musman9853
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Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 4:45 pm

https://www.flightglobal.com/news/artic ... pe-457443/

pretty interesting article. according to BA's ceo the a380 wasn't even close to being competitive with the 777x. a big factor was interior mods would have taken 50 million a plane, which at that point makes it better just to buy new and more efficient.
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Vladex
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 4:58 pm

He may or may not be right but whose airplanes would he take ?
BA is not really taking care of A380 anyway so why do would they bother taking more of them?
See for your self.
https://www.youtube.com/watch?v=YKLGq9GUSa4
https://www.youtube.com/watch?v=DNbBhQg-qv8
 
giblets
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 5:09 pm

"There has been a strong desire at BA to acquire more A380s, but with production set to end by 2021 the used market is the only source now. "If we were to find some formula in which we could take more, we would. We haven't been able to do so," says Cruz."

From the article linked above, essentially it's still not out of the question. Think Malaysia, Singapore, Thai (Trent users), then its down to price.
The airbus offer was new AND used. So they might consider used at some time, just need the right deal.


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IslandRob
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 5:18 pm

musman9853 wrote:
https://www.flightglobal.com/news/articles/package-of-newused-a380s-pitched-to-ba-was-uncompe-457443/

pretty interesting article. according to BA's ceo the a380 wasn't even close to being competitive with the 777x. a big factor was interior mods would have taken 50 million a plane, which at that point makes it better just to buy new and more efficient.


I think this pretty much extinguishes the hope that BA will add A380s, new or used. Alex Cruz could not be more clear:

"Imagine that we find a suitable used, relatively new A380 whose owners don't want any more – think Malaysian, think Emirates, think Lufthansa," says Cruz. "Imagine they give it to us at a really reasonable price. Everything breaks down the moment you start thinking about the inside of the aircraft."

Cruz says the cost to reconfigure the cabin "can run to between $30-50 million" per aircraft. "To put that into a lease rate, all of a sudden it takes the aircraft completely out of the market."


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speedbird52
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 5:27 pm

Vladex wrote:
He may or may not be right but whose airplanes would he take ?
BA is not really taking care of A380 anyway so why do would they bother taking more of them?
See for your self.
https://www.youtube.com/watch?v=YKLGq9GUSa4
https://www.youtube.com/watch?v=DNbBhQg-qv8

Not sure if the club world review is up to date. I most certainly did have three choices of starter in Club World flying form Heathrow to Seattle four days ago. The food was also very good, despite not being Do&Co. The only complaints I have were that the cabin lights were not switched off until five hours into the flight, (And only after I asked the flight attendant...) and that bedding is not provided on such a long flight.
 
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 5:36 pm

Interior mod prices for the A380 are being exagerated.
It should be the same pro rata as any other airliner, airlines have just been using this as an excuse.
The fact is that BA is doing fine for now, but they are setup for a dwindling future.
LHR will progressively lose relevance as other London airports grow, and point to point options bypass hubs such as LHR.

By letting the A380 die, BA is going against its core business model centered around the LHR mega hub. Point to point from a mega hub is not a strategy, it's an invitation to be overwhelmed by competition.
The B777X can fulfill the same role as the B744 and do it slightly better.
But the A380 could have offered BA much much more.

Going for B777X over A380 was a strategic mistake for BA, while Airbus should have done more to get BA to commit to the A380.
Lose-lose. Only Boeing won.

We'll see.
That BA is losing relevance in all its markets, from Asia to TATL and the Kangaroo route is a certainty. Short-term profits, long-term disaster.
 
tomcat
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 5:40 pm

"There has been a strong desire at BA to acquire more A380s"

Obviously, not that strong, otherwise they would have acquired more factory-fresh A380s. It seems to me that they like the idea of operating super-jumbos but not the investment they require. How can one name this a "strong desire"?
 
9Patch
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 5:50 pm

Waterbomber2 wrote:
Point to point from a mega hub is not a strategy, it's an invitation to be overwhelmed by competition.

Because passengers, especially premium business passengers, don't want to fly non-stop. They really prefer changing planes and adding an extra two or three hours, plus the possibility of delays and cancellations, to their busy schedule. :sarcastic: Who says time is money?
 
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 6:14 pm

Alex Cruz wrote:
"Imagine they give it to us at a really reasonable price. Everything breaks down the moment you start thinking about the inside of the aircraft."


So if the re config of an A380 is so cost prohibitive, aren’t they going to fit the new Club World seats on them?
And the “allegedly” new First coming up later this year?

This upcoming change in premium classes should be an advantage to bring in new/ish frames as they have to invest the money anyway for the new seats on the current fleet...
 
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 6:52 pm

Waterbomber2 wrote:
Interior mod prices for the A380 are being exagerated.
It should be the same pro rata as any other airliner, airlines have just been using this as an excuse.
The fact is that BA is doing fine for now, but they are setup for a dwindling future.
LHR will progressively lose relevance as other London airports grow, and point to point options bypass hubs such as LHR.

By letting the A380 die, BA is going against its core business model centered around the LHR mega hub. Point to point from a mega hub is not a strategy, it's an invitation to be overwhelmed by competition.
The B777X can fulfill the same role as the B744 and do it slightly better.
But the A380 could have offered BA much much more.

Going for B777X over A380 was a strategic mistake for BA, while Airbus should have done more to get BA to commit to the A380.
Lose-lose. Only Boeing won.

