary than the A350 or 787 programs due to its larger size, higher cost, and decreased versatility. Now, maybe a few years into the future this could change, and not all airlines are thinking along the lines of what AF is. I'm sure BA will utilize their 24 options for the 777X and maybe even order more, on top of their firm order for 18, when they look for an A380 and 777 replacement. LH is also bound to increase their 777X order in the future for the eventual replacement of their 748s and more immediate replacement of 744s and A380s. But this doesn't change the fact that the general trend towards efficiency and commonality in fleets over size poses a greater benefit to the 787 and A350 families since they are more flexible, cheaper, and are easier to fill.

Re: A380 Retirements, Good for the 777X?

Posted: Tue Jan 26, 2021 10:22 pm
by Antarius
sfojvjets wrote:
Opus99 wrote:
Which is why the 777x a 400 seater (in the most dense config) can replace the 350 - a 500 seater (in average config)


I assume you mean A380 not 350. And yes, while the 777X can do it well, the 35K can do it with a reduction of only ~20 seats and has the extra boost of being cheaper and having commonality with pre-existing fleets such as a330/neo and a359s.


You could argue the same with the 777X and other 777s.

Both models will likely exist and sell. The a359 and 787 will likely continue to sell much better though.

Re: A380 Retirements, Good for the 777X?

Posted: Tue Jan 26, 2021 10:25 pm
by Opus99
sfojvjets wrote:
Opus99 wrote:
Which is why the 777x a 400 seater (in the most dense config) can replace the 350 - a 500 seater (in average config)


I assume you mean A380 not 350. And yes, while the 777X can do it well, the 35K can do it with a reduction of only ~20 seats and has the extra boost of being cheaper and having commonality with pre-existing fleets such as a330/neo and a359s.

Yes i meant 380. 35K is not necessarily cheaper....just because the list price is lower. At launch 777x and 35K had list price difference of 15M.

Re: A380 Retirements, Good for the 777X?

Posted: Tue Jan 26, 2021 10:32 pm
by mxaxai
No.

The demand in recent times looked a bit like a bell curve. Limited demand at the lower and upper end with a big focus on medium sizes.
Reduced demand simply shifts that curve to smaller aircraft. This means that the overall demand for the 77X is likely smaller than pre-COVID.

Re: A380 Retirements, Good for the 777X?

Posted: Wed Jan 27, 2021 12:39 am
by filipinoavgeek
flybynight wrote:
There should still be healthy fleet of Emirates A380's flying for a while I think.

It would be interesting to see airline by airline which ones have retired their A380 fleet. The first one that comes to mind is Air France, but I believe LH, BA and Korean are keeping theirs for now. I could be wrong on this since I haven't researched it.


BA is indeed keeping at least part of its fleet for now, but LH has retired half of their fleet and the rest are grounded indefinitely unless "markets make a quick recovery", a statement that had made some observers skeptical that those will ever fly again. KA's A380 fleet's future is murkier given their planned merger with Asiana (KA apparently said that they are bullish on their 748s but are "evaluating their A380 fleet", although at the moment most expect them to keep at least some frames).

Re: A380 Retirements, Good for the 777X?

Posted: Wed Jan 27, 2021 1:59 am
by smartplane
The market has moved, probably for a decade, to smaller aircraft units, a trend which started before covid, but which has accelerated since. That move can be partially countered by re-pricing, but why would Boeing do that, when those pricing decisions will erode 787 and 737 margins.

For X orders you need willing customers and financiers. By 2030, the majority of the in service X fleet will ultimately be owned and / or financed by Boeing.

Re: A380 Retirements, Good for the 777X?

Posted: Wed Jan 27, 2021 9:56 pm
by 2175301
To respond to the original question: Yes, the retirement and end of production of the A380 will benefit the B778 and B779. However, due to Covid-19, it may be a number of years before such benefit is significant. I personally anticipate that the B777X production line will loose money for about a decade - which is twice as long as it should have been with a normal (non-Covid-19) startup.

Have a great day,