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Stitch
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 2:51 pm

Quoting HALtheAI (Reply 40):
It doesn't matter if EK orders 200 or 500, the delivery schedule is the key. Airbus will want EK to take at least 20/year if there are little or no other customers, but that's highly problematic early on.

I agree that this is where I see the crux of the matter.

Airbus and Rolls will be able to use RLI to cover a third of the development costs and while Rolls might have some issues with credit / cashflow, Airbus certainly does not. So I don't see this as Airbus needing Emirates to actually front a billion or two Euros to fund the development.

Airbus will not want the production rate to fluctuate so I can see them wanting Emirates to agree to a pre-determined delivery schedule (with penalties for not taking frames on said schedule).
 
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Boeing778X
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 4:16 pm

I'm sure there is a catch.

Quoting PhoenixVIP (Reply 42):
The 777X has zero orders right now and is in more trouble than the A380 or A380neo. So the ME3 plus QF, BA and their likes will top up with more albeit with the bulk from EK.

"777X has no orders and is in more trouble than the A380."

LLLOOOLLL! What?!



You do know there's like 306 orders currently for the 777X, RIGHT?
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David_itl
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 4:19 pm

Quoting Jacobin777 (Reply 52):
There are 306 firm orders and a bunch of potential LOI's/MOI's.
Quoting Boeing778X (Reply 53):
You do know there's like 306 orders currently for the 777X, RIGHT?

Not per NAV30's way of thinking. Not flown therefore no orders. Or as PhoenixVIP put :

Quoting PhoenixVIP (Reply 47):
Quoting Flaps (Reply 44):

Sorry I understand what you mean entirely, but check my signature. That's the comment from our most renowned A380 is dead poster on here so therefore I can only say 777X has zero orders.
 
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Boeing778X
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 4:30 pm

Quoting PhoenixVIP (Reply 47):
Sorry I understand what you mean entirely, but check my signature. That's the comment from our most renowned A380 is dead poster on here so therefore I can only say 777X has zero orders.
Quoting PhoenixVIP (Reply 47):
Quote: "I don't think anyone can call orders for an aeroplane that hasn't flown yet truly firm". #lolfail 777X/NEO/MAX!
Quoting Alfons (Reply 48):
For Airbus
- a stronger bond between EK and Airbus (future products).
- EK recognizing Airbus as being a new valuable partner to work with (long-term).
- Airbus winning a new (updated) engine for free.
- Airbus winning (maybe) half of the work for a stretch for free.
- Airbus showing a stronger presence on the market due this first, having a big airline company believing in it (marketing value). -> can create "wanna have too" 's ?
- Airbus increase of financial rating in the bank & investment sector? (not due to a sales success of the A380, but as a stronger and experienced negotiator with its customer base and managing to bind sales)

For EK
- The first A380Neo deliveries with zero mistakes, perfect floor carpets, as customization wishes have been taken very much in advance by Airbus and worked on.
- Better ties to Enders and Airbus and shorter decision times/cycles for any future projects or customization wishes (on other ac models).
- An Airbus cooperation listening to Clark regarding any A380Neo successor or model updates?
- A stronger union between Clark and Kent... äh Enders, sorry.
- An increase of social currency for Clark to its Stakeholders (government, owner etc.). (personal benefits not to underestimate)

For the market
- a first which could shape the ac sales business a bit for the future. My thought about that: the bigger airlines today procure Airbus as well as Boeing products, as (seems like) commonality isn't what offers today the biggest efficiency ($$), but the perfect product match for the predefined operation it was envisaged for. Because what is more "efficient" than a dress which has been modelled directly from the body of a man and/or a woman (for best look)?
- could paying development costs to Boeing and Airbus for an update-to-perfect-match reduce the overall lifetime costs, and become a new sales model?
- put in here whatever comes into your mind

  

But if Airbus does this, they better expect to sell to only EK and a few.

It's like the 747 story in reverse.

Quoting Jacobin777 (Reply 52):
Nov 17, 2013 Germany Lufthansa 0 20 20[45]
Nov 17, 2013 United Arab Emirates Etihad Airways[n 1] 8 17 25[45][46]
Dec 20, 2013 Hong Kong Cathay Pacific 0 21 21[45][47]
Jul 9, 2014 United Arab Emirates Emirates 35 115 150[45][48]
Jul 16, 2014 Qatar Qatar Airways 10 50 60[45][49]
Jul 31, 2014 Japan All Nippon Airways 0 20 20[45]
Jun 4, 2015 Unidentified Customer(s) 10 10[45]
Totals 53 243 306[45]

And then we have airlines like ET, TK, possibly VN and (perhaps) BA who could order it in the immediate future. The 777X has a very bright future, despite what PhoenixVIP would have us think.

It going to take me all day do get over that statement!
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Revelation
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 4:58 pm

Quoting PhoenixVIP (Reply 42):
The 777X has zero orders
Quoting PhoenixVIP (Reply 47):
Sorry I understand what you mean entirely, but check my signature.

