The Reuters article is below.
http://www.reuters.com/article/marke...sNews/idUKL1262865120071012?rpc=44

This is not a A vs. B thread.
This is a thread to discuss the competency of John Leahy (or if his koolaid is bad).

I do not believe John Leahy was copied in on the A350 memo where both A (and B earlier) determined the next wave of aircraft will be composite. The decision on the A350 was in response to the B787. The future flagship will be the A350 not the A380 because size isn't nescesarily better.

Large Metal Aircraft sales will be effectively obsolite within 5 years after the A350 has been completed. Ecomonics will dictate the change from Metal to Composite.


I want a.netters to chime in on the longevity of Metal Aircraft Sales and if they will go on for two decades as Leahy suggests?

Quoting BillReid (Thread starter): I do not believe John Leahy was copied in on the A350 memo where both A (and B earlier) determined the next wave of aircraft will be composite.

As long as nobody builds a composite plane in the size category of the A380, that point is pretty moot...

Quoting BillReid (Thread starter): Large Metal Aircraft sales will be effectively obsolite within 5 years after the A350 has been completed.

Only in those markets where there is a composite alternative.

If the Internet was around 35-40 years ago and someone told you that the 747 would sell 800, let alone 1,400 units, you'd probably have had them carted away to a funny farm (or just told them they were talking nonsense, which would probably save a lot of paperwork), but look what's happened ...

That said, I do find it quite difficult to believe; for one thing, the 747 has sold very well as a freighter and I don't see the A380 being as good a freighter and there'll be many smaller, more efficient freighters around, like the 777F, possibly the 350F as well. As for the type of materials used, metal or composite, I can't really comment on that; certainly, there will always be a drive towards lighter and less expensive materials and if their safety and reliability is proven, well and good; we'll probably see more composite components and parts on the 380 over a period of time.

Quoting Scorpio (Reply 2): Only in those markets where there is a composite alternative.

A much more cost efficient A350-900 or 1000 is a composite alternative. It isn't the same size, but it is an alternative. For example, if you can fly 2 A350-900s on a route with a better CASM and better cargo revenue, you would do so unless the route was slot controlled. Which means there is a market for the A380, but not an infinite one. In the face of the new reality of their own A350 product, the A380 market is about 1/2 the market of the 744, maybe, maybe 2/3rds, but that's no where near 800 frames. 350-550 is a very reasonable range for A380 sales over time, and without all the delays and cost overruns, that would have been a respectable return for the program (well 500+ would be).

Quoting BillReid (Thread starter): The future flagship will be the A350 not the A380 because size isn't nescesarily better.

Forget it, the flagship is and is going to be the A380.

Depends also how long the old B747s, Il-96, Tristars and MD-11s will last? The creation of the B748 showed that people think the "bigger is better" idea in a world with increasing airtravel and limited slots at high-congested airports a crucial
point

Quoting Ikramerica (Reply 4): Quoting Scorpio (Reply 2): Only in those markets where there is a composite alternative. A much more cost efficient A350-900 or 1000 is a composite alternative.

Can you demonstrate how two A350-900 are 'a much more cost efficient' alternative to one A380?

Quoting BillReid (Thread starter): This is not a A vs. B thread. This is a thread to discuss the competency of John Leahy (or if his koolaid is bad).

I find Leahy to be an extremely good salesman - indeed one of the best in the world. And as such one of the main reasons why AB is where AB is today. His biggest problem seems to be that he is such a very typical American....


Abba

Quoting Abba (Reply 9): I find Leahy to be an extremely good salesman - indeed one of the best in the world. And as such one of the main reasons why AB is where AB is today. His biggest problem seems to be that he is such a very typical American....

So should you not be thanking America for Airbus? Seems you are a bit ungrateful.

Quoting Scorpio (Reply 2): As long as nobody builds a composite plane in the size category of the A380, that point is pretty moot...

Are you leaving economics out of the equation. What happens when fuel drives costs to a point where two A350's may be cheaper to operate than one A380? Not sure this is possible but I assume there is a crossover point.

Quoting A342 (Reply 5): Forget it, the flagship is and is going to be the A380.

The problem with this statement is that the A380 is a niche aircraft and will only be logical on a select number of routes which it is suited for and there for not really a flagship type.

