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N14AZ
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 8:47 am

Quoting seahawk (Reply 199):
DXB is perfectly placed.

No US airline could make the EK model work, because North America does not allow for the EK system to work. No EU airline can make it work either, because their hubs are not so well placed. No Australian airline can do it, no Japanese, etc.

Yapp, someone once said that Turkmenistan would be the ideal location, since DXB is a little bit to far to the south... But nevertheless...

Quoting seahawk (Reply 199):
The success of EK with the A380 is killing the A380.

Hmm, I wouldn't go that far and use the word "kill" but I agree that a large number of EK A380s flying around today are A380s, which as per Airbus initial business scenario would fly in LH-cls., BA-cls. and more Asian operator's colours.

I think it's very unique in aviation history where one particular airline is able to make use out of one particular aircraft model and ordering it in dozends whereas all other major operators have only limited need for this particular aircraft...
 
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seahawk
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 9:12 am

Quoting N14AZ (Reply 200):
Hmm, I wouldn't go that far and use the word "kill" but I agree that a large number of EK A380s flying around today are A380s, which as per Airbus initial business scenario would fly in LH-cls., BA-cls. and more Asian operator's colours.

I think it's very unique in aviation history where one particular airline is able to make use out of one particular aircraft model and ordering it in dozends whereas all other major operators have only limited need for this particular aircraft...

I think EK is really killing the A380, because the competition from EK means that airlines can not really do what Airbus expected to happen. Which is sent one A380 instead of 2 smaller planes, because frequency and direct connections are the best answers to the EK challenge. That leaves the VLA for routes which have a very high O-D demand, that are not very dependent on high frequency and are having a high demand year round. Those are exactly the routes the EU airlines are using them on.
 
81819
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 9:59 am

Quoting JHwk (Reply 178):
In fairness, Airbus has a near-term problem with the 380, not necessarily a long term one. Just guessing, but I imagine they need to produce nearly 300 CEO models before the business case for a NEO will work. They need to figure out how to economically slow down the production rates and rationalize the production network.

Yes, I think that is correct. I too can see a strong business case for the A380 emerging in the 2020's. At some stage the market will catch up to it. The problem for Airbus is how to rationalise the manufacturing facilities to produce something like fifteen aircraft per month.

Quoting 2175301 (Reply 185):
What an interesting concept. You want the suppliers to maintain their production line, produce less parts, and lower cost. I've purchased $millions in parts and services via contracts and that is just not how it works. You get lower cost/part or service by ordering more not less. The supplier has to raise prices in your scenario in order to cover the cost of maintaining the production line with fewer parts.

I think there would have to be a trade off!

In some instances it might be best for Airbus to stockpile parts where in others it might be best to reduce the quantities ordered. At the end of the day, if the end game is to keep the production line open until such time a NEO comes along, the best option will be the one that produces the smallest losses.

I think it is fair to suggest, even if the A380 breaks even this year, it could be back in a loss position in the not to distant future!
 
parapente
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 11:13 am

Reply 199.
The success of EK with the A380 is killing the A380.

In a sense that is true.Clearly 200 A380's are going to suck up a load of traffic! But so are 150 777-9's too.

Now as discussed above a fair amount (no % known) will be new travelers (straight market growth) that are offered fantastic connections and a good price from cities that have never had such a service before (same as what has happened with short haul LCC's in US/Europe/Asia) .

But of course some of the traffic is being stolen from other airlines.We can already see airlines such a Qantas/SAA/Malaysia/Thai etc suffering.Even some of the secondary city traffic from Europe and America would have gone via major hubs but now(will) have no need to.

What is the market for A380's in one (10 year) sales cycle? It's anybodies guess ( For Airbus it is the key question I imagine).Perhaps 300 - no more.If that is true then they have to create an economic model producing 2.5 aircraft PCM over a 10 Yr period.If they can't then they might as well stop the project.If they can then all well and good.
The flip side is that if they can then 'the others' will have to trade down to smaller highly efficient aircraft such as the B787 and the A350/330. So they have the potential to win there as well.
 
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Matt6461
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 11:50 am

Quoting seahawk (Reply 199):
DXB is perfectly placed.

DXB's geography is overrated. The real heartland of o&d longhaul traffic across Eurasia is northeast Asia - Korea, Japan, the Bohai rim, and the Yangtzee delta. EK is not well placed for these markets and indeed is minor player in Northeast Asia. Its biggest O&D sources are South and Southeast Asia. Substantial markets but much smaller than Northeast Asia.

Spend some time on GCmap.Com comparing routings over DXB between the economic heartland of Europe and NEAsia. You'll see that the conventional wisdom about the gulf location is exaggerated. It's too far south.

Quoting seahawk (Reply 199):
The success of EK with the A380 is killing the A380.

Going back to the above... There are zero a380's based in Beijing, Shanghai, Tokyo, and Hong Kong. EK is a very minor presence on routes between those cities and Europe, so you can't blame EK there. Those cities and their ilk should be the bread and butter of A380 demand but none of the hometown hubbers have bought it. Gotta find a different villain. (Maybe it's the Red Baron's conspiracy idea)

Quoting seahawk (Reply 199):
They are not depending on low yiedling passengers to will their VLA, they can fill their VLA because their connections are competitive.

From the CAPA article I linked, you can see that EK has much lower unit costs than its competition. Yet EK does not have a significantly higher profit margin than BA. As profit margin is RASM minus CASM, and as profit margin isn't huge, it's likely that RASM is a little lower at EK than elsewhere. I haven't seen exact numbers for EK's RASM - can someone provide?

Quoting seahawk (Reply 199):
No US airline could make the EK model work, because North America does not allow for the EK system to work. No EU airline can make it work either, because their hubs are not so well placed. No Australian airline can do it, no Japanese, etc

Airlines don't need to be EK to use VLA'S successfully. EK runs a longhaul-longhaul connection model, but a more traditional shorthaul-longhaul hub model is still very competitive.

Below are links to distances from DUS to HKG and BKK, via either DXB or FRA. for HKG the gulf route 1,000 miles longer, for BKK 450 miles longer. So even for SEAsia it's almost a full hour longer flying time. And it gets worse the farther north you go.

http://www.gcmap.com/mapui?P=Dus-hkg,+dus-dxb-hkg,+dus-fra-hkg
http://www.gcmap.com/mapui?P=Dus-bkk,+dus-dxb-bkk,+dus-fra-bkk

A shorter connecting leg usually creates less distance distortion, which is more valuable to passengers and cheaper to the airlines.

We need to question conventional wisdom more here. The ME3 are not perfectly placed. Their advantages stem from cost structure, including EK's use of the most efficient planes.
 