Please stop it. Your posts are confusing enough to start with -- you often don't seem to use the 'QUOTE SELECTED TEXT' button when quoting other members -- and it's even worse if you then expect us to read your signature and use that to interpret your posts. Enough already.
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bmacleod
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 5:16 pm

Is the A380neo just more of a money pit?   

How much in fuel and maintenance costs will really be saved over the standard version?
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astuteman
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 5:31 pm

Quoting Jacobin777 (Reply 52):
Huh?
Quoting Boeing778X (Reply 53):
"777X has no orders and is in more trouble than the A380."

LLLOOOLLL! What?!
Quoting Revelation (Reply 56):
Please stop it.

What's with the sarcasm (and irony) failure guys?
In another clear bid to diss Airbus, Nav (pick your number) clearly said that a plane that hasn't flown yet effectively can have no orders.
PhoenixVIP's comments are entirely sarcastic - you guys are supposed to be intelligent enough to pick that up.
The irony of course is that the comment entirely backfires on his beloved "400+seat twin 777X"

This used to be a place to come for fun, but it SO isn't now.
Clearly not following the a-net mantras now makes one some sort imbecile these days.
Do you guys not know when to lighten up any more?
You used to.  
Quoting david_itl (Reply 54):
Not per NAV30's way of thinking. Not flown therefore no orders

I got it, David, FWIW

Rgds
 
Hamlet69
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 5:34 pm

Quoting PhoenixVIP (Reply 42):
I took less than 24 hour for our usual idiots and suspects to start trolling in here.

And it took you less than 5 hours to respond in kind.   
All gave some. Some gave all.
 
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Polot
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 5:53 pm

Quoting astuteman (Reply 58):
--

There is a difference between fun and borderline harassment and obsession, which is something PhoenixVIP is getting to close to.

Yes NAV30 or whatever said that once, I remember it too. That was weeks ago in a completely different thread however. Time to move on and stop bringing it up at every opportunity and completely derailing any thread regarding the 777X/A380neo or whatever with it especially as it completely confuses everyone who hasn't devoted their life to the A380neo threads.

Its getting to be just as ridiculous/childish as when some poeple were constantly complaining about the term whalejet (remember when that term was a no-no here?)

[Edited 2015-10-17 11:03:07]
 
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Devilfish
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 6:05 pm

Quoting Amiga500 (Reply 45):
They'd be safer taking the A380-800 fuselage, putting a new wing and twin engines on it, then calling it the A360.

Apparently, they called it the A370...    ...

http://pages.videotron.com/camsim/Page%20370_bleu_1024.jpg
http://pages.videotron.com/camsim/Page%20370_bleu_1024.jpg
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LAX772LR
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 6:17 pm

Quoting Matt6461 (Thread starter):
With 146 aircraft to deliver a good fifteen of which is uncertain (4 Transaero, 6 Virgin, 2 Air France, Air Austral 2)

Is this just bad math, or is there another outstanding order in trouble? LH's cancelled 1?


Quoting Boeing778X (Reply 3):
more than half of those are going to EK

EK has 44%.
I myself, suspect a more prosaic motive... ~Thranduil
 
SelseyBill
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 6:19 pm

Quoting Finn350 (Reply 19):
Quoting tortugamon (Reply 14):When they talk about EK financing A380neo, they probably actually mean some form of risk-sharing in the A380neo development program (as EK would in any case be financing the program being the largest customer by far).

EK ' financing ' the A380NEO programme could take place in many 'invisible' forms.

For example; Airbus and EK could agree; (and probably have already); on a baseline 'discounted' price per frame; say 30%.

To help 'finance' the programme; EK might agree to a revised A380NEO discount rate of say 20% or 25%.

Nobody outside Airbus or EK would be any the wiser.........
 
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Clipper101
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 6:20 pm

I am still confused on what an A380neo is expected to be? New engines & some aerodynamic improvements is what EK is asking for. New engine is understood, but what kind of aerodynamic improvements should we expect other than the usual option of a new outer wing tip/fence!

Usually ‘neo’ variants from Airbus & ‘X’ variants from Boeing came in with new wing platforms associated with the introduction of a new engine, this is on the outside. In the inside, lots of systems/avionics improvements have been incorporated. Yes, I know the A320neo; at least its wing got a new outer wingtip ‘shark’let & internal structural enhancements to account for the increased induced aerodynamic torsion (albeit the sharklet is introduced earlier than new engine)

When following-up all along on the discussions over A380neo, I am getting to a conviction that touching current wing could spell to an A380neo in a combination of a new wing platform plus new engine (on the outside, do not know if there would be any improvements regarding systems/avionics)

So, when we are talking A380neo, what exactly we are talking about?
 
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PW100
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 6:24 pm

Quoting Boeing778X (Reply 55):
Seriously?

I hope you do realize that that comment should not be aimed at PhoenixVIP?