Quoting Kaitak (Reply 3): If the Internet was around 35-40 years ago and someone told you that the 747 would sell 800, let alone 1,400 units, you'd probably have had them carted away to a funny farm (or just told them they were talking nonsense, which would probably save a lot of paperwork), but look what's happened ...

Except until the last half of that time, there weren't any other aircraft that could even fly the routes the half-full 747 did. Now airlines can fly fuller, smaller planes on the same routes.

Between the rise in point-to-point and longer range, smaller aircraft being capable, it'll be harder to justify the A380 to the point where the world will need more than 400 over the next 20 years. Anyway, that's still 20/year--not bad.

Quoting Kaitak (Reply 3): If the Internet was around 35-40 years ago and someone told you that the 747 would sell 800, let alone 1,400 units

- why not? I'd rather be surprised to hear then that a bigger one will appear only in almost 40 years...

Quoting Abba (Reply 9): His biggest problem seems to be that he is such a very typical American....

- that is, smart, professional, courageous, business-driven, bold...by far an MVP of a European company he works for through all the period of its existence  ... Why is it a problem though?

In order to sell that many A380s would it not require AA say to purchase something like 50+...that will never happen...

Quoting EXAAUADL (Reply 18): In order to sell that many A380s would it not require AA say to purchase something like 50+...that will never happen

That's right, an aircraft programme can never succeed without an American airline buying it   There's 60-65? bound for the Gulf states....and if EK (in the guise of Tim Clark) really means they could double their fleet, that then takens the total to at least 115-120. Add in the options that could be taken up means another 15-20? Tag in some replacements 15 to 20 years down the line (perhaps A380-900 replacing A380-800) could see another 50-100, throw in the A380F (for FedEx and UPS) and there's another 10-15.

Doing a rough calculation, we have: 165+55+15+50+10= 295 orders (going to 355 at the high end of my predictions?). So another 450-500 orders to get.

Quoting David_itl (Reply 19): That's right, an aircraft programme can never succeed without an American airline buying it There's 60-65? bound for the Gulf states....and if EK (in the guise of Tim Clark) really means they could double their fleet, that then takens the total to at least 115-120. Add in the options that could be taken up means another 15-20? Tag in some replacements 15 to 20 years down the line (perhaps A380-900 replacing A380-800) could see another 50-100, throw in the A380F (for FedEx and UPS) and there's another 10-15. Doing a rough calculation, we have: 165+55+15+50+10= 295 orders (going to 355 at the high end of my predictions?). So another 450-500 orders to get.

I think David has it right in his post...

Further: It is not clear to me how / why EK will operate so many of this type and I wonder if some of the follow-on demand won't end up being served by EK leasing out A380s that in their purchase obligations from Airbus. I guess we will see how EK turns out -- but I really suspect that they will become a major force in commercial transport but that they will use A350/787 more effectively than they can use the A380. This is predicated on a whole slew of assumptions in my head, so it is a definite wait and see.

This does not say anything negative about the A380 as an aircraft, so please don't combine my comments with my nation's flag and brand me an idiot.

Quoting Abba (Reply 9): I find Leahy to be an extremely good salesman - indeed one of the best in the world. And as such one of the main reasons why AB is where AB is today

The main reason why the man touches so many nerves here on A.Net...

Quoting A342 (Reply 5): Forget it, the flagship is and is going to be the A380.

The main reason why the plane touches so many nerves here on A.Net...

Quoting EI321 (Reply 8): Can you demonstrate how two A350-900 are 'a much more cost efficient' alternative to one A380?

I did NOT say that the A350-900 was definitely more cost efficient. I said that a much more cost efficient pair of A350-900s WOULD be an alternative. And I tried not to even mention a Boeing product so I wouldn't ruffle any feathers. Guess it didn't work.

Airbus is claiming the A350 family is much more efficient than the 777 and even than the 787. By some measures, the 77W is currently the CASM leader. The A380 will surpass it shortly (but doesn't have the belly cargo matching ability), but the 787 may match that A380 in efficiency. If the A350 is more efficient than the 787 as Airbus says, then it's more efficient than the A380 too. Airbus can't have it both ways by claiming two planes are both the most efficient in the air, nor can Boeing (with the 748 and the 787), though both try to.

