I would like to know if anyone has heard of firm orders for the aircraft from UAL, AA or DL. Is Airbus taking firm orders at this time?

No, AA, DL, and United are not in talks with Airbus about the A3XX at all. If they are going to get a superjumbo, it would definetly be the 747X. United will probably be the launch customer for the 747X. Delta has been talking about ordering a few 747-400's as well.

These airlines will definetly not order the A3XX.

Are any airlines holding firm orders for the XX?
Also, what are your opinions regarding the cabin structure on this a/c? I have seen a QTVR video image of an "idea" for the first class area. This looked more like a cruise ship than an airplane! Do you think any airlines (maybe SIA?) will go this route of ultra-luxury, Ritz-Carlton flying planes? It seems like a very nice idea, now that they have more room to play with, but on the same hand, more room means hundreds of additional, revenue generating seats could be added.
I am thinking that when the rubber meets the road, airlines will not use the A3XX for ultra luxury, but rather fill it up with more seats.
What are your thoughts?

Virgin will certainly do something, if only initially, as it will milk the A3XX for all its worth - expect an order before the end of the year now SIA has ordered.

Go back to 1970 and look at the 747 for your answer. Piano Bars, lounges etc. were all the rage until the airlines sold the space and filled the seats.

Boeing747-400,

United is known to be very interested in A3xx and is definitely in talks with Airbus about the plane. They have been wanting a bigger plane for a long time now.

Women_fly_too,

The First class mock-up us just that, a first-class mockup. First class has much room per seat and very few seats compared to the other classes. The recent trend is precisely to decrease the number of seats and increase luxury and personal space. Since First class takes so little space to begin with, how it's organized will never take "hundreds" of other seats. Besides, those passengers pay their way.

Joni,

United will not order the A3XX. They have expressed more interest in the 747X than the A3XX, according to a family member (who works for Boeing) and Boeing itself. I can assure you that United is not in strong talks about the A3XX.

Besides, according to United, they want to keep their long-haul fleet all Boeings and not change to Airbus. This will save them a lot of money, a lot.

Joni,

In fact, the image I saw of the XX interior would take up at least 100 seats. This mockup looked like a hotel lobby. It had guest suites (enclosed rooms) with individual bathrooms (showers included). When I saw it at first, I thought I was looking at a cruise ship!
Also included was a bar and lounge (like the 747's back in the old days, but much more luxurious)

I was watching a show on cable this morning and they were talking with some avaition consultants(dont know who) and a woman from Airbus. They were saying, except the woman from Airbus that airlines will not have them as ultra luxurious, instead they would use that space for more seating and if that seating is not filled they will use it for cargo, that is what they were saying, and that basically it will just be the same as a normal a/c but with many more people in it.

Oh really?

Then can you explain the joint UAL/Lufthansa A3XX talks going on. Nothing 'serious' of course. I have to laugh at the denial out there. Hahahahaha.

This 'family member' is working for Boeing, how does he know the decisions --UAL-- (not Boeing) will make? Does he sit on the executive board of UAL too? (G)

MAC


Boeing747-400 wrote:
-------------------------------
Joni,

United will not order the A3XX. They have expressed more interest in the 747X than the A3XX, according to a family member (who works for Boeing) and Boeing itself. I can assure you that United is not in strong talks about the A3XX.

United Airlines has expressed interest in the A3XX. I spoke with my next door neighbor who is a United pilot and he even told me that United has expressed interest in the A3XX.

I believe that UA and LH were among the airlines that worked with Airbus on the design of the A3XX.

I think UA may make a decision to buy the A3XX, but it won't come until the 2002 time frame for 2007 deliveries. The reason is simple: UA is most likely looking at airplanes with larger pax/cargo capacity for flights between the USA and eastern Australasia (JFK-NRT, ORD-NRT, SFO-NRT, LAX-NRT, JFK-HKG, ORD-HKG, LAX-HKG, SFO-HKG, LAX-SYD, and LAX-MEL), and may consider buying as many as 25-30 A3XX's for this purpose.

Because SQ owns 49% of VS, I expect VS to likely now order 10-15 A3XX's for their long-range service. And that may force BA--despite their public remarks about not wanting the A3XX--to also seriously consider buying them also.

Victor Hotel wrote:
-------------------------------
I was watching a show on cable this morning and they were talking with some avaition consultants(dont know who) and a woman from Airbus. They were saying, except the woman from Airbus that airlines will not have them as ultra luxurious, instead they would use that space for more seating and if that seating is not filled they will use it for cargo, that is what they were saying, and that basically it will just be the same as a normal a/c but with many more people in it.

Victor Hotel

It's no secret (and reported in Newsweek) that many current 747 operators desire a new airplane to deliver a new type of service level. They have been quietly complaining that the 747 just doesnt cut it anymore as a platform for First and Business Class. This is what was reported in Newsweek.