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Matt6461
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 12:38 pm

Quoting parapente (Reply 203):
What is the market for A380's in one (10 year) sales cycle? It's anybodies guess ( For Airbus it is the key question I imagine).Perhaps 300 - no more

A quote like this really illustrates why my efficiency argument is likely right, and why most of you agree with it even if you don't know it. Consider two questions:

(1) how many A380ceos will Airbus sell in the future?
(2) how many A380neos will/would Airbus sell?

I'm going to assume that everyone's answer to (2) is greater than (1). If it isn't there's simply no reason to NEO.

But then ask yourself - why? The only or prime difference between a NEO and a CEO will be efficiency. Nobody here would even consider a NEO with equal unit costs to CEO - I hope.

Now work that insight backwards and forwards: what would a380's sales figures have been with 10% lower trip and unit costs? How much easier would Airbus' neo business case be if the NEO improved over CEO by 20% trip and unit cost rather than 5-7%? (Total DOC not just fuel)

And if you can see that the A380 would do better with lower unit cost, why do we think it's not doing great even though its unit costs are better than 77W's? A lot of folks say simplistically that you have to fill it. But what does that mean? It means it has higher trip cost, which is the same as saying it has higher capacity at a given unit cost: obviously if trip cost were lower than 77W you wouldn't need to fill the a380. Just block off the extra seats/space if selling them can't even pay your cabin crew costs.

Obviously we're not going to get a380 trip cost below 77W. But if you believe a NEO will sell better than a CEO, then you're agreeing with me that airlines will perceive a better tradeoff of a380neo's still-higher trip cost for even lower unit cost.

I'm other words, you're predicting A380 sales success based on a tradeoff of efficiency and capacity, just as I've been saying all along.

And if you're agreeing with me that far - you might not know it yet but you are - then why not question how far along that capacity/efficiency curve we can go? I.e. why stop at the neo?

Just another attempt to convince some of you that we agree on the fundamentals. No need to adopt any of my other pet views.

[Edited 2015-09-28 05:40:02]
 
kurtverbose
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 12:52 pm

Quoting Stitch (Reply 188):
And why did EK switch to RR for their next 50 when they have so many EA engines already? Serious speculation is because RR was willing to do a new engine option for the A380 where EA was not. And I don't think the sole reason for that was because RR has access to RLI and EA does not. EK is also a significant GE customer, yet they have agreed to order RR if they choose the 787 in their next RFP.

That's possible, and we'll probably never know for sure, certainly STR has denied it. RR has been investing in the Trent 900 and STR has been moaning that EA have promised but not delivered on any improvements. It could be that EK think the Trent is now the better engine. Re the 787/A350 decision, there is the matter of the original A350 order being cancelled.

Quoting Stitch (Reply 188):
Yes, but they didn't have to do so. They were already splitting the market and now that Boeing has launched the 737 MAX, Boeing is winning significant orders, as well, and the market is closing back on parity again.

Hmm, I think what ever way you look at it, numbers, margins, Airbus is winning the NEO/MAX war. Not by a huge margin though. They also forced Boeing to defer a NSA project.

Quoting Stitch (Reply 188):
Well RR was the clear winner on the A330 already and the best market for the frame is, IMO, the A330-300 which favors the Trent 700 already. So they arguably should have stood pat and just taken what A330 orders they could get rather than invest in a new engine for it.

Did you see the financial hit RR has taken on A330 sales? Anyway, the Trent 7000 isn't a new engine.
 
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speedbored
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 1:23 pm

Quoting Matt6461 (Reply 204):
You'll see that the conventional wisdom about the gulf location is exaggerated. It's too far south.

Only when you make the erroneous assumption that the majority of the traffic via DXB is to and from destinations to the north of DXB. EK provide flights to far more areas of the world than just Europe and NE Asia.

Quoting Matt6461 (Reply 204):
EK is a very minor presence on routes between those cities and Europe, so you can't blame EK there.

So, 1x773 & 1x380 daily to Beijing, 2x773 & 1x380 daily to Shanghai, 1x772 & 1x773 daily to Tokyo, and 1x773 & 2x380 daily to Hong Kong is "a very minor presence"? Yes, I know they are not all being filled entirely by Europe traffic but their presence is far from minor, especially on routes to secondary cities in Europe.

Quoting Matt6461 (Reply 204):
From the CAPA article I linked, you can see that EK has much lower unit costs than its competition.

No, we can see that EK has lower unit costs than IAG and Virgin. Not the same thing at all, given the very high cost base that both IAG and Virgin have to operate under, given their hub locations. Much of EK's competition has lower unit costs than EK in many areas.

Quoting Matt6461 (Reply 204):
As profit margin is RASM minus CASM

Not for your definition of CASM, it isn't.

Quoting Matt6461 (Reply 204):
Airlines don't need to be EK to use VLA'S successfully. EK runs a longhaul-longhaul connection model, but a more traditional shorthaul-longhaul hub model is still very competitive.

But shorthaul feeder networks will never be as profitable as longhaul ones due to the far lower catchment area. EK is doing so well because it provides far more 1-stop long-haul connection options, to/from locations that require 2 or more stops via other operators and, for cost conscious passengers, it also provides cheaper 1-stop options than direct flights with other operators on primary routes.

Quoting Matt6461 (Reply 204):
A shorter connecting leg usually creates less distance distortion, which is more valuable to passengers and cheaper to the airlines.

It is actually only more valuable to a small number of extremely time-sensitive passengers. Most passengers will be looking at price and/or comfort/service.

It is definitely not always (or even very often) cheaper to the airlines, either. There are considerable cost savings to be gained from doing two medium length legs instead of one very short and one very long leg. Far less fuel burnt just to carry fuel around.

Quoting Matt6461 (Reply 204):
We need to question conventional wisdom more here. The ME3 are not perfectly placed.

They may not be perfectly placed - as has already been mentioned up-thread, detailed analysis has suggested that the perfect location is somewhere in Turkmenistan - but they are most definitely better placed than most of the airlines they are competing against. Tim Clark, and a considerable number of competitor airline CEOs have publicly stated that location is one of the main competitive advantages that EK enjoys - I suspect that they have a far better understanding of this than the rest of us, even you.
 
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Stitch
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 1:43 pm

Quoting Matt6461 (Reply 189):
Given route fragmentation, broadly-used VLA's have to fly with lower-yielding pax mixes focused on transfer-willing time-insensitive pax.

  

If you look at A380 schedules, operators put the plane on the most-desirable / highest-demand times and when you look at A380 configurations, they have very large premium cabins.

The A380 is the "premium choice" for their premium passengers.



Quoting Matt6461 (Reply 204):
There are zero a380's based in Beijing, Shanghai, Tokyo, and Hong Kong. Those cities and their ilk should be the bread and butter of A380 demand but none of the hometown hubbers have bought it.

Long-haul international demand from Japan has dropped significantly and ANA and JAL have both shed their 747s in response.

