Emirates could hasten the end of the Airbus A380

Emirates and Airbus are discussing the future of the A380, which - twelve years after its inauguration - no longer seems to be meeting demand. The airline's strategic update could put an end to the production programme for this giant of the skies.
Emirates
The A380, the mainstay of the Emirates fleet

It is barely twelve years since theAirbus A380 made its first commercial flight under the colours of Singapore Airlines. Its days now seem numbered. In fact, this aircraft, which can seat up to 600 passengers, has been only half a success. It is only present in the fleet of 15 international companies worldwide, including Air France, British Airways and Lufthansa in Europe.

As of January 2019, Airbus reported that a total of 313 aircraft had been ordered or were on order, including 162 aircraft (109 of which were already in service as of 1/01/2019) for the Emirates Airlines. Worldwide, Airbus has 232 A380s currently in service, serving more than sixty cities around the world, including Nice and Paris in French-speaking Europe. No US or African airline can be found in this list...

The aircraft was launched to make up for the lack of airport capacity on very large air hubs on the planet. Because at London Heathrow, New York JFK, Tokyo Narita, Hong Kong or Paris CDG, slots for aircraft have been increasingly rare for decades. The Airbus A380, with its capacity of 500 to 600 passengers, seemed ideal for enabling airlines to increase their seat capacity while keeping the number of movements constant.

Excellent reasoning. Except that in ten years, the air transport industry has totally changed. The emergence of new aircraft more comfortable and more fuel-efficient, or the multiplication of point-to-point lines with the launch of intercontinental flights from secondary destinations.

This situation is even beginning to generate strategy issues for Emirates. The Dubai-based carrier had linked much of its network development to the acquisition of A380s. In fact, it is the airline that operates the most A380s in the world, accounting for 40 % of its total fleet.
Today, Emirates seems to be reaching the limits of this strategy. It is struggling to find new airlines that would support - economically speaking - the introduction of an A380. What's more, thehuge capacity generated by this giant of the skies, forcing the company to offer relatively low price in order to fill its aircraft. Emirates' revenue passenger kilometre (RPK) is one of the lowest in the industry. According to Bloomberg, it stood at 6.891c/RPK, compared with 11.016c for Lufthansa, 9.049c for IAG and 7.431c for Singapore Airlines.

The trend is towards direct non-stop flights on point-to-point routes operated by smaller aircraft. This is the case, for example, with Qantas' London Heathrow-Perth route, operated by a B787, which avoids the need for a stopover in Dubai... And this is just the beginning!

Emirates is the only airline in the world to operate only large-capacity aircraft, known as twin-aisle aircraft. Emirates therefore seems lose flexibility in the face of competition.

According to the Bloomberg press agency, the Dubai-based carrier is considering converting 20 of its 53 A380s into orders for a smaller model, such as the Airbus A350 or even the future version of the Airbus A330 equipped with new engines. Such a decision could prove fatal to the A380, a production programme that still does not appear to be profitable for Airbus. But Emirates has little choice if it is to build up its commercial muscle in the face of competition from other Gulf carriers, led by Qatar Airways.

At the beginning of February, in a press release, Airbus " confirms that it is in discussions with Emirates regarding the A380 contract "He added that the content of the negotiations was confidential. But a swift decision is expected on the future of this aircraft, which remains one of the most popular with passengers for its calm and spaciousness.