Not that I concur with his stubborn campaign. But on this part of his campaign against a certain poster, he does have a very valid point. Of course said poster has not yet bothered to respond to that, thus invalidate his own ridiculous argument.
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jacobin777
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 6:26 pm

Quoting david_itl (Reply 54):
Not per NAV30's way of thinking. Not flown therefore no orders. Or as PhoenixVIP put :

There was no "funny", "sarcasm", etc. emoticons - it was nothing more than asinine tripe.

Quoting astuteman (Reply 58):
What's with the sarcasm (and irony) failure guys?

Calling people "trolls" and "idiots" is neither sarcastic nor funny. I find it to be rude and disrespectful - no matter how biased, pragmatic or incorrect someone's view(s) is.

Quoting astuteman (Reply 58):
In another clear bid to diss Airbus, Nav (pick your number) clearly said that a plane that hasn't flown yet effectively can have no orders.

I think many (dis)agree on Nav's (as well as other members) views, opinions, etc. but that doesn't mean one has a right to disparage other members.


Regarding the subject matter, as an aviation fan I would love to see an A389NEO -especially @SFO   .

Should EK (part) finance it? I really don't think so as there would be many risks - from financial to legal.

Should Airbus decide to build it? I certainly don't know. IIRC, the RR was/is willing to take on the engine risks so that would definitely mitigate some financial risk for Airbus.
"Up the Irons!"
 
PanAm1971
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 6:33 pm

This is exactly the type of creative financing that I thought would propel the Neo into reality. EK needs this aircraft badly. Airbus wants the A380 project to go forwards. This is a flagship aircraft for both EK and AB. They will share the risk. In my opinion this WILL happen.
 
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Clipper101
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 6:44 pm

Did it happen ever in commercial avaition history that when a customer wanted a new aircraft so bad the manufacturer offered the customer to finance it !!
 
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Revelation
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 6:52 pm

Quoting Polot (Reply 60):

There is a difference between fun and borderline harassment and obsession, which is something PhoenixVIP is getting to close to.

Yes NAV30 or whatever said that once, I remember it too. That was weeks ago in a completely different thread however. Time to move on and stop bringing it up at every opportunity and completely derailing any thread regarding the 777X/A380neo or whatever with it especially as it completely confuses everyone who hasn't devoted their life to the A380neo threads.

Agree 100%.

Quoting Clipper101 (Reply 64):
I am still confused on what an A380neo is expected to be?

I think the main point of interest from this report is that it gives us a window into what Airbus is currently pitching to EK: a NEO with "Rolls Royce Trent derived XWB engines installed today on the A350-900" that would cause "3 billion". Euros, I presume.

Even though that's not much detail, it does eliminate a lot of things some people here earlier suggested would be different i.e. use of RR Advance, etc.

Quoting PanAm1971 (Reply 67):
This is exactly the type of creative financing that I thought would propel the Neo into reality.

Yet we read "Visibly Emirates would not be willing to finance such co-development".

[Edited 2015-10-17 11:55:25]
Wake up to find out that you are the eyes of the world
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PanAm1971
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 6:57 pm

Quoting Revelation (Reply 69):
Yet we read "Visibly Emirates would not be willing to finance such co-development".

Fair enough. But in my opinion they will share the risk. The end result, however they decide to share that risk, will be the same.
 
Aircellist
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 6:59 pm

I concur with Astuteman. Please, gentlemen, ease it up…

Nav30's question, however unpleasant, has some merits. The first Concorde and the first 747 rolled out and first flew shortly after my birth. A that time, common thinking was that gaining speed was natural, and so was mass transit by giant airplanes, for the less affluent ones.

We've seen Concorde out of production, then out of service, without any plan to replace it, because the actual world and the common thinking about the future had changed. Speed has become a frontier we will back up from.

Now, twins have become giant planes in their own being. Albeit, a little bit less giant than the "real big giants". But, maybe it's just enough? The question remains, was the A380 launched before its time, or instead is the A380's time already past? The logic of the bigger planes to alleviate saturation at big airports has some merits, but the logic of selling every ticket at the highest possible margin also has merits, and favours a relative scarcity of seats that contradicts the previous one. I believe that is the real point of market fragmentation.

Case in point: the launch of the A321neoLR, that some see as flourishing, in a few years, on the North Atlantic: that is going the opposite way from the A380. And, if that happens, those will be used to fragment traffic away from the big transatlantic hubs, on both sides of the pond. The scarcer seats will be sold as an advantage, less transfers, shorter time, and so and so, but in fact those advantages will be paid for by the customers.

And the airlines have become masters at that game, too: looking at fare comparing sites, I've seen that most sites offer the very exact same tickets at the very exact same prices, and that airlines will charge more if there are less connexions, less waiting time, no airport transfer, and forfeit a bit of revenue when the traveling conditions are not so much easy.