The Chinese government controls what airlines operate what aircraft from what airports and so far they have only approved the sale of the five to "hometown hubber" China Southern (who have hubs in Beijing and Guangzhou, which is near Hong Kong).



Quoting kurtverbose (Reply 206):
Hmm, I think what ever way you look at it, numbers, margins, Airbus is winning the NEO/MAX war.

At the moment, yes they are. But over the next 10-15 years, I expect the numbers to even out as they did between the A320 and 737NG.



Quoting kurtverbose (Reply 206):
Did you see the financial hit RR has taken on A330 sales?

Yes, which I believe is in part to RR having very low Average Sales Prices for the engines in exchange for high markups on the TotalCare maintenance packages they sell with them. So the revenues (and profits) are deferred to future years.
 
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seahawk
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 1:55 pm

Quoting Matt6461 (Reply 204):
Going back to the above... There are zero a380's based in Beijing, Shanghai, Tokyo, and Hong Kong. EK is a very minor presence on routes between those cities and Europe, so you can't blame EK there. Those cities and their ilk should be the bread and butter of A380 demand but none of the hometown hubbers have bought it. Gotta find a different villain. (Maybe it's the Red Baron's conspiracy idea)

Maybe because they do not get the traffic rights?

http://centreforaviation.com/analysi...y-air-rights-were-available-136090

Quoting Matt6461 (Reply 204):

From the CAPA article I linked, you can see that EK has much lower unit costs than its competition. Yet EK does not have a significantly higher profit margin than BA. As profit margin is RASM minus CASM, and as profit margin isn't huge, it's likely that RASM is a little lower at EK than elsewhere. I haven't seen exact numbers for EK's RASM - can someone provide?

Logical, as EK is growing and trying to get traffic away from the competition.

Quoting Matt6461 (Reply 204):

Airlines don't need to be EK to use VLA'S successfully. EK runs a longhaul-longhaul connection model, but a more traditional shorthaul-longhaul hub model is still very competitive.

Below are links to distances from DUS to HKG and BKK, via either DXB or FRA. for HKG the gulf route 1,000 miles longer, for BKK 450 miles longer. So even for SEAsia it's almost a full hour longer flying time. And it gets worse the farther north you go.

Simple question, if you have to make one connection, what would you prefer?

As a premium class pax:

Two flights in EK widebodies or one flight in European configuration A320 and a LH widebody.

As economy pax, same question. And when would you prefer your connection to happen?

30 Minutes in, or at the halfway point, so you can stretch a bit, walk around a bit?
 
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Revelation
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 2:49 pm

Quoting parapente (Reply 203):
What is the market for A380's in one (10 year) sales cycle? It's anybodies guess ( For Airbus it is the key question I imagine).Perhaps 300 - no more.If that is true then they have to create an economic model producing 2.5 aircraft PCM over a 10 Yr period.If they can't then they might as well stop the project.If they can then all well and good.
The flip side is that if they can then 'the others' will have to trade down to smaller highly efficient aircraft such as the B787 and the A350/330. So they have the potential to win there as well.

300 per 10 years would be an interesting equilibrium point if it could be reached but it's not at all clear it could be. So far we have 171 deliveries 2007-2015 and already have airframes that are being offered on the market because their owner can't keep them profitably employed. A 10 year replacement cycle fleet-wide would be historically low so we'd need to see a big sales upswing to reach that point, and there's no evidence that it will be happening.

Quoting Matt6461 (Reply 204):
Spend some time on GCmap.Com comparing routings over DXB between the economic heartland of Europe and NEAsia. You'll see that the conventional wisdom about the gulf location is exaggerated. It's too far south.

Perhaps, but that doesn't mean its geography is overrated. When you factor in economic and political considerations it's not that likely that it can be undermined by a geographically more advantaged location. It's a large part of its advantages, IMHO.

I do agree that some here underrate its labor cost advantages. Pax are very motivated by price, and EK's low costs relative to the home carriers of the wealthier pax has been a huge factor in its growth.

Quoting Matt6461 (Reply 205):
then why not question how far along that capacity/efficiency curve we can go? I.e. why stop at the neo?

I think it's worthy of a paper exercise, but am dubious that when push comes to shove that there is the appetite for further investment in the A380 on the scale being suggested. I think some of the recent hurdles Airbus is raising, i.e. we won't do a NEO just for EK, belies a deeper resistance to increased spending on the A380.
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parapente
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 3:01 pm

Speedbored.
EK is doing so well because it provides far more 1-stop long-haul connection options, to/from locations that require 2 or more stops via other operators and, for cost conscious passengers, it also provides cheaper 1-stop options than direct flights with other operators on primary routes.

Got it in one. And it's the winning formula.It just so happens that the A380 is the perfect machine to conduct this unique strategy with.
But the thread is about 'To NEO or not'.(TXWB/BW/Mini stretch aka 850)
If it allows them to make a further 300 copies over the next decade profitably - yes they will.Even at B/E --

If they did not make it - then guess who those sales will go to?? (starts with a 7) So if you need any further proof that they will build it then look no further.Just a question of timing IMHO.
 
NAV30
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 3:08 pm

Quoting Revelation (Reply 210):
I think some of the recent hurdles Airbus is raising, i.e. we won't do a NEO just for EK, belies a deeper resistance to increased spending on the A380.

I think that's dead right, Revelation. The problem is not that A380s need new engines - it is that no airlines, with the sole exception of Emirates, are buying them in enough numbers to justify anything like continued full-scale production.

My personal view is that the twin-engined 400-plus-seat 'big twins' (B778/9X plus the likely Airbus counter-measure) will put the 'four-holers' out of business within a few years. One has only to look at the small number of orders for the A380 that Airbus has (almost entirely from Emirates) to realise how likely this is:-

https://en.wikipedia.org/wiki/List_of_Airbus_A380_orders_and_deliveries



[Edited 2015-09-28 08:25:54]
 
kurtverbose
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 4:20 pm

Quoting Stitch (Reply 208):
Yes, which I believe is in part to RR having very low Average Sales Prices for the engines in exchange for high markups on the TotalCare maintenance packages they sell with them. So the revenues (and profits) are deferred to future years.

Hmm, maybe, but that's not how RR reported it. They said it was heavy discounting by all three suppliers on an end of life frame.
 
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speedbored
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 4:35 pm

Quoting Matt6461 (Reply 205):
I'm going to assume that everyone's answer to (2) is greater than (1). If it isn't there's simply no reason to NEO.

Yes there is. Given that Airbus are currently only producing ceo frames at break-even, it could easily be worth going ahead with a neo even if it only sold exactly the same number of frames as a ceo would. Airbus would be able to charge a considerable price premium for a significantly more efficient frame.

Quoting Stitch (Reply 208):
The A380 is the "premium choice" for their premium passengers.

  

Quoting Stitch (Reply 208):
At the moment, yes they are. But over the next 10-15 years, I expect the numbers to even out as they did between the A320 and 737NG.