Now with that in mind, and then referring to what SIA's own people referred to in the order announcement that they -want to explore the A3XX's new capability to define a new level of service-..what does that mean?

It means they are going to use the A3XX to make an INCREDIBLE First and Business class product. Airlines competing with SIA will have to reply somehow. And guess what that probably means? Ordering A3XX's. If you are in the boardroom of MAS at Kuala Lumpur and your --biggest-- competitor 'down the pike' is going to be operating A3XX's..potentially trumping -anything- you have to offer. Good Gawd! What is the best way to respond? Ordering A3XX's.

The implications of this --stunning-- coup Airbus Industrie has scored is not at all to be sneezed at. To do so is foolish to the umpteenth degree. It's got to be sending seismic sized shockwaves in the richter scale level of 9.5 up the spines at Boeing right now. They have been for too long denegrating the A3XX and attempting to deny a need for it. The marketplace is reacting now and indeed it's rejecting that rhetoric. A lot of time -wasted- also on their part. Silly if you ask me.

Regards
MAC

Joni, MAC_Veteran, RayChuang are right. I even emailed Airbus and they said United has showed lots of interest for the A3XX and were among the airlines that worked on the design as RayChuang said. Now I know Airbus wants to sell the A3XX to as many airlines as they can, but they are honest. If they say United has shown interest in the A3XX, then United has shown interest on the A3XX. They don't give out false information. As you can see, Joni, MAC_Veteran, RayChuang also say that United is interested in the A3XX. Now thats a big majority, now all of them can't be wrong. I even asked my next door neighbor who works for United. Now thats the best evidence you can get, that United is interested in the A3XX.

Ray Chuang,

Where do you get this from pls?:

"Because SQ owns 49% of VS, I expect VS to likely now order 10-15 A3XX's for their long-range service. And that may force BA--despite their public remarks about not wanting the A3XX--to also seriously consider buying them also."

Take the first phrase. Whilst SIA has a large input now into Virgin's decisions, through its board members they, under UK law, have to act in the interests of Virgin, not to the dictats of SIA.

10-15 A3XX? Well maybe by 2012 but Virgin operates on highly competitive routes. Those that could sustain A3XXs will have competing carriers and the decision on how many to order will depend on the market for seats to JFK, EWR, LAX, SFO, ORD and HKG, plus any breakout into the Australian market.

With 28 aircraft on strength this summer and the A340-600s still to come (which will replace 747-200s and trickle down 400s onto routes currently run with 200s and the current A340s) and the fact that they have a projected life of 10-12 years in service, I can see an initial order for 3-5 A3XX plus options on another couple or so, initially in a very high profile role, with about 10% more seats than a 747-200srs, plus anything from a gymnasium to a shopping mall. or both, on board.

Going by Virgin's history, it will soon fill any A3XX with as many seats as it can, whilst maintaining its exceptional standards.

As for BA, they will eventually sort themselves out but the A3XX doesn't fit the "business class led" airline of Bob Ayling's days and, whatever cosmetic changes BA are carrying out at present, they have to totally rethink their strategy before investing in anything larger than a 777

As a CPA and businessman, I believe that everyone seems to have lost touch with economics in the discussion with the A3XX. They also have lost touch with the fact that both Boeing and Airbus have made critical and very gutsy decisions on this one.

Boeing is betting that the market has changed and that the number of potential sales will not support the cost to develop an all new superjumbo and that its research and funds can be put to better use in other segments of the market.

Airbus is taking the route that Boeing did in the late 60s early 70s and "betting the ranch" on this one. Airbus will be diverting funds from doing meaningful updates to the A320 family and developing a real competitor to the 777 for the next five to ten years. The A3XX will sell, it should be a great plane and it will make its operators happy. The question is how many sales and over what time period. That is the real problem.

Comments have been made that this is parallel to the situation when Boeing "bet the ranch" and introduced the 747. The problem here is that there are different factors that were not in play back then. Following are some of the things that are different between then and now.

1) Airlines had nothing like the 747 in their fleets so there was not the option to add newer versions of the same aircraft for which your pilots, FAs and mechanics already are trained. For a 747 operator to move to the A3XX, they must endure the cost of retraining their entire crews (which includes overstaffing during the training period) and run a dual fleet of two types of aircraft during the conversion period.

2) When the 747 was introduced, there was nothing even close to it in the market (no competition). As such, there was no option to the airlines and Boeing could make a very big profit on the 747. Now there is competition and. to pay back the previously discussed fleet conversion costs, either the operating savings of the new aircraft have to be substantial or the initial cost has to be substantially lower than the competition. I believe that Boeing is developing the 747X with the primary intention of making sure that Airbus finds it difficult to achieve the desired profit margin on the A3XX while keeping some market share.

