Posted on 06/06/2005 10:41:11 PM PDT by Paleo Conservative
SEATTLE -- In the neck-and-neck race for dominance in commercial aircraft, bad news for Airbus is usually good news for The Boeing Co.
The question is how bad and how good.
On Wednesday, when Airbus confirmed that deliveries of its new A380 superjumbo passenger jet will be two to six months late, some analysts called it a hiccup that probably won't hurt the company -- or help its U.S. rival -- that much.
Others wondered if the delay might be a sign of big underlying problems that could threaten the future of the world's largest plane.
"I think the biggest concern of all ... is that this might not be due to flight testing delays or paperwork. It might be due to a need to meet performance specifications. In other words, they might have to be looking at design aspects of this plane,'' said Richard Aboulafia, an aviation analyst with Teal Group in Fairfax, Va.
Airbus spokeswoman Mary Anne Greczyn said delays of this kind are "relatively typical'' with new airplanes.
"A couple of months in the grand scheme of things is really nothing in terms of scheduling,'' Greczyn said.
In late April, Airbus warned Singapore Airlines Ltd. it would receive its A380s late next year instead of in March. Since then, other airlines said they were expecting late deliveries, too.
Airbus has not said what's causing the delays. Australia's Qantas Airways Ltd. said "manufacturing issues'' are to blame.
If those "issues'' mean Airbus is struggling to meet the design specifications it promised airlines, the Toulouse, France-based jet manufacturer could be headed for some serious turbulence.
"It increases the chances that the A380 was oversold in terms of economics and technology, and that is a boon for Boeing and the 747,'' Aboulafia said.
Greczyn scoffed at that suggestion that Airbus might be struggling to keep its promises.
"There is no doubt that we will meet the performance specs we promised our customers,'' she said. "That's not a concern.''
Without discussing exactly what prompted the delay, Greczyn said staying on schedule depends not only on Airbus' production process, but also design requirements from each airline, and a global supply chain.
Boeing's 747, the largest commercial jet in service today, seats about 420 passengers in the standard three-class configuration or 525 in two classes. The A380 will fly 555 passengers in three classes, or a whopping 840 if everyone jams into one class.
Boeing is thinking about building a slightly larger and more fuel-efficient version of the 747. The Chicago-based company, which builds most of its commercial planes in the Seattle area, has said it will decide by the end of the summer whether to offer the 747 Advanced, which would seat about 30 more people than the existing 747.
Peter Jacobs, an analyst with Ragen MacKenzie, said he doesn't see the A380 delay having any impact on Boeing's decision about the 747 Advanced, since that plane probably wouldn't enter service until 2009.
"If there are further delays in the A380 or major problems come up with it during flight testing, it could sway the competitive landscape somewhat, but that's highly unlikely,'' Jacobs said.
In general, Jacobs said he thinks a setback like this one isn't a huge deal — or a surprise.
"When you're breaking new ground, which Airbus is with this large airplane, these kinds of things happen,'' he said.
Scott Hamilton, an aerospace consultant with Leeham Companies LLC, agreed, noting that Boeing was a bit late delivering its first 747-400s in 1989.
"Certainly for the airlines, it's a major inconvenience,'' Hamilton said. "And certainly for Airbus, they're going to have to pay penalties.''
But Hamilton said he doesn't think the delay will cost Airbus any customer loyalty.
"The airlines that have already ordered the A380 are almost certainly going to stick with the A380 unless something humongous happens to the program.''
Shares in European Aeronautic Defence and Space Co., which owns 80 percent of Airbus fell as much as 2.2 percent in early trading before recovering to close just 0.3 percent lower at 23.97 euros ($29.31). BAE Systems, which owns the remaining 20 percent of Airbus, closed 1.5 percent higher at 2.73 pounds ($4.97) in London.
Boeing shares fell 10 cents Wednesday to close at $63.80 on the New York Stock Exchange.
Too late!
I see Airbus is going to make a plane to compete with the 787. Which is funny because they said they already had models to compete when Boeing launched it!
There is at least one member who posts some pretty informative articles in these threads sometimes (Central Scrutinizer?).
As for myself, I like for people and companies to dream big. While I am not the biggest fan of Airbus, I do want to see large projects succeed, in general. I believe this beast will eventually fly and be minimally profitable for Airbus, not that profitability matters much to them..
It was used to flight test the PW and RR engines for the 777, and it has been used by Boeing for flight testing various other equipemnt.
I don't think the ones used for fatigue tests ever were fitted out with a flight deck or interior. There's one test where they measure how much force it takes to break the wings, and another one where they put the fuselage in a water tank and simulate tens or hundreds of thousands of pressurization cycles till the hull fails due to metal fatigue.
Wrong, all the planes built will go into service, there is no prototype. The second will not be broken into pieces. I don't know where you get your information from, but its not from any knowledge of airplanes.
Airbus will be doing flight testing on the first 5 planes, they are all the same, no prototype. 2500 hours of flights, with one plane engined with GE/PW GP7200 engines, and the others with the Rolls Royce Trent 900 engines.
First plane goes to Singapore airlines, and will be in service in the last quarter of 2006. Good article about the first flight and testing program in this month's Air Transport World.
As for the name calling of Airbus, pretty childish.
The first 777 ever built is still flying for its original customer, United Airlines.
Thanks for the ping, the bias here is silly and misinformed. Its OK to bag on the French, but to carry it to an airplane that is built by a consortium of countries and carries a hell of a lot of American built parts is stupid.
Airbus makes good planes, Boeing makes good planes, Embraer makes good planes, they all compete and make each other better. My airline is going to be the launch customer of the A350, should be fun.
The A380 is a niche plane, they aren't being built to service every route in the world, just medium long range high density routes. The plane is being built primarily for the needs of Asian carriers that operate from slot controlled airports and for Middle Eastern carriers that can afford to outfit their cabins with extravagance that their customers will pay for. And it will be a hell of a good cargo plane. The A380 may not make a profit for a while, but hats off to Airbus for pushing the envelope and building it. Airbus makes its dough from the A318/319/320/330/340 aircraft.
Hopefully Boeing will win out..
If Boeing pulled this crap, they would get the same reaction. They need to realize the 777 and 787 are damn good planes that are superior to most of their offerings for the markets that these airlines are buying for right now, that's why they are getting their asses handed to them lately.
That's not the concern, Mary Anne. It's "when". Customers want their planes with the performance promised in a reasonable amount of time.
If the A380 development was funded with private money and provided competition for Boeing, I would not criticize it. I would still favor Boeing, because in my opinion the development of the 747 is one of the greatest capitalism success stories.
Instead, the A380 development was subsidized with a seemingly bottomless pocket of public funds, with the goal of putting Boeing out of business.
I am all for competition - it creates better, cheaper products. My dislike of the A380 has nothing to do with product quality.
Ahhhh, guess what? I get my information from having been in the industry and subscribing to the trade journals and magazines!
You are a buffoon.
Boeing gets its share of government cheese, don't be naive.
I speak from experience, I know a bit about planes. You just know how to make really stupid names for Airbus.
Stick to whatever it is that you know and comment on that.
The new Smithsonian Air and Space Annex at Dulles has the prototype 707 on display, its gone through all kinds of mods since day one, it looks great. They also have a Concorde and the only remaining Stratoliner.
Wish they had the surviving XB-70 on display, but its at Wright Patterson.
I wonder why Boeing didn't get more market share with the 247 and Stratoliner? It seems like until the 707, Boeing was always the underdog when competing for comercial airliners. Weren't the Stratoliners mostly used for transporting generals and other VIP's across the Atlantic during WWII?
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.