So do I. Maybe not to complete parity but it'll be close.

In this market, where the differences are marginal, when one option proves more popular than the other, the increasing backlog for the more popular aircraft will eventually start pushing orders onto the less popular frame. Yes, backlog can be managed, by altering production rates, but there will come a point at which the manufacturers will judge further increases in rate as being just too risky.

Quoting Revelation (Reply 210):
but am dubious that when push comes to shove that there is the appetite for further investment in the A380 on the scale being suggested.

So am I. I can see Airbus being able to make a case for spending a billion or two on a straightforward neo, and some low-hanging aero and weight improvements. I can't ever see them making a case for the likely 5+ billion cost of doing a whole new wing. There are limits to how many frames Airbus will be able to sell, almost regardless of how efficient they can make it.
 
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Matt6461
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 6:54 pm

Quoting Stitch (Reply 208):
If you look at A380 schedules, operators put the plane on the most-desirable / highest-demand times and when you look at A380 configurations, they have very large premium cabins.

One of the virtues of seat-standardized comparisons, or at least of comparisons by floor area, is that it better isolates airplane-specific *effects* from correlations. When we look at nominal seating characteristics, it's very hard to disentangle cause and correlation. If you're saying the A380 causes higher premium seating, I'd say you're finding causation from correlation without justification here. Maybe you're not...

Plus if we consider revenue/yield per floor area, rather than per nominal seat, the RAMM of the existing A380 fleet would decline. Nearly every operator configures them less densely than the rest of the fleet. ...which seems like a product of the A380's efficiency.

Quoting Stitch (Reply 208):
The Chinese government controls what airlines operate what aircraft from what airports and so far they have only approved the sale of the five to "hometown hubber" China Southern

Sure, though I've also read that CAAC's "approval" of orders is more of "face-saving" measure to allow bureaucrats to claim activity in an environment that still values government activism. I.e. the airlines do what they want, but for a few mega-issues like the EU's carbon tax proposal. In any event, I don't see why CAAC would have any more or less problem with airlines buying A380's versus other A or B products.

Quoting Stitch (Reply 208):
But over the next 10-15 years, I expect the numbers to even out as they did between the A320 and 737NG.

...different topic but I'm betting that Boeing will keep the runner up trophy here. Especially given the narrowbody upgauging trend, as A321 is dominating the MAX-9 and that's not going to change.

Quoting seahawk (Reply 209):
Simple question, if you have to make one connection, what would you prefer?

I love simple questions. And you've used the device well to isolate a valid analytical point that I missed here: I bet most people would prefer the midway break. Seahawk+1

But still... On the revenue side, how much total time will passengers trade for a more convenient break? The tradeoff seems reasonable for SE/South Asian routes where DXB isn't far out of the way. For NE Asia flights, I still don't see this working. On the cost side, the airline flying 10% further still has to bear that expense.

Quoting Revelation (Reply 210):
am dubious that when push comes to shove that there is the appetite for further investment in the A380 on the scale being suggested. I think some of the recent hurdles Airbus is raising, i.e. we won't do a NEO just for EK, belies a deeper resistance to increased spending on the A380.

Agreed re Airbus psychology. I bet some of the most "anti-A380" people in the world work in Toulouse. Hard to get bit that hard and not be shy. All kinds of cognitive biases and emotional/motivated thinking interfere with sober A380 strategy. Maybe even more in Toulouse than on a.net.

Quoting Revelation (Reply 210):
Perhaps, but that doesn't mean its geography is overrated.

Well somebody said their patch of earth is "perfect," which is certainly overrating. The only perfect place on earth is somewhere in northern Wisconsin. But that's my secret.
 
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Revelation
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 7:02 pm

Quoting Matt6461 (Reply 215):
Well somebody said their patch of earth is "perfect," which is certainly overrating.

Ok, missed that. EK's geographical position in many cases adds distance/time/cost/inconvenience but it's being made up for by low labor costs, relative political stability, efficiencies of large widebodies, and network effects. I agree it's far from perfect for NE Asian flows especially ex Europe.

Quoting Matt6461 (Reply 215):
The only perfect place on earth is somewhere in northern Wisconsin. But that's my secret.

:D
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Stitch
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 7:08 pm

Quoting Matt6461 (Reply 215):
One of the virtues of seat-standardized comparisons, or at least of comparisons by floor area, is that it better isolates airplane-specific *effects* from correlations. When we look at nominal seating characteristics, it's very hard to disentangle cause and correlation. If you're saying the A380 causes higher premium seating, I'd say you're finding causation from correlation without justification here.

I would not say it causes higher premium seating, since we have seen high-premium configurations on smaller planes (ANA's and JAL's 777 and 787 fleets and BA's 747-400s, for example).

What I would say is that A380 operator's modeling of their routes and passengers have shown that the "A380 effect" is one that encourages their premium cabin passengers to book those flights so they have taken advantage of the extra space to allocate additional seats to capture that traffic and revenue.



Quoting Matt6461 (Reply 215):
For NE Asia flights, I still don't see this working. On the cost side, the airline flying 10% further still has to bear that expense.

Evidently it does work, since EK does offer LHR-DXB-NRT flights and I know people who take them over the non-stop even with the long layover times at DXB. The NRT-DXB-NRT leg is operated "only" with the 777-300ER, so I will spot you it's not the most-popular routing, but it must not be very unpopular, otherwise it would only be filled with low-fare passengers and that would require an A380.  

[Edited 2015-09-28 12:25:43]
 
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 7:12 pm

Quoting Matt6461 (Reply 215):

Well somebody said their patch of earth is "perfect," which is certainly overrating. The only perfect place on earth is somewhere in northern Wisconsin. But that's my secret.

Sure, somewhere in Turkmenistan or Uzbekistan would be even more perfect, yet the ME3 model would not work without their hubs, being where they are.

Quoting Matt6461 (Reply 215):
I love simple questions. And you've used the device well to isolate a valid analytical point that I missed here: I bet most people would prefer the midway break. Seahawk+1

But still... On the revenue side, how much total time will passengers trade for a more convenient break? The tradeoff seems reasonable for SE/South Asian routes where DXB isn't far out of the way. For NE Asia flights, I still don't see this working. On the cost side, the airline flying 10% further still has to bear that expense.

But that is looking at O-D traffic. The next factors to come in are the fact that they can use bigger planes on each leg, their general cost advantage and their willingness to reduce profit for market share. Or as some would say their willingness to give up profit until the competition has given up.

But the question is not why EK is successful, the question is why nobody except EK wants many A380 and for that the answer is EK imho, as they make it impossible to route more passenger through the big hubs in Europe or Asia, as this would mean 2-stopp connection for routes EK could offer a one stop.
 