So, if the A350-900 is more efficient AND it can carry more cargo (2 A359s will carry far more belly cargo than one A380 based on volume, passenger luggage and payload) then the revenue potential on routes that are not slot limited would favor the A350s.

Quoting BillReid (Thread starter): I want a.netters to chime in on the longevity of Metal Aircraft Sales and if they will go on for two decades as Leahy suggests?

Yes, they will. CFRP is great for a cleansheet design but it's very difficult for a retrofit. Several metal aircraft in the works now are still going to be in production in twenty years and they're not going to switch to CFRP midstream.

Quoting Brilondon (Reply 13): The problem with this statement is that the A380 is a niche aircraft and will only be logical on a select number of routes which it is suited for and there for not really a flagship type.

That's pretty much the definition of a flagship...that rare, impressive, spectacular craft that you only have a few of that only does routes that nothing else can (i.e. a niche).

Tom.

Quoting BillReid (Thread starter): This is not a A vs. B thread. This is a thread to discuss the competency of John Leahy (or if his koolaid is bad).

for a minute i thought what you were asking for was impossible. So far, at least, your wish is granted

Quoting Ikramerica (Reply 4): For example, if you can fly 2 A350-900s on a route with a better CASM and better cargo revenue, you would do so unless the route was slot controlled. Which means there is a market for the A380, but not an infinite one.

Consider that the world is constantly changing. The projection of 800 A380 seems like a real possibility over what we know as reality today.
The reason I say that is investment follows human traffic. Smart investment draws human traffic. So it is conceivable that several airports take a punt and invest for 380s to operate, in order to generate traffic. Traffic equals possibility in increased spending.

So it is quite conceivable that Turkey, for example, once allowed into the European Community will build up its tourism industry by investing in airport infrastructure to include 380s and build up wholly new cities for people to inhabit. Soon that one airport develops into a hub.

I cite Dubai as evidence of such a phenomenon. Which national airline has the largest order for the 380?
Then what if the investment is there but the intention is not tourism but something else?

Quoting M27 (Reply 10): So should you not be thanking America for Airbus? Seems you are a bit ungrateful.

Forever grateful, without Boeing there'd be no Airbus, without Leahy there'd be a different Airbus and not the oneI love right now.

Quoting Ikramerica (Reply 21): but the 787 may match that A380 in efficiency

That's news to me.

Quoting BillReid (Thread starter): Large Metal Aircraft sales will be effectively obsolite within 5 years after the A350 has been completed. Ecomonics will dictate the change from Metal to Composite.

45% of the 787 are metal. I think calling the aircraft obsolete is a bit far-fetched.

Quoting David_itl (Reply 14): That's right, an aircraft programme can never succeed without an American airline buying it

While original " In order to sell that many A380s would it not require AA say to purchase something like 50+" is totally pointless, your reply is hardly more relevant. He did not say to what you are trying to reply.

Quoting David_itl (Reply 14): So another 450-500 orders to get.

- the way you put it, sounds like sarcastic denial rather than statement  ... In no way arguing with it, very well may happen...

Quoting A342 (Reply 4): the flagship is and is going to be the A380

- why?  

I suspect Leahy knows that this and many of his other comments are not really based in fact. His intended audience is not the aviation community - it is financial analysts and journalists, and to a lesser degree individual stock owners. They don't know any better, so they cannot really tell a thoughtful opinion based on fact from just wild hopeful speculation. When they have expertise at all, it is in salesmanship and financial matters. Only a few know much about airline specific economics. However, they influence billions of Euros/Dollars in stock transactions every day. Their decisions have a great deal of influence on how much money EADS can raise and under what terms. The markets have an even greater influence on the personal wealth of someone who is paid partly in stock options - and I wouldn't be surprised if Leahy gets options in EADS....

Quoting Wsp (Reply 20): Quoting Ikramerica (Reply 21): but the 787 may match that A380 in efficiency That's news to me.

On the basis of fuel efficiency, it's certainly true. And that's a big slice of the CASM pie.

The A380 will have to be stretched and re-engined to match the largest 787s and A350s. Not to worry, if they ever sell 800 of them this will certainly have happened  

Quoting BillReid (Reply 9): Are you leaving economics out of the equation. What happens when fuel drives costs to a point where two A350's may be cheaper to operate than one A380? Not sure this is possible but I assume there is a crossover point.