3) With regulated airspace, use of international hubs with feeder systems and a general lack of competition on routes, it made more sense to add seats by going to larger aircraft than to add flights. It made more sense to TWA or Pan Am to fly people into New York in 727s and load them onto 747s for Europe. Today, as technology provides us with smaller aircraft with dramatically increased range, the movement is to more frequency of flights in smaller aircraft. In the 70s and early 80s, 747s dominated the Northern Atlantic. Now those routes are dominated by 767s and A330s since the market has fragmented with many more "gateways." Domestically in the US, 737s, 757s and A320s have replaced 767s, L1011s and DC10s on the transcontinental flights for the same reasons. This would indicate that the market for the A3XX is not as big as the original market for the 747. Boeing is betting that the future is in the 767 / A330 / 777 market segment for long distance widebody twins.

In closing, my prediction is that the A3XX will sell and will be the dominant superjumbo. The problem is, it will not sell in numbers even approaching break-even for Airbus. I also predict that the 747X will sell, but also in relatively low volume. I believe that Boeing will have trouble breaking-even on it. Most of the old 747 market is and will continue to go to the 767, 777, A330 and A340. In the wide-body long distance market segment, that is where the money will be made in the next 20 years.

If anyone disagrees with my market assessment, feel free to provide a list of A3XX buyers with a realistic list of how many planes each will buy. I tried to put together such a list and it doesn't add up for either manufacturer.

Realistic? By 2010

EK 5
SQ 10-25
QF 10-12
Leasing companies 10-15
AF 10
VS 10
FX 15

B747 str
CX 4-8 (freighters)
BA 12
Atlas 10
Cargolux 8
KE 6 freighters
BR 8 freighters


After 2010 the numbers change, By then the first B744 will be 22 years old and ready for a change.

This is the big gamble, Boeing are holding off on a B744 replacement (because it is 10 years away, and as you say, the market may fragment anyway) AI is going with a early replacement, before anyone really wants to send the B744 to the desert (the depreciation periods are about 20 years, so anyone retiring a B744 early is going to take a nasty write down)

So until the B744 go to the desert, A3XX will be a sloooow seller. After that, it should do much better as carriers start to replace their 744. Boeing are betting this will be with B777, AI with A3XX

Philly phlyer,

It's very difficult to put together a list of A3xx buyers for decades to come, since airlines and their strategies come and go. However a few points in your commendable traffic analysis deserve attention.

Crossing the Atlantic on an A3xx in economy class is substantially cheaper than doing so in a 767 economy class. Also, A3xx business class will have fully reclining seats, which are a boon on overnight flights. One reason smaller twins (widebodies twins) have becoem popular over the pond is that they haven't been essentially costlier to fly on than 747. A3xx will give cheap tickets, and for most passengers that's a very important point.

Ticket price, unlike some people seem to think, does impact on business travel as well. Now that secretaries don't type memos anymore, they spend a lot of time negotiating with travel bureaus to determine the cheapest way to travel for their colleagues. Naturally, sometimes schedules simply are too tight to allow for selecting from very many options, but often they are not.

To cap this up, we can say that A3xx is ideal for transporting people between large cities at low cost and good comfort. Whatever the future holds, it's not unreasonable to assume there will be a good market for that kind of product. A more detailed breakdown would IMO require a professional. This isn't an exact science.

PhilB,

It was almost but confirmed in the SIA announcement that that SIA's decision would influence VIR's decision (read earlier interviews).......and realistically, I agree, whether BA like it or not, they will have to follow.........

Joni:

I do not believe you understand what I am saying about market fragmentation. As I alluded to above, until the early 80s, to get to Europe from the US you generally had to fly through BOS, JFK or one of the other few Atlantic gateways and the market was dominated by 747s, DC10s and L1011s. With increased range twins and more routes authorized (technology and deregulation) the market shifted dramatically to 767s and A310s (now including 777s and A330s) with nonstop routes to more and more US cities. A few carriers even are using 757s now! As a result, there are some 747s over the Atlantic, but they are in the minority. This is not some example of "strategies that come and go" as you mentioned, but is a trend that has been industry-wide over the last twenty years.

There will be some carriers that will use the A3XX on some of the very high density North Atlantic routes at peak times, but the last thing a carrier in business to make money wants to do is to fly empty seats. You state that "crossing the Atlantic on an A3xx in economy class is substantially cheaper than doing so in a 767 economy class." This is only true if every seat is full. If the A3XX seats are not full, then the 767, A330 and 777 become much cheaper to operate.

You also state that "A3xx business class will have fully reclining seats, which are a boon on overnight flights." This is a carrier preference and could be put into the current planes flying over the Atlantic. Seats and pitch are determined by the carrier. The greater the pitch, the fewer the seats and the more you must charge for each seat. That is true of every plane.