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 7:25 pm

Quoting Revelation (Reply 216):
EK's geographical position in many cases adds distance/time/cost/inconvenience but it's being made up for by low labor costs, relative political stability, efficiencies of large widebodies, and network effects.

I just downloaded a new CAPA report on global airline's unit cost efficiency. It's free, but requires registration: http://centreforaviation.com/reports/43

The report really drives home the salience of EK's cost structure edge. Contrary to some suggestions here, the airline against which CAPA previously compared EK - BA - is pretty average for Europe. LH has higher unit costs. And the report emphasizes that Asian full service carriers (FSCs) actually have the worst unit costs (some of which results from their more premium branding, surely).

Quote:
The challenge for the Asia Pacific FSCs based in
the higher cost economies of the region is clear:
they must further reduce their costs. They are
among the world’s least cost efficient airlines, as
defined by the level of CASK for a given average
trip length.

So the ME3 sit between two broad regions - Europe and Asia - whose airlines have high unit costs resulting from high-wage domestic economies and likely from labor market/structural reasons as well. They are - with TK - the only market entrants who directly compete against the high-cost carriers from lower-wage labor markets with anything approaching intermediary geography. The ME3 don't need "perfect" geography to exploit this compelling competitive advantage. Their geography is "good enough," but we have to recognize that cost may be the real primary driver here.

And yes, that includes their fleet strategies, especially for EK's use of much bigger, more efficient planes than its competitors (goes for both A380 at Dusseldorf and 77W at Newcastle - both of which seem incongruous in a non-EK world).

And yes, they also needed the vision and daring to recognize a business opportunity and execute the novel business model that exploited it.
 
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 7:32 pm

Quoting seahawk (Reply 218):
Sure, somewhere in Turkmenistan or Uzbekistan would be even more perfect, yet the ME3 model would not work without their hubs, being where they are.

Still far from perfect: http://www.gcmap.com/mapui?P=LHR-DXB-NRT,+LHR-ASB-NRT,+LHR-NRT

Quoting seahawk (Reply 218):
But that is looking at O-D traffic. The next factors to come in are the fact that they can use bigger planes on each leg, their general cost advantage and their willingness to reduce profit for market share. Or as some would say their willingness to give up profit until the competition has given up.

But the question is not why EK is successful, the question is why nobody except EK wants many A380 and for that the answer is EK imho, as they make it impossible to route more passenger through the big hubs in Europe or Asia, as this would mean 2-stopp connection for routes EK could offer a one stop.

The implication is as time moves on EK soaks up so much traffic that it impacts non-A380 sales too.
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 7:42 pm

Quoting 2175301 (Reply 185):

Quoting JHwk (Reply 178):
Case 2: ramp down to 15/year over next 12 months, spread production over 6 years, and renegotiate supply contracts at the lower rates.

What an interesting concept. You want the suppliers to maintain their production line, produce less parts, and lower cost. I've purchased $millions in parts and services via contracts and that is just not how it works. You get lower cost/part or service by ordering more not less. The supplier has to raise prices in your scenario in order to cover the cost of maintaining the production line with fewer parts.

Just for the record, I didn't say lower cost. Of course costs would be higher for almost everything, except where they manage to bankrupt one supplier and switch to another with a lower capital investment given the lower production rate. Some times though ripping the band-aid off provides clarity to the supply chain.

Quoting speedbored (Reply 214):

Therein lies the rub, you can't charge as much of a premium if the trip fuel cost reduction doesn't warrant it. With $50 oil, the benefits of the more efficient plane are overshadowed by capital cost.
 
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RE: Bregier: No A380NEO Decision Before End Of The Year

Mon Sep 28, 2015 7:57 pm

Quoting Stitch (Reply 217):
The NRT-DXB-NRT leg is operated "only" with the 777-300ER, so I will spot you it's not the most-popular routing, but it must not be very unpopular, otherwise it would only be filled with low-fare passengers and that would require an A380.

Yep and when an A319neo starts flying this route we'll know EK's made it.

Lol, touche.

Quoting Stitch (Reply 217):
What I would say is that A380 operator's modeling of their routes and passengers have shown that the "A380 effect" is one that encourages their premium cabin passengers to book those flights so they have taken advantage of the extra space to allocate additional seats to capture that traffic and revenue.

Sure. And I'd just argue that operator's who purchased that extra space in A380's, rather than in ~60% more 77W's or whatever, mostly did so because of the A380's efficiency, not necessarily because there is something intrinsic about A380's cabin that makes it better, per floor area, at carrying F/J seats.*

*although, with the recent removal of the UD side-storage bins, and the increasing trend to 1-2-1 J, I do think the A380 UD is more efficient than 777 per floor area for herringbone J. That trend and configuration option is a more recent thing and doesn't have a huge impact on the current order book. It's a great fact about the A380, however, that Airbus can hopefully leverage with a future version.

Quoting seahawk (Reply 218):
the question is why nobody except EK wants many A380 and for that the answer is EK imho, as they make it impossible to route more passenger through the big hubs in Europe or Asia, as this would mean 2-stopp connection for routes EK could offer a one stop.

1-stop connectivity surely explains a lot of EK's success, and in a way that some of your points have helped me better understand.

But it still can't explain the failure of A380 dominate Europe-NEAsia. It doesn't explain the A380's failure to dominate thick TPAC and TATL routes like NYC-LON, HKG-NYC, PEK-SFO. The A380 has underperformed projections in a lot of places where EK is minor or simply irrelevant.

1-stop connectivity also doesn't explain EK's ability to fly 6 (7?) A380's daily to London. There aren't many places to fly from DXB that aren't directly served from LHR. Australia isn't THAT big of a market. EK's success in the London market has to be explained by price and/or quality of service. And the ability to offer that better service stems from economies of scale that allow for better food, space, lounges etc.
 
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 4:59 am

China controls the traffic rights very closely.

And for North America it depends on the route. LON-NYC is very special in the way that for many customers the average time spent at the destination if often more typical of a short or medium haul route than of a long haul.

If you look at Europe LAX, the A380 is big on that route.

For most airlines it seems like the A380 only works on routes with a high O-D demand, longer flight times and longer average trip durations. There are not many of those.
 
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 5:31 am

Quoting Matt6461 (Reply 215):
bet some of the most "anti-A380" people in the world work in Toulouse. Hard to get bit that hard and not be shy. All kinds of cognitive biases and emotional/motivated thinking interfere with sober A380 strategy.

I think it is also worth mentioning that the different managers now in place in Toulouse were not responsible for starting the A380-programme. In that interview with the financial manager (forgot his name and correct position), during which he said "then we will simply stop production", you could clearly hear this attitude, IMHO.
 
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 9:04 am

Quoting tortugamon (Reply 25):
Is the A330neo in 'firm configuration' yet? I am sure some of the design team is working on what an A380neo would look like.