When I was a kid, the "buzz" factor of flying in a 747 was quite strong. Nowadays, not so much, alas… Many paradigms have changed in the meantime.
"When I find out I was wrong, I change my mind. What do you do?" -attributed to John Maynard Keynes
 
PanAm1971
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 7:13 pm

Just as a sidenote-I remember when Nav30 was Nav20 and he was a respected commenter on Anet. Then after being away from the forums for a year or so I come back and there are members who literally chase him around from one thread to another... including one gentleman from China who has a zeal that borders on disturbed. What happened?
 
highflier92660
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 7:15 pm

Perhaps this could mean Tim Clark will finally get his "big stretched" version of the A380 he desires. The A380- as she exists now- is so over-winged that a combination of the more powerful RR Trent XWB engines with larger fuselage plugs would result in an aircraft the designers original envisioned.
 
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Clipper101
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 7:36 pm

Quoting Highflier92660 (Reply 73):
Perhaps this could mean Tim Clark will finally get his "big stretched" version of the A380 he desires.

As I understood it from one of those links on A.net few days back quoting STC that he is content with current A380 size. So to the contrary, reading between the lines tells me this could be as if giving Airbus free hands to think of a new wing platform suitable only for a -800 without looking to put in mind a growth version if they want to go for an A380neo
 
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MrHMSH
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 7:52 pm

Quoting Aircellist (Reply 71):

Now, twins have become giant planes in their own being. Albeit, a little bit less giant than the "real big giants". But, maybe it's just enough? The question remains, was the A380 launched before its time, or instead is the A380's time already past? The logic of the bigger planes to alleviate saturation at big airports has some merits, but the logic of selling every ticket at the highest possible margin also has merits, and favours a relative scarcity of seats that contradicts the previous one. I believe that is the real point of market fragmentation.

The A380 does have use, but I would tend to agree with the statement that twins have if not killed off, at least significantly lessened the need. Airlines are generally happier with the less risky, more flexible and more recession-proof twins. So the time of the VLA has passed as anything other than a niche (although very glamourous niche). EK are an exception due to their business model, but as a general rule, A380 fleets are not going to be much higher than 20, and at best there are roughly 20 airlines that can get the best of the plane at all.

Quoting Aircellist (Reply 71):
Case in point: the launch of the A321neoLR, that some see as flourishing, in a few years, on the North Atlantic: that is going the opposite way from the A380. And, if that happens, those will be used to fragment traffic away from the big transatlantic hubs, on both sides of the pond. The scarcer seats will be sold as an advantage, less transfers, shorter time, and so and so, but in fact those advantages will be paid for by the customers.

I thought the 788 would be the driver of this, but I think it's actually the 789 that is, and even the A350 might have a good crack at this. I agree on the A321neo(LR), it's a real winner. It is still a little bit of a risk, but it would be great to see smaller cities being opened up to TATL service, as well as thin routes from pretty much everywhere. I think the proportion of passengers avoiding hubs will increase as the new aircraft become more common, even if the absolute number will stay similar or rise that go through hubs. Excluding the ME3 hubs!
 
airzona11
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 8:24 pm

Quoting PhoenixVIP (Reply 43):
When I started flying and still today I see four engines for large and long haul. That's the 747 and A380 hence we see airlines dumping A340 and rightly so. Two engines are enough for 360 passengers but not 650 plus. Trashing is someone who is too ignorant to understand factual information and progress is the rest of this thread and it's appropriate posts. The trend in aviation is to go up because not enough room for all our airlines. Look at how horribly cramped DXB has become and LHR and HKG are there too.

Every other plane, besides the A380, that is selling and popular, is a twin engine (both single and twin aisle). Larger twins are the future, the market has spoken. There is a role for the A380. It is a smaller role.
(this is a not a caustic diss or insult to the A380, it is a great plane, great plane to be a passenger on etc).

The trend is not for larger 4 engine planes. It is for larger twins (A35K, A321, 789/10, 77W,77X, A333/9, 739). Period.

Point to Point and Frequency here. Are there even any examples of A380 reducing frequency vs up-gauging routes? LHR, HKG, DXB in all of those airports, I cant see an airline that has taken a daily jumbo and switched to a 6 weekly A380. Or replaced 2 smaller flights with 1 A380. Has this happened?

For Airbus, the biggest question is going to come back to the return on capital, regardless of Emirates financing or not. I agree with the posters leaning toward this an Emirates push have Airbus commit to a NEO.
 
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Clipper101
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 8:27 pm

Quoting MrHMSH (Reply 75):
The A380 does have use, but I would tend to agree with the statement that twins have if not killed off, at least significantly lessened the need.

Now you've got the song "video killed the radio star" playing inside my mind; but, did it?

I still have the conviction that the general public has the final verdict on a twin VLA, whether a twin is technically feasible or not. To some extent in terms of aircraft size, general public feels the comfort of safty of a twin flying 15+-hour legs. That comes probably from their perception that smaller size aircraft sits better in the air during an engine mulfunction and from aircraft safety & 'reliability' records that climed its way up along with aircraft growth in passenger capacity.

Going full double-decker VLA twins may be needing a step in between more towards a B747 1.5-decker style; just same way how twin growth climed its way in a staircase manner towards planes as big as B777/A350 to slowly attain general public comforting trust. So again, it was always about testing grounds as you go from smaller to bigger capacity aircraft.

