Airbus logo.
February 14, 2019
Lacking sufficient orders, Airbus will stop producing its flagship aircraft, the A380, whose deliveries will cease in 2021.
Airbus A380-800
Airbus announced Thursday the end of production of the A380, its flagship whose deliveries will cease in 2021, after the company Emirates decided to reduce orders for 39 A380s.
"The consequence of this decision is that our backlog is no longer sufficient to allow us to maintain production of the A380," said Executive Chairman Tom Enders in a statement. "This will put an end to A380 deliveries in 2021".
Emirates replaces this order with another for 40 A330neo and 30 A350. Airbus does not communicate the amount of this order. But in a separate statement, Emirates said the value of this order is $ 21.4 billion at list price. It states that it will receive an additional 14 A380s between 2019 and 2020, bringing its total orders for the aircraft to 123, up from 178 previously ordered, taking all options into account, making it first customer company of the "Super Jumbo", of which more than a hundred has already been delivered.
The aircraft manufacturer says it will "engage in discussions with its social partners in the coming weeks regarding the 3,000 to 3,500 positions likely to be affected by this decision in the next three years".
Decision expected
But according to the manufacturer, "the current ramp-up (production) of the A320 and the new Emirates large-capacity order will offer many opportunities for internal mobility."
This decision was expected: the fate of the A380 was linked to last year's decision by the Gulf Company to acquire 36 additional A380s, giving Airbus "visibility for at least the next ten years", Tom Enders had assured at the time.
But Airbus did not hide that in the absence of this command, the program was doomed to stop. "Frankly, if we do not reach an agreement with Emirates, there will be no choice but to stop the program," said former Airbus sales director John Leahy.
In total, the A380 has been ordered 321 copies, and 232 are in use now, according to the Airbus website.
The decision to stop production of the A380 affected Airbus' financial results for 2018, which were also published on Thursday, with a negative impact of 463 million euros on operating profit.
Last year, Airbus nonetheless saw its net profit increase by 29% to 3 billion euros, and its consolidated sales in 2018 rose 8% to 63.7 billion euros. It plans to deliver between 880 and 890 commercial aircraft in 2019, compared to 800 in 2018.
"Even though 2018 was a challenging year, we met our commitments with record profitability thanks to excellent operational performance, especially in the fourth quarter," said Tom Enders, Executive Chairman.
Airbus A400M
Airbus will also spend a new provision of 436 million euros on the A400M military transport aircraft program. It had spent a charge of 1.3 billion euros in 2017 and 2.2 billion in 2016 on this program.
Despite this, "Airbus is on a solid growth trajectory," said Tom Enders, who will hand over to Guillaume Faury, who heads Airbus' commercial aviation business, in April on the occasion of the group's general meeting.
Related articles:
Cracks in the wing: all the Airbus A380 will be examined
https://orbiterchspacenews.blogspot.com/2012/02/cracks-in-wing-all-airbus-a380-will-be.html
10 years in the skies: the A380’s numbers add up
https://orbiterchspacenews.blogspot.com/2015/04/10-years-in-skies-a380s-numbers-add-up_27.html
Airbus: https://www.airbus.com/
Images, Text, Credits: AFP/Airbus/Armée de l'Air (France)/Orbiter.ch Aerospace/Roland Berga.
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