I do not remember a press release on design freeze as with the BelugaXL, but given that the A330NEO is somewhat ahead of that program, it should be in detailed design now.

Quoting parapente (Reply 27):

I was personally more than a little surprised (but pleased) that he switched to RR for his last batch of Mk1 380's.It just doesn't ring true somehow though (commonality again).Just feel it may be part of something bigger.

IMO it was definitely part of something bigger, it was a major strategic move by EK-RR with the implicit nod by Airbus to pave the way for the NEO. RR would only do NEO if the engine is single source, just like A330NEO. Therefore, the manufacturer not willing to do a new engine (EA) had to be removed from the equation. EK was only too willing to help with that. And Airbus is spared uncomfortable renegotiations with EA.
 
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 9:56 am

Quoting r2rho (Reply 225):
Therefore, the manufacturer not willing to do a new engine (EA) had to be removed from the equation.

There are lots of ways to read these tea leaves; you'll end up believing whatever you want.

EA is still in the running for a revised A380. http://aviationweek.com/paris-air-sh...s-a380neo-gp-upgrade-business-case

IMO if Airbus doesn't want to invest enough in the A380 to keep up with (and beat) the competition, a PIP, stretch, and winglets will be what happens. Based on RR's recent statements - after the new CEO came on - they aren't any more enthusiastic about the NEO than EA. Airbus could even do the PIP/Stretch/Winglets for EK only, thus insulating themselves from BOD backlash over past promises not to NEO for a single customer.

Hopefully they'd do this as life support for a later, more serious investment in a modern wing optimized for the fuselage it carries. But by the time they get there, technology may have moved far past the A380 - new wing or not.
 
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 10:52 am

Quoting Matt6461 (Reply 226):
But by the time they get there, technology may have moved far past the A380 - new wing or not.

I think that's the question to which none of us has an answer. And 'none of us' very probably includes Airbus! But there appear to be plenty of signs, on recent evidence, that four engines are just about 'out-of-date'? Boeing have effectively 'dropped' the B748, and Airbuve has relatively few orders for the A380 (apart from Emirates).

Boeing appear to have made their intentions clear - phase out the B748 and develop over-400-seat 'big twins.' Airbus could very well succeed in countering that, at least partially, by developing an A350-1000, and even an A350-1100 - the A350 already shows clearly that it performs well and is highly competitive in its class.

The alternative might well be be a complete new 400-seat twin-engine design, some sort of 'A360.' There is still time for Airbus to remain competitive if it acts now?

[Edited 2015-09-29 03:57:26]
 
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 11:00 am

I think that is the big problem for Airbus.

If they use the money to do a big A380 upgrade, nobody can be certain that it will sell.

If they use the money for a A322, A350-1100 and maybe for research into a A320 replacement, they can be certain those planes will sell.
 
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 12:09 pm

Mat6461
IMO if Airbus doesn't want to invest enough in the A380 to keep up with (and beat) the competition, a PIP, stretch, and winglets will be what happens.

'Beating the competition' is so often just playing with numbers by both A&B.They both do it all the time.For instance how many pax in the plane changes the numbers dynamic enormously.So A could say 11 across in Y for instance.Numbers look very good but nobody will do it (probably).
Having said that if they do,do a half stretch (850) the additional pax numbers will go a long way to 'beating the competition'

I am personally still of the opinion that a variant of the TXWB will be hung on it (rather than a PIP) for a 2021 EIS to give them potential commonality with any A350's they may want.But could well be wrong.I don't imagine this would be a very expensive exercise as long as weights are similar.
 
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 12:20 pm

Quoting Matt6461 (Reply 226):
IMO if Airbus doesn't want to invest enough in the A380 to keep up with (and beat) the competition, a PIP, stretch, and winglets will be what happens.

And in that case, EA would be back in the running, I agree. This low cost proposition could be a half-stretch IMO, not a full one. I don't believe in this half-hearted improvement, but it would be cheaper, and EK would still buy it, but nobody else.
 
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 1:01 pm

Quoting r2rho (Reply 230):
And in that case, EA would be back in the running, I agree. This low cost proposition could be a half-stretch IMO, not a full one. I don't believe in this half-hearted improvement, but it would be cheaper, and EK would still buy it, but nobody else.

A half stretch would go a long way in increasing the aircraft's cargo carrying capacity. It would also make better use of the wing, which was designed for the 900 model. Both EA and RR are ready to hit the GO button on PIP's or upgrades to their current engine offerings. If we throw into the mix eleven abreast seating we could well have a winner.

For instance a larger A380-850+ may be just as economical (on a seat basis) as an A380-800NEO, but with the added advantage of having higher passenger carrying capability.

For airlines like EK this model could fit quite nicely into their future growth plans. It would also be a great help for Dubai airport which is quickly running out of capacity.
 
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 1:09 pm

Quoting NAV30 (Reply 227):
I think that's the question to which none of us has an answer. And 'none of us' very probably includes Airbus! But there appear to be plenty of signs, on recent evidence, that four engines are just about 'out-of-date'? Boeing have effectively 'dropped' the B748, and Airbuve has relatively few orders for the A380 (apart from Emirates).

Boeing appear to have made their intentions clear - phase out the B748 and develop over-400-seat 'big twins.' Airbus could very well succeed in countering that, at least partially, by developing an A350-1000, and even an A350-1100 - the A350 already shows clearly that it performs well and is highly competitive in its class.

The alternative might well be be a complete new 400-seat twin-engine design, some sort of 'A360.' There is still time for Airbus to remain competitive if it acts now?

I think this is the question to which none of us has an answer. And 'none of us' very probably includes Boeing! But there appear to be plenty of signs, on recent evidence, that two engines are just about 'out-of-date'? Boeing have effectively 'dropped' the B747-400 long ago and are producing the 747-8, and AIRBUS (learn to spell! Even ESL can do that!) has a lot more orders than the 777X because the 777X has no orders!! How do you explain this?

Boeing appear to have made their intentions clear - keep the B748 and develop a 380-seat 777X that will be available in 2021. Airbus could very well succeed in countering that, entirely, by developing an A380neo and A380-900, and the A350 already shows clearly that it performs well and is highly competitive in its class. So Airbus has the unbeatable products.

The alternative might well be be a complete new regional twin-engine design, some sort of 'A360.' There is still time for Airbus and Boeing to remain competitive if it acts now?

Don't you love it when you make his/her writing the opposite??? Doesn't make sense anyway!

Quoting Matt6461 (Reply 226):
IMO if Airbus doesn't want to invest enough in the A380 to keep up with (and beat) the competition, a PIP, stretch, and winglets will be what happens. Based on RR's recent statements - after the new CEO came on - they aren't any more enthusiastic about the NEO than EA. Airbus could even do the PIP/Stretch/Winglets for EK only, thus insulating themselves from BOD backlash over past promises not to NEO for a single customer.

