The Airbus A380, to put it as kindly as is possible, has been a mixed success. The giant airliner has flown millions of passengers billions of miles in safety, comfort and for the elite, in luxury. Yet the 555-passenger four-engine aircraft has been a commercial failure in most corners of the world, with just 331 orders (229 delivered) 13 years after its first flight.
But there is one market that has proved a paradise for the A380, the Persian Gulf. More than half of all A380 orders (182 of 331) have come from Qatar (10 orders, all delivered), from Etihad, the second-largest carrier of the United Arab Emirates (10 orders, all delivered) and of course from Emirates Airways. So far Emirates has ordered 162 A380 aircraft, of which 104 have been delivered. Emirates' fleet of massive A380 aircraft has played a substantial role in the growth of international air traffic at its hub, Dubai International Airport (DXB). In 2017 DXB handled 88 million international travelers, the most of any airport.
Yet this paradise for the A380 may be lost, due to a disagreement between Emirates, Airbus and engine supplier Rolls-Royce over the most recent order.
Production of the costly plane has perpetually been in danger of cancellation. When a deal for Emirates to buy 38 A380s fell apart at the Dubai Airshow last November, aviation observers feared the worst. However, in January of 2018, John Leahy, the since-retired super salesman of Airbus, managed to pull a final rabbit out of his hat. Emirates placed an order for 20 A380 aircraft, with an option for an additional 16. The order was for a reported $16 billion dollars. Emirates, which operates A380 aircraft with both Engine Alliance and Rolls-Royce engines, noted that “the airline is evaluating engine options for its latest A380 order.”
In practice, however, Emirates has more or less standardized on the Rolls-Royce power plants. Emirates had wanted new engines, but the small size of the order (only 36 planes) and the costs involved made both engine suppliers reluctant to provide completely new engines.
Now Emirates and Rolls-Royce are reportedly at odds on price and fuel burn on the upgraded engines, which are “already falling short of performance parameters.” A deadline to select the engines has been missed, potentially delaying the delivery or threatening the deal outright.
Fuel economy is becoming increasingly important, even for a government-backed airline like Emirates in the oil-rich Gulf. Emirates turned to Rolls-Royce hoping that the newest A380s would deliver enhanced economy as well as power. News that the new engine is falling short of efficiency and performance metrics, on top of the well-publicized problems with Rolls-Royce engines in the Boeing 787 Dreamliner, is not promising for the future of the A380 program.
Ironically, when Dreamliners for Norwegian and other airlines were pulled from service for engine inspection, a leased A380 picked up the slack.
According to Bloomberg, the original engine supplier for the A380, Engine Alliance, has offered to provide Emirates with more GP7200 engines, which a spokesperson claims offer “exceptional fuel burn and durability.” Whether Emirates would see this as anything better than a stop-gap solution, considering their $16 billion investment, is unknown. After a GP7200 on an Air France A380 suffered an engine failure in September of 2017, an enhanced inspection directive was issued for the engines.
The allegedly-firm aircraft order from Emirates was set to keep the A380 production line open until 2029. By then, Airbus hopes gate congestion may make planes like the A380 capable of carrying massive amounts of passengers more desirable. Airbus claims, 80 percent of today’s 58 megacities with more than 50,000 long-haul travelers a day already have significant airport congestion. By 2036 there will be 95 such megacity hubs, presumably with congestion issues as well. Not surprisingly, the Airbus exec tasked with marketing the A380 says, Frank Vermiere, says the cure for such congestion is having the A380 fly to such gate-limited destinations.
The projected doubling of the flying population by 2036 (from 4 billion a year to 7.8 billion) combined with slowing growth in airports could prove a boon to jumbo jets that maximize use of existing airport gates. But even such a jumbo jet renaissance, if it really does come to pass, may come too late for the aging A380, designed more than 20 years ago. Today’s trend is toward fuel-efficient twin jets like the Boeing 787 or Airbus 350. Their smaller capacity (250 to 350 people) is also easier to fill with passengers than the 555-seat A380.
And if Emirates actually needs more A380 aircraft, there might be a surprising number of used A380s available. The closest potential source is neighbor Etihad Airways, whose poor financial performance has led to talk of a merger with stronger partner Emirates. The two UAE airlines are reportedly looking to work together without an actual merger, and putting Etihad’s 10 A380 aircraft under effective Emirates control for crewing and maintenance might work.
Meanwhile, outside Emirates, there is little demand for the A380. A pair of A380 aircraft re-acquired by a German leasing company at the end of a Singapore Air lease will probably be broken up for parts.
Malaysian Airlines has another six A380 aircraft. A former Malaysian CEO claimed that only two of the six A380 aircraft Malaysia owns are fit for operations, while the other four are listed as “Aircraft on Ground” status. Former Chief Executive Officer of Malaysian Airline Systems Dr. Abdul Aziz Abdul Rahman told the Malaysian Star “We've got the wrong aircraft. It is not for us, in Kuala Lumpur, to use A380." However, a Malaysian Airlines spokesperson disputed this, saying, "It is inaccurate to suggest that four of the airline’s A380s are grounded as almost all are being utilized by the airline. One is undergoing its C3 maintenance checks according to schedule, and the other aircraft are deployed to the airline’s Hajj and Umrah charters, which have run nearly every day during the recent Hajj season."
If Malaysin Airlines does eventually seek to unload its A380 aircraft, Emirates would potentially be a logical buyer. Emirates, already maintaining and flying the world’s largest fleet of A380 aircraft, could take the planes off Malaysian’s hands and add them to its armada—or use them for parts.
No doubt Airbus, Emirates and Rolls-Royce are working feverishly to make what might be the last big order for the A380 work. Perhaps the issues can be smoothed out and the deal saved. Even so, the current kerfuffle is a troubling reminder that the manufacturing lifespan of the world’s largest jetliner, and the thousands of jobs that go along with it, hangs by a thread.
