Japan Refuses To Fly Airbus Superjumbo

The Guardian (UK) ^ | 12-8-2003 | Andrew Clark

[blam]

Japan refuses to fly Airbus superjumbo

Andrew Clark in Tokyo
Monday December 8, 2003
The Guardian (UK)

Japan's two international airlines, which are the world's biggest carriers outside America, have snubbed the new A380 superjumbo in a crushing blow to the European manufacturer Airbus. All Nippon Airways (ANA) and Japan Airlines (JAL) are the leading users of the Boeing 747 jumbo jet, which the A380 is intended to replace, and are regarded as a make-or-break market for the new aircraft.

As recently as last week, senior Airbus executives were saying they expected to sell the A380 to Japan, claiming that the plane could be packed with 900 seats on busy domestic routes between Tokyo and Kyoto or Sapporo.

But the two airlines have resisted intense pressure from Airbus to sign up for the A380. ANA's chief executive, Yoji Ohashi, this weekend ruled out a purchase before 2010, saying he intended to stick to the company's existing long-haul fleet of Boeing 747s and 777s.

Keisuke Okada, ANA's corporate planning director, criticised the design of the superjumbo, saying larger aircraft created too many problems at airports: "Already, when I take a ride on a 747, I have to wait a long time to board - it's a crazy stress." He said baggage handling was frequently "chaos" when jumbo jets, which carry more than 560 people on domestic routes in Japan, arrived en masse.

Experts said failure in Japan leaves the Toulouse-based manufacturer with an uphill struggle to break even on the A380 - to the dismay of the British government, which provided £500m of "soft loans" for the project which are only repayable if the plane makes a profit.

Andrew Doyle, an aviation expert at Flight International, said: "The A380 programme can't be judged a success without sales to Japanese airlines. It's still possible Airbus could make a return on the A380 without them, but it makes it extremely difficult."

The first A380s are due to roll off the production line within three years. The wings are being manufactured in Broughton, Wales.

Airbus has 129 orders for the double-decker aircraft, including deals with Virgin Atlantic and Air France, but says it needs 250 to break even. No American carriers have signed up.

The bosses of 15 carriers in the world's biggest airline partnership, the Star Alliance, met in Tokyo last week to discuss the outlook for the industry.

With mergers still prohibited outside Europe by national ownership laws, the airlines are planning closer integration within the alliance to cut costs. They plan to set up a company based in the US next year to buy aviation fuel collectively, securing discounts.

Star Alliance carriers, which include BMI British Midland, also want to work together in negotiating with aircraft manufacturers such as Airbus, Embraer and Boeing. In a pilot project, four members - Air Canada, Lufthansa, Austrian Airlines and SAS - are jointly negotiating the specifications for a new range of 70 to 110-seat regional jets with aircraft makers, in the hope that by agreeing standard fittings they can secure a cheaper price.

Star Alliance's chief executive, Jaan Albrecht, said he ultimately envisaged joint ownership of aircraft between alliance members.

[Ernest_at_the_Beach]

Thanks for the info. When a plane is on fire, 90 seconds is a long time, I think!

[avg_freeper]

I have pictures of what was left of the wing structure. They were lucky. The aft beam was compromised and the whole wing nearly departed outboard of the engine.

Every time a design engineer complains about by conservatism in my analysis I should show him a picture of that wing.

[avg_freeper]

"by conservatism" => "my conservatism"

[americanbychoice]

One of the problems for us is the government subsidies that puts boeing at a disadvantage.
For years, Airbus sold their planes at no interest. Now they sell thier planes in Dollars, not Euros.

[gcruse]

Hope you got a small desk. It pixellates.

[COEXERJ145]

One of the problems for us is the government subsidies that puts boeing at a disadvantage. For years, Airbus sold their planes at no interest. Now they sell thier planes in Dollars, not Euros.

And they're still selling them cheap as heck because of the same subsidies or as the E.U. calls them, "low interest loans". For some "odd" reason, the loan payments keep getting deferred and the loans are never paid back.

[cmsgop]

WOW! How Scary. Did your buddy have nightmares about it must have been heart wenching to see that.

[cmsgop]

Funny side note . About 3 weeks ago I saw a NW DC-10 take off from Sea-Tac. I thought they phased those out?

[Central Scrutiniser]

They still got a few, they are being phased out too. NW hangs on to its planes for a long time, as they own lots of their planes. They take care of their planes though. The 747-200's and DC-10's are being replaced with A330's and the DC 9's are being replaced with 319/320's. They have a pretty cool new paint job now.

[the invisib1e hand]

Now they sell thier planes in Dollars, not Euros.

semantics (or perhaps smoke and mirrors). they pay their labor and materials in euros, no?

[americanbychoice]

yes, they do. However, they sell their planes in dollars to have a protection against currency fluctuations.

[the invisib1e hand]

that's an after-thought. boeing can sell their planes in euros if they wish, converting them to dollars after the sale, and they still would be cheaper on the world market than the same craft built for euros. airbus can price their craft in dollars if they wish, but it cost them euros to build it, and right now euros are more expensive than dollars. to compete on price, they not only have to narrow their profit margins, they run the risk of sizeable currency loss as well. (I don't know how long losses can be subsidized by a fledgeling superpower...but I know it can't go on forever).

we potentially have a meaningful price advantage in the lower dollar.

[americanbychoice]

i agree. Japan just pulled out of the A380. They are about 180 planes short of breaking even. The Eurinals still believe that they have the moral superiority to stick it to the US>
I do support the low dollar. It will help balance our trade deficit. (with a few exceptions)
Long term the dollar will increase again. A lot of things contribute to the decline, like interest rate differential, etc.
The Eurinals are bankrupt. I hope they won't recover.