In my opinion, if anyone want to think of A380 with lesser than four engines then it would be of no less than three.
 
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speedbored
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 8:31 pm

Quoting airzona11 (Reply 76):
Are there even any examples of A380 reducing frequency vs up-gauging routes?

BA reduced LAX-LHR from 3x daily 747 to 2xdaily A380 and claim that they will be making $30m more annual profit from the route by doing so.
 
tortugamon
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 9:25 pm

Quoting olle (Reply 37):
Perhaps they will make this as a bigger down payment when ordering their 200 neo? I can imagine that the emirate canceling their A350 made management in Airbus nervious...

I don't think its really a matter of cash management but program ROI and right now Airbus is having a hard time estimating an acceptable return on invested capital with a high degree of certainty - a calculation that won't change much with high deposits from EK.

Quoting HALtheAI (Reply 40):
Airbus will want EK to take at least 20/year if there are little or no other customers, but that's highly problematic early on.

Isn't EK taking more than 20 this year and/or next? Clearly they have shown to be able to take a high number of aircraft. Your question though is extremely important. And the degree that Airbus has faith in that answer is also important.

Quoting PanAm1971 (Reply 67):
EK needs this aircraft badly.

I think this is a little over-stated. They definitely need the A380 and if there is a major improvement to it, it will greatly help their operations and finances. For sure. But badly? Imminently?

Presumably EK's A380s are on 12-year leases and the first arrived in 2008 meaning that 5 A380s will be due to be returned around 2020. 3 arrived in 2009 and due to be returned 2021....8 in 2010/2022....5 in 2011/2023....So that is 21 aircraft that will hit their 12-year lease date within the next 8 years. EK has mentioned they may extend their leases.

EK operates ~18 777s that are older than 12 years old (some are 18 years old). Would it kill them to do the same thing with their A380s? EK's first 77W was due to be returned to lessors in 2017 and they wanted the 77X then, they are getting it in 2020 instead (three years later) which has a better overlap with the meat of the replacement market for other operators. Would it hurt to do the same thing with the A380s?

EK has stated that they can't operate more A380s at DXB implying that they may not even need many before they move to DWC (2025) so is delivering a new aircraft before they move that urgent? I believe other traffic being diverted to DWC before EK's move will open up space for the A380 at DXB but I am not sure about the number.

I believe the urgency we are seeing on this program is due to everyone acknowledging that the program needs more orders for it to continue production and is not being driven by Emirate's needing this aircraft 'badly'. Eventually yes, imminently no.

That is why I see a small change imminently (not a true neo) to improve its chances for orders in 2018-2023 (read: Keep EK happy) and then a major improvement 2025+.

tortugamon
 
airzona11
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 9:26 pm

Quoting speedbored (Reply 78):
BA reduced LAX-LHR from 3x daily 747 to 2xdaily A380 and claim that they will be making $30m more annual profit from the route by doing so.

Did not know that, thank you for that info.

It would be splitting hairs, but AAs added 77W frequency (now 2x 77W with JV) that is still the same amount of slots used at constrained LHR, with increase in seats.
 
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par13del
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 9:35 pm

Quoting SelseyBill (Reply 63):
EK ' financing ' the A380NEO programme could take place in many 'invisible' forms.

For example; Airbus and EK could agree; (and probably have already); on a baseline 'discounted' price per frame; say 30%.

To help 'finance' the programme; EK might agree to a revised A380NEO discount rate of say 20% or 25%.

Nobody outside Airbus or EK would be any the wiser.........

If that happens I guess it will put an end to all the threads on the WTO rulings against Boeing Tax Breaks etc etc etc.
 
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Devilfish
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 9:46 pm

"Everyone is entitled to my opinion." - Garfield
 
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HALtheAI
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 9:54 pm

Quoting Matt6461 (Reply 17):
Bjorn Fehrm at Leeham News (a true expert) says the TXWB would give only ~5% SFC margin versus the current T900. That story is behind a paywall at Leeham though.

Re future PIPs, GE has floated a ~2.5% PIP for the GP7200, which would be replaceable on the current wing. I'd guess RR could do about the same. Combining that number with Bjorn's we're about 2.5% from the TXWB.

Kinda cherry-picking there by assuming that the Trent XWB doesn't receive a PIP of its own during that time period.

Quoting Stitch (Reply 51):
Airbus and Rolls will be able to use RLI to cover a third of the development costs and while Rolls might have some issues with credit / cashflow, Airbus certainly does not. So I don't see this as Airbus needing Emirates to actually front a billion or two Euros to fund the development.

Airbus will not want the production rate to fluctuate so I can see them wanting Emirates to agree to a pre-determined delivery schedule (with penalties for not taking frames on said schedule).

It's less about Airbus needing the money than ensuring that if EK's growth predictions turn out to be overly optimistic, EK doesn't make any adjustments to their order. A large deposit from Emirates protects Airbus better against such a possibility. Airbus also has to take into consideration a MH-style meltdown for EK, even if very unlikely. Airbus doesn't want to get stuck in a line with all the other creditors to collect any 'penalties'. If Airbus is going to invest billions in an A380neo, they want rock-solid assurances that those A380s will be bought.