They wouldn't want to invest in something even for a handful of customers because it will still be majority Emirates. There is no replacement for an A380 so they can afford to sit back and let the PIPs do the work. I doubt winglets will come in because of the existing wing. A folding wingtip would be ideal when the NEO comes by, or indeed A380-900.
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 1:30 pm

Quoting PhoenixVIP (Reply 232):
and AIRBUS (learn to spell! Even ESL can do that!) has a lot more orders than the 777X because the 777X has no orders!! How do you explain this?

Sorry, just don't understand your (apparently very confused) post, PhoenixVIP? The 777X already has 306 firm orders and the smaller (350-seat) version is planned to enter production in 2018?

https://en.wikipedia.org/wiki/Boeing_777X#Orders

[Edited 2015-09-29 06:39:33]
 
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 1:33 pm

Quoting NAV30 (Reply 233):

No wait, Quote: "I don't think anyone can call orders for an aeroplane that hasn't flown yet truly firm". Therefore the 777X has zero orders. And plan to enter service is 2020. I understand plain English and Chinese thanks!   

Therefore the A380neo hasn't got orders yet (of course!). And thus Airbus has plenty of time to see whether or not a new wing should be done (what a beast will the plane be if Matt6461's ideas really came onboard for the NEO)!

[Edited 2015-09-29 06:34:09]
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 2:01 pm

Quoting parapente (Reply 229):
I am personally still of the opinion that a variant of the TXWB will be hung on it (rather than a PIP) for a 2021 EIS to give them potential commonality with any A350's they may want.But could well be wrong.I don't imagine this would be a very expensive exercise as long as weights are similar.

Dry weight is about 800kg more for the XWB, my bet would be on the Trent 1000 based 7000.
 
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 2:07 pm

"I don't think anyone can call orders for an aeroplane that hasn't flown yet truly firm"

Are you sure about that?
 
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 2:45 pm

This remais a funny question.
Lets be totally honest here. AB will upgrade the A380 because of ego. The A380 really never panned out to what AB saidmit would. If they knew 20 years ago what they knew now this plane would have never been built in the first place. The money could have produced a far better ROI on a competitor to the B777 rather than a dying B747? That said the real question is, is AB smart enough to invest where stong sales will come in for decades or in a bird that gathers interest only from a single airline.

At what point do you move on to generate the greatest ROI versus trying to expect to sell thousands of planes fictitiously.

Every college and university business school teaches risk diversification. With One sole buyer the risk isnt worth the reward.

The reason AB will do a NEO is because ego will outweigh both sense and economics, its all about having the biggest in production. Said another way; profits from the A330, A350, A320, B787, B777, B737 all financially dwarf the A380 to the size of a 50 seat jet comparitively speaking.

From my perspective the aviation world needs a true B757 replacement a thousand fold more than a NEO for one airline.
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 4:33 pm

Quoting NAV30 (Reply 233):
Sorry, just don't understand your (apparently very confused) post, PhoenixVIP? The 777X already has 306 firm orders and the smaller (350-seat) version is planned to enter production in 2018?

There are only 2 versions of the 777X. There is the 350 seat three class version, the 779 and there is the 300 seat three class version, the 778. The 779 is scheduled to enter into service first in 2020 and the 778 around 2023. There is the 779 that may reach 400 seats if you cram the seats in with three classes like EK with 7-abreast J and 10-abreast Y. Or are you under the impression that there will be even a further stretch of the already triple stretched 777?
 
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 5:19 pm

Quoting N14AZ (Reply 224):
I think it is also worth mentioning that the different managers now in place in Toulouse were not responsible for starting the A380-programme.

That's a very good point. I've seen examples in my corporate life of new managers using projects started by previous managers as scapegoats.

Quoting N14AZ (Reply 224):
In that interview with the financial manager (forgot his name and correct position), during which he said "then we will simply stop production", you could clearly hear this attitude, IMHO.

It was quite the controversial statement:

Quote:
While Airbus will break even on the plane in 2015, 2016 and 2017, that outlook doesn’t hold for 2018, forcing the company to either offer new engines to make the A380 more attractive or discontinue the program, Chief Financial Officer Harald Wilhelm told investors at a meeting in London today.

Ref: http://www.bloomberg.com/news/articl...-jumbo-faces-spendorfade-conundrum

Quoting parapente (Reply 229):
'Beating the competition' is so often just playing with numbers by both A&B.They both do it all the time.For instance how many pax in the plane changes the numbers dynamic enormously.

It's pretty clear that the professionals don't use the brochure numbers. That doesn't mean broad metrics such as CASM/RASM are worthless, IMHO.

Quoting Matt6461 (Reply 226):
EA is still in the running for a revised A380

Pure corporate posturing, IMHO.

Quoting PhoenixVIP (Reply 232):
Boeing appear to have made their intentions clear - keep the B748 and develop a 380-seat 777X that will be available in 2021. Airbus could very well succeed in countering that, entirely, by developing an A380neo and A380-900

Boeing would be glad to see Airbus pour more money down the speculative rat hole that is the A380neo and A380-900, IMHO. The program has yet to make a dime for Airbus and even once it breaks even on production it's clear that it will be challenged going forward. Spending more makes the situation worse rather than better. The safest thing to do is to keep the program alive hoping market interest develops before the cost of keeping the production line active is too high. That's why we keep hearing Airbus execs talk about "a densified version of the current A380". If that sounds familiar, it's because it is in the thread starter above!

Quoting PhoenixVIP (Reply 232):
the A350 already shows clearly that it performs well and is highly competitive in its class

Agreed, it's the wide body bread and butter moving forward.

Quoting PhoenixVIP (Reply 232):
So Airbus has the unbeatable products.

They have competitive widebodies but I would not say they are unbeatable.

Quoting PhoenixVIP (Reply 232):
There is no replacement for an A380 so they can afford to sit back and let the PIPs do the work.

PIPs usually are good for 1%-2% so it won't be much work.

Quoting billreid (Reply 237):
Lets be totally honest here. AB will upgrade the A380 because of ego.

I don't see the same kind of ego present in Enders et al as we saw with Foregard et al. However there is something to be said for having a "halo project". The real question is whether or not A380 is still such a halo project. It seems it is doing nothing great for the brand image due to all the ongoing negative news about its financials.

Quoting billreid (Reply 237):
If they knew 20 years ago what they knew now this plane would have never been built in the first place. The money could have produced a far better ROI on a competitor to the B777 rather than a dying B747?

That's a big question. Clearly a product line with nothing bigger than A340 was not satisfactory. Clearly Airbus took a very optimistic view of what the VLA market could become and caused AIrbus to saddle the A380-800 with the structure needed for A380-900. At the time A380 was launched there was 777A but not 777W. The 777W showed its capabilities long after Airbus committed to the A380. So there's some poor market forecasting mixed in with some bad timing, IMHO.