The A380 fuel burn per seat (525pax) is not too bad compared to 787/350 generation aircraft. The economics of scale goes some way towards evening out the weight efficiency of the 787/350. When Airbus puts the Trent XWB onto the A380 (which is 5-7% better in SFC) the A380 fuel burn performance we be more than equal to 787/350.

Put the Trent XWB engines onto the A380-900 and add in a weight reduction exercise and this variant will be an excellent aircraft.

Quoting EXAAUADL (Reply 13): In order to sell that many A380s would it not require AA say to purchase something like 50+...that will never happen...

AA is not needed, Asia and the Middle East is the market. In North America I can only think of UA and NW that may have a need for it.

Quoting M27 (Reply 8): So should you not be thanking America for Airbus? Seems you are a bit ungrateful.

Certainly not! But I do not thank America for Airbus but for Leahy (while I at the same time find it exceptionally funny that Leahy is being attacked as being typical American (he likes to overstate things) by Americans in a very American way!)

Quoting Brilondon (Reply 10): The problem with this statement is that the A380 is a niche aircraft and will only be logical on a select number of routes which it is suited for and there for not really a flagship type.

No - the 737/320 is the real and true flagship as it covers the most routes by far!!!!!!

Quoting Vega9000 (Reply 16): The main reason why the man touches so many nerves here on A.Net...

So very true!!

Abba

Quoting BillReid (Thread starter): This is not a A vs. B thread.

Why did you mention this? Even if it were so what?


Anway 800 A380 is quite possible, but A380 should be renewed with new technologies, the current A380 isnt really so new

800 would actually be a low number, I think it will be more like 1,000 over 25 years, including variants like the A389, A388F, A389F, A388ER, A389ER.

Quoting Thorben (Reply 28): 800 would actually be a low number, I think it will be more like 1,000 over 25 years, including variants like the A389, A388F, A389F, A388ER, A389ER

I agreed.

Also if Airbus can get the A388R with trent XWB engines to fly 9500nm for year round LHR-SYD with 525pax and a reasonable CASM they will have a "game changing" aircraft.

Not too sure if EK would be pleased if such an aircraft was developed.

Quoting BillReid (Thread starter): This is a thread to discuss the competency of John Leahy (or if his koolaid is bad).

Lets use recent key performance indicators for that, rather than future appreciations, shall we?

A350XWB to wing 200 firm commitments this year:   
A380 to sell 20 firm commitment this year:   
A380 to get 2 new customers this year:   
787 to be delayed by 6 months:   

Quoting Slz396 (Reply 30): Lets use recent key performance indicators for that, rather than future appreciations, shall we? A350XWB to wing 200 firm commitments this year: A380 to sell 20 firm commitment this year: A380 to get 2 new customers this year: 787 to be delayed by 6 months:

That's JL for you. Like Tim Clark or SUH, when he opens his mouth people react. He has been closer to the mark this year than many care to admit, but he has also had his share of gaffes like when he said the 350 windows were bigger than the 787 and yet could not say how big they were. It turned out that the 787 had bigger windows. A classic example of 'mine is bigger than yours' gone wrong!

Quoting HawkerCamm (Reply 24): The A380 fuel burn per seat (525pax) is not too bad compared to 787/350 generation aircraft.

Is there a table somewhere that shows the per-seat fuel burn of different aircraft?

Quoting BillReid (Thread starter): Large Metal Aircraft sales will be effectively obsolite within 5 years after the A350 has been completed. Ecomonics will dictate the change from Metal to Composite.

The A380 is 25% CFRP and in itself a major part of the long process where the advanced-materials fraction of planes increases.

Quoting Brilondon (Reply 10): The problem with this statement is that the A380 is a niche aircraft and will only be logical on a select number of routes which it is suited for and there for not really a flagship type.

Here we're discussing what's meant by a flagship plane. Concorde was BA's flagship and it was very much a niche product in their portfolio and I understand SQ intends to have the A380 Superjumbo as their flagship.

Quoting HawkerCamm (Reply 29): Not too sure if EK would be pleased if such an aircraft was developed.

BA and QF certainly would not mind.