Quoting Clipper101 (Reply 74):
As I understood it from one of those links on A.net few days back quoting STC that he is content with current A380 size. So to the contrary, reading between the lines tells me this could be as if giving Airbus free hands to think of a new wing platform suitable only for a -800 without looking to put in mind a growth version if they want to go for an A380neo

Sir Timmy only said an A380neo needn't necessarily include a stretch, presumably if that would appeal more to other airlines like SQ and QF. He never said anything about EK's own preferences, which I doubt have changed.

Quoting tortugamon (Reply 79):
Isn't EK taking more than 20 this year and/or next? Clearly they have shown to be able to take a high number of aircraft. Your question though is extremely important. And the degree that Airbus has faith in that answer is also important.

You addressed that yourself later in your post. Right now DXB still has space. But what about after Emirates has taken delivery of all 140 they currently have on order?

Quoting Revelation (Reply 69):
Even though that's not much detail, it does eliminate a lot of things some people here earlier suggested would be different i.e. use of RR Advance, etc.

The RR Advance idea was pretty much put to bed a couple months back in one of the other countless A380 threads, based on this news article:
WSJ: Rolls-Royce CEO Pledges to Speed Turnaround Efforts
Quote:
The engine maker also remains in talks with Airbus about new projects. The European plane maker is exploring an upgrade to its A380 superjumbo with new engines. Rolls-Royce Chief Financial Officer David Smith said the company is considering providing an engine, though the development costs would have to be below those for a brand-new turbine. An engine for the A380neo, as the plane has been dubbed, “needs to make a business case at a lower volume,” Mr. Smith said.
 
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Clipper101
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 10:38 pm

Quoting Devilfish (Reply 82):

See my Reply (74):

Quoting Clipper101 (Reply 74):
As I understood it from one of those links on A.net few days back quoting STC that he is content with current A380 size. So to the contrary, reading between the lines tells me this could be as if giving Airbus free hands to think of a new wing platform suitable only for a -800 without looking to put in mind a growth version if they want to go for an A380neo

I do not really believe there will be a -900   
 
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Clipper101
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RE: Airbus Presses EK To Finance A380neo

Sat Oct 17, 2015 10:48 pm

Quoting HALtheAI (Reply 83):
Sir Timmy only said an A380neo needn't necessarily include a stretch, presumably if that would appeal more to other airlines like SQ and QF. He never said anything about EK's own preferences, which I doubt have changed.

To be more clear since this debate includes quotations, I was referring to this article from flightglobal dated Oct. 1st, 2015:

https://www.flightglobal.com/news/articles/emirates-to-choose-between-a350-900-and-787-10-next-417326/

In which it quotes him of stating: "He adds that an A380neo would not have to be a bigger aircraft, but that a new engine and aerodynamic tweaks could make the existing A380 up to 13% more economical."

[Edited 2015-10-17 16:00:48]
 
prebennorholm
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RE: Airbus Presses EK To Finance A380neo

Sun Oct 18, 2015 1:24 am

Quoting HALtheAI (Reply 83):
It's less about Airbus needing the money than ensuring that if EK's growth predictions turn out to be overly optimistic, EK doesn't make any adjustments to their order. A large deposit from Emirates protects Airbus better against such a possibility. Airbus also has to take into consideration a MH-style meltdown for EK, even if very unlikely. Airbus doesn't want to get stuck in a line with all the other creditors to collect any 'penalties'. If Airbus is going to invest billions in an A380neo, they want rock-solid assurances that those A380s will be bought.

I think you are very right on this, HAL. It is not like Airbus would have any problems to finance a NEO. They just want to be pretty sure that the money is well spent.

It is not long time ago when EK just overnight cancelled an order for 70 A350.

While it had little or no impact on the foreseeable A350 production schedule, then it would be an entirely different story if EK ordered 100 A380neo, and then cancelled it when a couple billion had been spent on making it.

I am, however, not very optimistic about a neo in the near future. People, including Tim Clark, generally seem to expect a double digit improvement. I don't think Airbus can deliver more than 6-7-8%, and then only at a somewhat higher sticker price, reducing the gain to near nothing. The current A380 is simply too good and efficient, and its engines are already so much more efficient than slightly older engines such as CF6, T700 or PW4000.

The Trent XWB seems to be a marvel, but it comes at a price, sticker price. It's a very complicated engine made of very exotic materials.

Thank God the A350 only has two of them. But the A380neo shall have four of them. Four TXWBs is an enormous pile of money, much more than four T900s.

With only single digit efficiency gain it takes both very long time and very high fuel prices to "earn" just the extra engine costs. And very high fuel price isn't exactly what helps sale of very large aircrafts.

I have a feeling that for the time being airlines prefer to invest in "too small" aircrafts in order to improve fleet flexibility. So many things have happened lately to scare them: SARS, Ebola, GFC, volcanic eruptions, fuel price fluctuations etc.