You also state that, "one reason smaller twins (widebodies twins) have become popular over the pond is that they haven't been essentially costlier to fly on than 747. A3xx will give cheap tickets, and for most passengers that's a very important point." I agree wholeheartedly that most passengers find the cost of their ticket important. At the same time, most passengers will pay a little more to fly nonstop instead of changing planes at BOS or JFK. The reason that the twins are flying over the Atlantic is that they are substantially cheaper to fly on these routes and do provide the cheapest seats based on the going load factors. The market (load factor) drives which plane is utilized on a given route. If your market averages 200 passengers a flight, which is cheaper to fly, a 767 or 747? Empty seats are not just lost revenue, they are additional and unwanted cost in a highly competitive environment.

I agree with your point that "ticket price, unlike some people seem to think, does impact on business travel as well." [See my point above. The twins provide cheaper seats in a fragmented market.] I have respectifully have to disagree with your comment "that secretaries don't type memos anymore, they spend a lot of time negotiating with travel bureaus to determine the cheapest way to travel for their colleagues." In most medium and large companies, the travel discounts have been negotiated and contracts signed with specific carriers. The same companies then either have inhouse travel agencies or contracts with outside agencies to monitor this and provided advice.

xxxxxxxxxxx

Lufti:

You're coming up with roughly the same numbers that I came up with for the A3XX. I do not disagree. My point is that this is not enough to even get close to break-even. What I'm trying to say is that I believe that the market is shifting to the smaller jets as the smaller wide-body twins (767, 330 & 777) as well as the 340 will command a much bigger market.

The reason 747 sales have been sliding is because it has too many seats for most markets, not because it is based on an older design. If the demand for seats was there, the sales would have been there. It has had no competitor so the slow sales reflect a decline in the market, not the plane.

United would have to be very ignorant to order the A3XX. I know AA and DL won't. But United is one of the largest 747 operaters. They operate no big Airbus's and would save a lot of money with the 747X. This would include operations, pilot training, fuel, etc. Switching to Airbus for long-haul would be so stupid for United. They operate so many 767's, 777's, and 747's, it would make no sense at all for United. Sure, they have expressed interest in the A3XX, but they have more in the 747X. Don't be expecting an order from United at all for the A3XX, sorry.

Boeing 747-400

Your remarks echo those made in SoCal about 42 years ago when Douglas was telling everyone that United wouldn't be buying Boeing jets as it historically bought Douglas and was wedded to the DC8 as the latest in the line of Douglas products flown by UAL.

So, as the lead company ordering the B720, B727 and lead US company for the B737 and having started to switch from Boeing to Airbus for the shorthaul fleet in the 1990s, United obviously knows more about the economics and logistics of switching suppliers than you.

You are SPOT on!

Another point that is worth adding to that is McDonnell Douglas thought the DC-10 and DC-8 Super Sixty series would "negate the need for the 747". Look what happened after that? (G)

Regards
MAC

PhilB wrote:
-------------------------------
Boeing 747-400

Your remarks echo those made in SoCal about 42 years ago when Douglas was telling everyone that United wouldn't be buying Boeing jets as it historically bought Douglas and was wedded to the DC8 as the latest in the line of Douglas products flown by UAL.

So, as the lead company ordering the B720, B727 and lead US company for the B737 and having started to switch from Boeing to Airbus for the shorthaul fleet in the 1990s, United obviously knows more about the economics and logistics of switching suppliers than you.

PP:

The number of passengers on a route depends on the prices. Introducing a larger plane with low cost per seat moves traffic from fragmented routes to trunk routes. Obviously A3xx won't end point-to-point flights, but it won't have to fly empty over the Atlantic either. Look at the routes AF plans to use the plane on.

Regarding fully reclining biz seats, yes seating is carrier-specific but a larger floor gives you more room to incline the seats, costing less per square meter to fly it around.

Why should the world's largest airline, United Airlines, care about fleet commonality? They have enough money to offset the lost money from it. Also, can't UA's current Airbus pilots be moved up to the A3XX if they were to order them? According to union rules, are Airbus pilots flying the A320 allowed to move up to larger Airbus aircraft or is that not allowed?

Boeing747-400, I hate to say, but isn't 30 years for the 747 a little too long? Shouldn't it finally give up its crown to another jetliner?

Boeing747-400, United will most probably order the A3XX, they have helped design it, and are EXTREMELY interested in it. Whether you believe it or not, they're ordering it. I even contacted United! Now don't you tell me you know more then them!

Tupolev154B2,

A current UAL Airbus captain would never move straight up to the A3XX. Everything goes by date of hire. Seniority is what determines what a/c each pilot may fly. I'm sure just about every current 777/744 captain
would jump at the chance to fly the XX, should it ever be an option for them.

regards,
WMT