Quoting Brilondon (Reply 10): Quoting A342 (Reply 5): Forget it, the flagship is and is going to be the A380. The problem with this statement is that the A380 is a niche aircraft and will only be logical on a select number of routes which it is suited for and there for not really a flagship type.

And if the number of hubs grows? I don't see all growth in point to point. I see both hub to hub and point to point growing, so I think the number of VLA niche routes will grow.

Quoting EXAAUADL (Reply 13): In order to sell that many A380s would it not require AA say to purchase something like 50+...that will never happen...

What about all the long haul airlines (especially Asian) that do not yet exist but will be started in the future? All the indications are that there will be a very large market for ex-Asia tourism in the coming years. To tap this market, these new companies would want to sell on price. Will anything compare with the economics of the A380-900 shipping 800+ pax from A to B? I don't think so.

Quoting Abba (Reply 7): His biggest problem seems to be that he is such a very typical American....

Could you expand on this please? Is this a compliment or an insult?

Quoting HawkerCamm (Reply 29): Also if Airbus can get the A388R with trent XWB engines to fly 9500nm for year round LHR-SYD with 525pax and a reasonable CASM they will have a "game changing" aircraft. Not too sure if EK would be pleased if such an aircraft was developed.

Probably not. But the CASM would still be extremely high, due to the massive fuel load. And there wouldn't be too many direct connections. I would rather fly TXL-DXB-SYD then TXL-LHR-SYD, in order to have two medium long flights instead of one short and one endless.

Quoting Slz396 (Reply 30): A380 to get 2 new customers this year: checkmark

Yes, if you split Marsans into 2 for AR and 2 for A7, which is how I understood it.

Quoting Thorben (Reply 37): Quoting Slz396 (Reply 30): A380 to get 2 new customers this year: checkmark Yes, if you split Marsans into 2 for AR and 2 for A7, which is how I understood it.

Err....that would be 3 if you split Marsans order into 2 airlines! Or has BA's order momentarily been overlooked by yourself?

Quoting RIX (Reply 21): Quoting David_itl (Reply 14): So another 450-500 orders to get. - the way you put it, sounds like sarcastic denial rather than statement

Really? Lots of scope for various airlines to order it over the next 20 years or so - only a mximum of 25 per year and I don't thnik they'd be bothered if took another 30 ailrlines to reach 450-500 new sales.

Quoting David_itl (Reply 38): Err....that would be 3 if you split Marsans order into 2 airlines! Or has BA's order momentarily been overlooked by yourself?

Yes, because it isn't firm, yet.

Quoting Thorben (Reply 39): Yes, because it isn't firm, yet.

Neither is the Marsans order yet....

Quoting Moo (Reply 40): Neither is the Marsans order yet....

Yes, I know.

Quoting Thorben (Reply 41): Yes, I know.

So why is the BA order worth overlooking, but not the Marsans order? Or conversely why is the Marsans order worth including and the BA order not? I'm not getting your logic here, it doesn't seem consistent.

Quoting Rbgso (Reply 36): Quoting Abba (Reply 7): His biggest problem seems to be that he is such a very typical American.... Could you expand on this please? Is this a compliment or an insult?

- see my Reply 12, I expanded it for him. He has definitely nothing to object  ...

Quoting David_itl (Reply 38): Quoting RIX (Reply 21): Quoting David_itl (Reply 14): So another 450-500 orders to get. - the way you put it, sounds like sarcastic denial rather than statement Really? Lots of scope for various airlines to order it over the next 20 years or so - only a mximum of 25 per year and I don't thnik they'd be bothered if took another 30 ailrlines to reach 450-500 new sales.

- I said, "the way you put it, sounds like sarcastic denial rather than statement  ... In no way arguing with it, very well may happen...". Clearly commenting not on the subject but on the way you said it, which in funny way looked like an ironic opposite to what you were really saying. My apologies if I got personal, but, still, please quote my entire remark when answering: its second part makes your reply entirely irrelevant.

Quoting BillReid (Thread starter): Large Metal Aircraft sales will be effectively obsolite within 5 years after the A350 has been completed. Ecomonics will dictate the change from Metal to Composite.

NNNNNNNNNOOOOOOOOOOOOOO!!!!!!!!!!!!!!!!!!! What about poor AA!? Oh well, they'll figure it out, yawn.