Quoting billreid (Reply 237):
The reason AB will do a NEO is because ego will outweigh both sense and economics, its all about having the biggest in production.

The alternative would be to destroy the investment already made in A380. The safe move is to get the program to break even and stretch its lifetime out to cover the case that its market prospects may improve.

Quoting billreid (Reply 237):
From my perspective the aviation world needs a true B757 replacement a thousand fold more than a NEO for one airline.

Boeing seems to be having as much problems making the MOM business case close as does Airbus have with making the A380neo business case close.
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 5:29 pm

Quoting billreid (Reply 237):
AB will upgrade the A380 because of ego.

If that was the case, why haven't they already done it?      
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Stitch
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 5:35 pm

Quoting billreid (Reply 237):
Lets be totally honest here. AB will upgrade the A380 because of ego.

I don't believe Airbus launched the A380 due to ego and the management team that launched the A380 is for the most part no longer with Airbus.



Quoting billreid (Reply 237):
The reason AB will do a NEO is because ego will outweigh both sense and economics, its all about having the biggest in production.

Airbus had a gap at the top end of the market and that market looked like it would still have decent growth.

The A340-600 handily beat the 747-400 on economics to the point that the 747-400 only could stay ahead when full (thanks to the better yields from having more seats). The A380-800 negated that due to being larger and being able to break-even at similar load factor percentages (so it offered better yield opportunity).
 
Amiga500
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 6:00 pm

What we know:

1. The A380's engines are (relatively) a bit inefficient compared to the 777X and A350.
2. The A380's wing is not designed for the -800 fuselage and is in a fairly unoptimised state.
3. The aspect ratio of the wing is also less than ideal, but avoids the complexity of moving wingtips.
4. The dozen or so potential A380 customers (that aren't Emirates) are finding that the load factors required to ensure good profit are a little too aggressive for most of their routes, meaning flexibility is verging on unacceptably low. This is a result of the entire aircraft, not one particular aspect.

What are the options:

A) PIPs on the engine. Most straightforward and cheapest of all options and gives most modest returns. Won't bring about a change in economics relative to the competition.
B) Re-engine. Relatively straightforward and relatively cheap option. However, with 777X EIS in roughly the same timeframe as any expected A380neo, again, a re-engine alone won't result in any significant changes in economics relative to the competition.
C) Re-wing. Very complex, it is likely that any wing would now include CFRP spars and covers on the torque box. Moveable tips would be an option to further improve lift-dependent drag. Would making the (L/D)pax efficiency of the A380 better than any other plane in the sky. However, it would come at a massive cost.
D) Stretch the fuselage. A cheaper alternative to matching up the wing to the engine; but the problem is then that airlines will be wary of load factors not rising commensurately and thus they lose out more.
E) A combination of the above. If money wasn't an issue, a re-engined, re-winged and probably somewhat stretched aircraft would be the result (A380-850), but in the real world that isn't an option at all!
 
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Matt6461
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 7:35 pm

Quoting travelhound (Reply 231):
A half stretch would go a long way in increasing the aircraft's cargo carrying capacity.

Not really. The half stretch adds 4 LD3 slots. The bags of 50 additional pax take up ~2LD3. So you've gained 2 LD3's.

Quoting travelhound (Reply 231):
It would also make better use of the wing, which was designed for the 900 model.
Quoting Amiga500 (Reply 242):
D) Stretch the fuselage. A cheaper alternative to matching up the wing to the engine; but the problem is then that airlines will be wary of load factors not rising commensurately and thus they lose out more.

This is true but the wing wouldn't be optimal for the -900 either. A 2005 -900 required a massive wing to get off the ground but with modern engine tech MTOW would be lighter, the wing should be smaller.

Once you're off the ground, the wing is too short. It's too short for the -800, far too short for the -900. Thus extremely high induced drag plus the added parasitic drag from being too big. Plus the added drag/weight required to lift/carry the added fuel due to the added drag. Plus the added drag/weight required to lift the added weight/drag required to lift/carry the added fuel due to the added drag.

Get the point? A critical design constraint like the 80m box reverberates everywhere in the airframe. Thus we have a double-decker - which should have the best aerodynamics by a large margin - having slightly worse aerodynamics than big twins.

Quoting PhoenixVIP (Reply 232):
A folding wingtip would be ideal

...well not quite ideal. But yes, would be impactful. I wonder if Airbus could/would add raked folding wingtips to a more comprehensive NEO short of a rewing.

Quoting Amiga500 (Reply 242):
Moveable tips would be an option to further improve lift-dependent drag.

...and in the context of a new wing, zero-lift drag would be much better too because the current wing is probably the biggest wing we'll see in our lifetimes (area-wise). And don't forget about the empennage, which currently has 90% of the wetted area of one wing.
 
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Stitch
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 7:39 pm

Quoting Matt6461 (Reply 243):
A 2005 -900 required a massive wing to get off the ground but with modern engine tech MTOW would be lighter, the wing should be smaller.

Or you could keep the wing and MTOW and get an improved payload-range curve.  
 
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speedbored
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 7:40 pm

Quoting Revelation (Reply 239):
Spending more makes the situation worse rather than better.

Not necessarily. Historically, almost every re-engined variant has sold at a price premium over its predecessor. I see no reason why that should not also be the case with an A380neo. If Airbus go ahead with only a simple neo then I doubt that production costs would increase much, if at all, so any price premium would be almost entirely profit on a unit production basis.

If that additional profit multiplied by projected future orders is more than sufficient to recover the neo development costs then they have a business case, and the situation has been made better rather than worse.
 
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Matt6461
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 7:44 pm

Quoting Amiga500 (Reply 242):


Sorry I read through your post too quickly and lumped you in with someone else saying the wing would be fine for the -900. Your post was better than that. Good summary of the issues.
 
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 7:45 pm

Quoting Matt6461 (Reply 243):
This is true but the wing wouldn't be optimal for the -900 either. A 2005 -900 required a massive wing to get off the ground but with modern engine tech MTOW would be lighter, the wing should be smaller.

Do you think additional thrust to compensate for less lift from a wing comes for free?
 
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 7:45 pm

Airbus needs a plane larger than the 350, the 380 will likely continue to be it for the next 15 years. And it will likely get the incremental improvements and possibly a minor stretch to keep EK happy. The alternative is launching a 'larger than 779' two engine. This will eventually happen, anyone care to guess when?
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Matt6461
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RE: Bregier: No A380NEO Decision Before End Of The Year

Tue Sep 29, 2015 7:47 pm

Quoting Stitch (Reply 244):
Or you could keep the wing and MTOW and get an improved payload-range curve.

True but the A380 doesn't have space to carry a lot more payload, and its range is already at a point where more range/payload hasn't sold well so far. Some think the 777-8 will break this trend, but I doubt it.
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