All these events ended up rather "contained" and didn't really become catastrophic for the market. But had just one of them escalated violently, then the survivors would have been those who could park half of the fleet in the desert, and continue a decent schedule, because they already had too many aircrafts which were all too small.
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qf2220
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RE: Airbus Presses EK To Finance A380neo

Sun Oct 18, 2015 1:36 am

Quoting Aircellist (Reply 71):
Speed has become a frontier we will back up from.

Cost of speed was the issue - I fully expect supersonic travel to come back onto the drawing board somewhere in the future.
 
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zeke
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RE: Airbus Presses EK To Finance A380neo

Sun Oct 18, 2015 1:58 am

Quoting Matt6461 (Reply 4):

For an airline that is not interested in the type they spend a long time evaluating it, and have senior managers fly it.

Quoting travelhound (Reply 23):

The anti-trust thing maybe just in the US, Korean are a risk sharing partner, and manufacturer to various airliners. The UAE have been trying to establish aircraft manufacturing base, a risk sharing partnership may have spin offs beyond just financing, it may enable the UAE to manufacture as part of the deal.
Human rights lawyers are "ambulance chasers of the very worst kind.'" - Sky News
 
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SEPilot
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RE: Airbus Presses EK To Finance A380neo

Sun Oct 18, 2015 2:15 am

Airbus stated some time ago that they would not do the A380NEO for a single customer. I believe at the time they thought that more customers would emerge, but that does not appear to have happened. I see this as an attempt to walk back the original statement, and find a way to do it for just one customer, as Airbus obviously REALLY wants to do it. But when everything gets hashed out, they are still looking at doing it for just one customer, and the objections to doing that are just as valid now as they were when the statement was issued. And then there is the issue of production rate, which has been mentioned by several posters. A senior Airbus official is on record as saying they need to produce 30 per year in order to make a profit, and I do not see any way that EK can take that many, especially as they will be replacements. This sounds to me to be a desperate move by Airbus, and one in which EK is (wisely) not very interested,
The problem with making things foolproof is that fools are so doggone ingenious...Dan Keebler
 
NAV30
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RE: Airbus Presses EK To Finance A380neo

Sun Oct 18, 2015 2:27 am

Trying to clarify my comment, which caused so much quarrelling, the point I was making was in response to someone claiming that there were 'firm orders' for an aeroplane that hasn't flown yet.

It's axiomatic that if someone has ordered a new model that hasn't flown yet, and the new model eventually fails to meet the specified performance, the prospective purchaser has the option of voiding the contract. That would apply both to any upgraded B777 AND to any upgraded A380. Therefore using the term 'firm' is inappropriate until the aeroplane can be shown to have met specification.
 
tortugamon
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RE: Airbus Presses EK To Finance A380neo

Sun Oct 18, 2015 2:44 am

Quoting SEPilot (Reply 89):
A senior Airbus official is on record as saying they need to produce 30 per year in order to make a profit

You may catch some heat for the holy A380 crowd. The CFO and CEO said they will make a profit on the A380 this year (unit level) and they will not deliver 30 this year. Also, from what I remember of the quote, it was that they will need to deliver 30 in 2015 to make a profit but I don't remember reading anything that says that every year they need to produce 30.

I definitely concede that if you deliver fewer planes you have a much harder time breaking even and that is something a few A380 defenders can't bring themselves to say.

tortugamon
 
PlanesNTrains
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RE: Airbus Presses EK To Finance A380neo

Sun Oct 18, 2015 2:50 am

[quote=Jacobin777,reply=66]Regarding the subject matter, as an aviation fan I would love to see an A389NEO -especially @SFO

Bring it! And throw in a few of those A370's shown up thread.  

-Dave
-Dave


MAX’d out on MAX threads. If you are starting a thread, and it’s about the MAX - stop. There’s already a thread that covers it.
 
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IslandRob
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RE: Airbus Presses EK To Finance A380neo

Sun Oct 18, 2015 2:56 am

Quoting SEPilot (Reply 89):
I see this as an attempt to walk back the original statement, and find a way to do it for just one customer, as Airbus obviously REALLY wants to do it.

I get exactly the opposite impression. I think Airbus would dearly love to skip NEOing (let alone NWOing) the A380 for the time being, and instead focus on PIPs. I think they're merely trying to call EK's bluff by asking EK to "put up or shut up", all the while believing and/or desperately hoping that EK will just shut up and buy more A380CEOs. -ir

[Edited 2015-10-17 19:58:19]
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Ruscoe
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RE: Airbus Presses EK To Finance A380neo

Sun Oct 18, 2015 3:13 am

Quoting Aquila3 (Reply 28):
Quoting NAV30 (Reply 27):
I don't think Emirates (and maybe others) really think that the falling sales of the A380 are due to the lack of 'new engines.' I think that it's more a matter of the 'big twins' now being 'reckoned' to be capable of carrying over 400 passengers with only two of the things

This is an important point. The only reason to have four engines is to get the thrust necessary to move the mass.