Quoting Moo (Reply 42): So why is the BA order worth overlooking, but not the Marsans order? Or conversely why is the Marsans order worth including and the BA order not? I'm not getting your logic here, it doesn't seem consistent.

It isn't "worth" overlooking BA's order, I just overlooked it.

Quoting Brilondon (Reply 10): The problem with this statement is that the A380 is a niche aircraft and will only be logical on a select number of routes which it is suited for and there for not really a flagship type.

The same could probably be said of the 747. Please bear in mind though Boeing figured they'd sell from 500-600 747s before sales ended. Actual sales went far beyond even their wildest dreams. The same may well be true for the A380 once it gets into service and its benefits are realized. Only time will tell.

Quoting Alessandro (Reply 5): Depends also how long the old B747s, Il-96, Tristars and MD-11s will last? The creation of the B748 showed that people think the "bigger is better" idea in a world with increasing airtravel and limited slots at high-congested airports a crucial point

I agree that the likes of the 747 the 767 and even the older 777's may not go out of service for a while:

1) Regardless of the fact that boeing and airbus may produce 10 787's, A350's a month, they are already delayed with complications due to the manufacturing processes (especially boeing with its global team), and so getting to that production yeild for each company will not occur any time soon at all/ Therefore airlines will not be forced, or be pressured to get rid of aircraft too quickly to accommodate the 787 or A350.

2) Relating to the first point such that existing aircraft may be crucial to future economic success, is that maintenance engineers will have to be thoroughly trained to maintain the new composite aircraft, and in my opinion, this will take time, purely because of the CFCP. Therefore, the existing aluminium aircraft will still be necessary for their sake.

3) When regarding the A380... entirely plausible scenario... "An A380 is stranded in singapore, meaning 500 people are going to miss flights, and connecting flights, solution?" Existing aircraft would be vital in this scenario, due to the low likelyhood of singapore having a spare A380 taking up space on the ramp, or in one of the hangars!!

Back to the main subject. Leahy predicts 800 A380 sales. Is this unreasonable? The answer depends on one factor: time. If leahy predicts that emirates will buy 400 A380's next year, then we'll put him in the wheelbarrow, and take him to the hospital for a brain scan. If he states that there is a high probability that sales will reach these figures through sales distribution over 50-60 years, then theres nothing wrong with that at all. Case in point, the Boeing 747.

Quoting EI321 (Reply 6): Can you demonstrate how two A350-900 are 'a much more cost efficient' alternative to one A380?

Different countries means different markets. Why did ANA order a lot of 787's, and no A380's.

In japan, the high density domestic characteristic, coupled with the fact that it costs a lot to keep very heavy aircraft on the ground in a japanese airport, means it is more economically efficient to use smaller 777-3ER's/A350's/787's/767's more frequently, than an A380 less frequently.

Of course this works both ways; Air France, Lufthansa have ordered the A380, yet have ordered no A350/787, purely because flying the A380 less frequently will be more economically efficicient for them due to the routes they fly.

Quoting CJAContinental (Reply 47): Different countries means different markets. Why did ANA order a lot of 787's, and no A380's.

Well because no airline will replace their 767s with A380s.... but anyway.... maybe JAL would have been the better airline to support your point.... cos unlike JAL ANA has repeatedly stressed that they might consider the A380 in the future, if competition will make it necessary.

Quoting Abba (Reply 26): No - the 737/320 is the real and true flagship as it covers the most routes by far!!!!!!

Well, "flagship" isn't the aircraft that is used the most by an airline.... the A320/737 might rather be the workhorse of the airline having one of the mentioned aircraft type and the A380.... Non of the airlines having 737/A320 and 777/747/A380 would call the A320/737 their flagship.

Quoting BillReid (Thread starter): Large Metal Aircraft sales will be effectively obsolete within 5 years after the A350 has been completed. Ecomonics will dictate the change from Metal to Composite.

Looking at the CASM out of the 787/A350/A380 the A380 will most probably have the best CASM.... maybe the A351 will come close or be a bit better. However, we will only see how that turns out, when all these aircrafts are in service. If you put cargo into the equation the 787/A350 will most probably the better aircraft, as they will have more spare cargo space.

GlobeEx

[Edited 2007-10-13 08:53:24]

I picked 380 for the total built in the "guess how many" thread, so I hope Leahy is at least half right this time.