Earlier this week Airbus announced that they would cut A380 production to 14 aircraft, down from the previously stated 18. Airbus also has intentions to cut down production for 2010 and later years. Many customers have deffered their orders, as many of them stated they would like to build up cash, forcing Airbus to match their moves with production cuts. No earnings hits are predicted so far, but this move will certainly affect their cashflow.
Singapore Airlines, Emirates, and Qantas are still expected to receive A380s. I’ve heard that Air France’s first A380 is expected to enter service sometime this year – initially it was scheduled for April, but I’ve heard it’s been pushed back to September.
Notably, this is the third time that Airbus changed their production plans for the A380. The original goal was 26 aircraft for the year of 2009, but that shifted to just 21 aircraft. Not long ago, Airbus revised that goal and said 18 would be the new number; now it’s 14. However, it is still unknown how many aircraft will be produced in 2010. That will probably be adjusted later – time will tell how well airlines are doing in a year.
The A380 is a good fit for the carriers that fly the aircraft. Had the aircraft not been delayed as much as it was, it would’ve been well-timed. Unfortunately, no one can predict markets and the economy – right now, the A380 is probably a bad fit. Don’t get me wrong, it works well if the airplane has a high load-factor. Once demand shifts back up and the economy is back on its feet, there is no doubt that the A380 is a great plane for these carriers. The A380 is not a recession-proof aircraft (not many are).
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