Airbus Seeks Extended Warm Reception
Ted Reed
03/27/07 - 12:20 PM EDT
The A380's
U.S. tour last week did not eliminate airline industry doubts, but it certainly bolstered
Airbus' case that the troubled airplane may someday gain a measure of acceptance.
In fact, response to the plane was positive enough that it may have helped to raise expectations for Airbus' other problem child, the A350. "The tour sent a message that despite all the delays and the problems back in Europe, Airbus is capable of an impressive technical achievement," says airline analyst Richard Aboulafia of the Teal Group. "I think [that] is useful for 350 sales."
Dozens of reporters who flew on demonstration flights had generally favorable reactions. "It's helpful to all product lines," said Airbus spokesman Clay McConnell, as the tour concluded. "The A380 is the signature airplane of Airbus right now, [and] it is a rock star that is getting a lot of attention."
Both the A380 and the A350 have been plagued with problems that include cost overruns, delivery delays and a meltdown at parent company
European Aeronautic Defence and Space Company. But the A380, at least, is now flying, and the promise of a 2007 delivery to customer
Singapore Airlines seems likely to be honored.
Having two plane models enables Airbus to compete in two international segments, COO John Leahy told reporters aboard the A380's New York flight. The A380, which can seat 550 to 800 passengers, will fly between hubs. The A350, which will seat 270 to 350, will fly point to point. That distinguishes Airbus from
Boeing(BA Quote). Leahy said Boeing "bet it all on point to point" by focusing on development of the 787, which seats 210 to 330.
So far, of course, the point-to-point aircraft appears to be exactly what customers want. Airlines have placed nearly 500 orders for Boeing's 787, while Airbus' original model of the A350 has lured just 100 orders.
Now Airbus is redesigning the plane. The new model, the A350XWB (for extra-wide body) will be built largely of lightweight composite materials and will more closely match the 787. "It became clear that the 787 was going to be a very good airplane and that Airbus was going to get slammed if they went with the original A350," says Dan Kasper, managing director of consulting firm LECG. "But I don't have any doubt that they can design an airplane that will be a lot more competitive with the 787."
Competing for Customers
Kasper says the A380 flight proves that Airbus "can take on a big engineering and production challenge, and on the engineering side they can solve it." But for the benefit to spill over, he says, carriers must be convinced that Airbus can meet a delivery schedule.
A key battleground is
US Airways(LCC Quote), where executives say they will decide whether to order the 787 or the A350 in the next few weeks. US Airways had an order for 20 A350s, but the redesigned A350XWB "is not the plane we ordered," CFO Derek Kerr told reporters two weeks ago. As a result, the airline is re-evaluating its order. The 787 could be delivered "a couple of years sooner," Kerr said. He declined to say whether the A350 would be cheaper.
Airbus did manage to snag an A350 order last week, as Russian airline
Aeroflot signed a preliminary agreement to buy 22 aircraft. As part of the deal, EADS agreed to give 5% of the work on the plane to Russian companies. Kasper noted that the arrangement reflects a political agreement between "statist economies" in France and the former Soviet Union. Still, an order is an order.
Consultant Scott Hamilton, who publishes an online newsletter about aircraft manufacturers, called the A380 tour "a great PR campaign" but said Airbus has work to do before prospects for the A350 can be regarded as promising.
"This was a great PR tour and the A380, without a doubt, is a really nice airplane," Hamilton said. "But it has yet to go into service, and the A350 is even further away from going into service, and until it does everybody will be wondering if Airbus will have the same sort of [delays] with the A350 as with the A380."