The reliability issue is no longer relevant, and if a four engine aircraft is going to have game changing economics, it needs to be very large. Large enough to need 4x110,000 engines, but then all the other constraints come in to make this very likely impossible.

Cheers

Ruscoe
 
justloveplanes
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RE: Airbus Presses EK To Finance A380neo

Sun Oct 18, 2015 3:35 am

Quoting MrHMSH (Reply 7):
That's quite an unprecedented proposal in this day and age. I see why EK wouldn't want to co-finance the aircraft, which says something given how much EK has compromised to enable an A380neo.

I think somehow, somewhere, Dubai will come up with the money. This was I think apparent from the start. EK and/or Dubai finances this development (using every trick they can, A350's, switch to RR.... PLUS Cash), or this project doesn't fly.

This project can't fly in anyway I can see except via EK financing. And somehow... they will do it. It is essential to their brand and probably their network.... and it is in the strategic interests of the Emirate of Dubai.

So I think the NEO will happen, I think we are seeing a protracted dance working out the price that will be paid to Airbus to do it.
 
81819
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RE: Airbus Presses EK To Finance A380neo

Sun Oct 18, 2015 3:52 am

Quoting justloveplanes (Reply 95):

...or they can just pressure Boeing to develop the 777-10X instead.

From where I sit EK are highly leveraged with the A380. It could be good business to de-risk and bring another model type into the fold....and with the A380 quickly running out if orders, the sooner, the better!
 
NAV30
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RE: Airbus Presses EK To Finance A380neo

Sun Oct 18, 2015 4:11 am

Quoting travelhound (Reply 96):
It could be good business to de-risk and bring another model type into the fold....

The ME3 have so far placed 235 orders (I should perhaps say 'provisional' orders  ) for the B778/9Xs - with Emirates well 'in the lead' with 150. Hard to see the A380 continuing to sell in large numbers once those become available?

https://en.wikipedia.org/wiki/Boeing_777X#Orders
 
tortugamon
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RE: Airbus Presses EK To Finance A380neo

Sun Oct 18, 2015 4:11 am

Quoting IslandRob (Reply 93):
I think Airbus would dearly love to skip NEOing (let alone NWOing) the A380 for the time being, and instead focus on PIPs

I think so too.

Quoting justloveplanes (Reply 95):
It is essential to their brand and probably their network.... and it is in the strategic interests of the Emirate of Dubai.

Don't you think that might be overstating it a bit. EK has backed off the rhetoric lately and was actually more heated about the 77X being delayed than he has been about the A380neo. He talked about extending leases and at least the way I read it he seems more relaxed about this.

They haven't even received half of their 140 A380s yet. How can the replacement for an aircraft they haven't even received yet be so essential that it is the strategic interests to the UAE?

Eventually they will have a large fleet of A380s and eventually that fleet will need to be replaced. I think they need to take a deep breath or they may get themselves in trouble and have to call the airline Khalifa Air like they were forced to do with the Burj  .

Quoting travelhound (Reply 96):
...or they can just pressure Boeing to develop the 777-10X instead.

We've got a thread for that  New Information About A Possible 777-10X? (by tortugamon Oct 17 2015 in Civil Aviation)

tortugamon
 
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enzo011
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RE: Airbus Presses EK To Finance A380neo

Sun Oct 18, 2015 6:22 am

Quoting NAV30 (Reply 90):
Therefore using the term 'firm' is inappropriate until the aeroplane can be shown to have met specification.

What happens with a program that is delivering to airlines and is still not meeting specification though? You can only meet specification by building and delivering a frame and seeing the numbers, not by using computer models. If you fall short with the first 100 frames does this mean they are not 'firm'? Could we then say that Boeing still hasn't delivered any 787s yet or had firm orders?   
 
NAV30
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RE: Airbus Presses EK To Finance A380neo

Sun Oct 18, 2015 6:51 am

Quoting Enzo011 (Reply 99):
What happens with a program that is delivering to airlines and is still not meeting specification though?

If a program doesn't meet specification or suffers delays (in ANY field) the 'usual' remedy is a financial deal - usually a lower price for early models; plus, of course, any necessary up-grading ASAP. In the case of the first two B787 models, as far as I know they have now basically 'met specification,' though not without lots of early snags/delays; and are in full production. No doubt early purchasers received substantial discounts for the delays. Remains to be seen how the 787-10 turns out, but it should be a lot more straightforward.

The same principles will apply to the various Airbus A350 models now entering production.

It's important to bear in mind that neither manufacturer expects to make lots of money from the 'big' types - both main firms really depend on the 'single-aisles' to bring in most of the profits..........

[Edited 2015-10-18 00:15:36]
 
Planesmart
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RE: Airbus Presses EK To Finance A380neo

Sun Oct 18, 2015 7:14 am

Not only is EK the major operator, but EK, Dubai and related parties, are major participants in the lease syndicates. Asking EK to also front with a portion of the development funds may be a step too far.

How will that sit in respect to the unit price EK pay? And the source and interest rates applied to the development funding? I can see Boeing and US interests having issues.

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