We'll see.
That BA is losing relevance in all its markets, from Asia to TATL and the Kangaroo route is a certainty. Short-term profits, long-term disaster.


Sorry in what way is BA losing relevance in the TATL market...
 
jagraham
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 6:57 pm

Whether you're buying a new or used plane, you have to buy the seats. And the IFE. Maybe the galley(s). So it should not have been that much difference except for the number of seats (with an A380, there's about 100 more seats to deal with).
The 779 will be much cheaper than an A380, more than 1/3 less trip costs. But A380s will make money on routes that need the capacity. Of which BA has several. So unless they plan to cut capacity on heavily traveled routes, the seats should not have made that much difference. We are not hearing the whole story.
 
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 7:19 pm

Waterbomber2 wrote:
Interior mod prices for the A380 are being exagerated.
It should be the same pro rata as any other airliner, airlines have just been using this as an excuse.
The fact is that BA is doing fine for now, but they are setup for a dwindling future.
LHR will progressively lose relevance as other London airports grow, and point to point options bypass hubs such as LHR.


That just about every airline that has taken A380s haven't added to their orders and many are winding down their fleet early says more about the A380 than it does the airlines. It's a dog of a plane - limited in where it actually works and arguably have 2 or 3 too many - and a fleet size of 9 or 10 just doesn't make much sense.

As for LHR losing relevancy...huh?! Gatwick is just about full in summer peak months, Stansted will nevrr rival LGW or LHR and Luton simply can't handle much of a widebody operation. LHR will remain London's main and premier gateway, 3rd runway or not.

Waterbomber2 wrote:
By letting the A380 die, BA is going against its core business model centered around the LHR mega hub. Point to point from a mega hub is not a strategy, it's an invitation to be overwhelmed by competition.
The B777X can fulfill the same role as the B744 and do it slightly better.
But the A380 could have offered BA much much more.


Connections have never been big business for BA compared to the likes of KLM at Amsterdam. BA has a higher proportion of O&D passengers compared to connections of any other major European network carrier. BA's scale, network reach and LHR slot portfolio means it will always have the edge in its core Atlantic market. Its costs are now competitive to the point where on short haul it can go head to head with easyJet and still turn a profit. You can see how its response to Norwegian has worked - AUS now on the 747 and A380 to Chicago has made it difficult for Norwegian to the point where they are now only seasonal. FLL from Gatwick has worked so well Norwegian has moved to Miami in search of higher yields. BA is overwhelming the competition, not vice versa.

As said.above, besides JNB, HKG, SIN and perhaps LAX, the A380 just doesn't work anywhere else where frequency is king.

Waterbomber2 wrote:
Going for B777X over A380 was a strategic mistake for BA, while Airbus should have done more to get BA to commit to the A380.
Lose-lose. Only Boeing won.


I completely disagree. There's no 2nd hand market for the A380 - it simply doesn't work to most destinations for variety of reasons and the 777X allows huge flexibility and versatility, something the A380 sorely lacks.

Waterbomber2 wrote:
We'll see.
That BA is losing relevance in all its markets, from Asia to TATL and the Kangaroo route is a certainty. Short-term profits, long-term disaster.


I have no idea what you're talking about. It's the strongest player in the Transatlantic market from the UK - growing in capacity and destinations served every year. KIX shows BA can carve out a niche in Asia too - the UK's geography simply doesn't lend itself to be a strong player the the Europe-Asia market. Kangaroo route yields have been trashed by the ME3's over capacity, BA is holding its own well on the LHR-SIN-SYD route.

BA is well equiped to make long term profits - the mix of 787s, 777X and A350s plus A320neos, an expanded LGW slot portfolio to exploit, competitive cost base and improving products shows BA will be a top player for years to come. Shunning more A380s may well prove to be one of its most shrewd decisions.
 
musman9853
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 7:27 pm

BA777FO wrote:

Waterbomber2 wrote:
We'll see.
That BA is losing relevance in all its markets, from Asia to TATL and the Kangaroo route is a certainty. Short-term profits, long-term disaster.


I have no idea what you're talking about. It's the strongest player in the Transatlantic market from the UK - growing in capacity and destinations served every year. KIX shows BA can carve out a niche in Asia too - the UK's geography simply doesn't lend itself to be a strong player the the Europe-Asia market. Kangaroo route yields have been trashed by the ME3's over capacity, BA is holding its own well on the LHR-SIN-SYD route.

BA is well equiped to make long term profits - the mix of 787s, 777X and A350s plus A320neos, an expanded LGW slot portfolio to exploit, competitive cost base and improving products shows BA will be a top player for years to come. Shunning more A380s may well prove to be one of its most shrewd decisions.


yeah, idk what he's talking about. especially considering the rumors american is gonna stop serving jfk-lhr on their own metal in favor of BA's jets. BA owns the jfk-lhr route.
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 7:39 pm

Waterbomber2 wrote:
Interior mod prices for the A380 are being exagerated.
It should be the same pro rata as any other airliner, airlines have just been using this as an excuse.
The fact is that BA is doing fine for now, but they are setup for a dwindling future.
LHR will progressively lose relevance as other London airports grow, and point to point options bypass hubs such as LHR.

By letting the A380 die, BA is going against its core business model centered around the LHR mega hub. Point to point from a mega hub is not a strategy, it's an invitation to be overwhelmed by competition.
The B777X can fulfill the same role as the B744 and do it slightly better.
But the A380 could have offered BA much much more.

Going for B777X over A380 was a strategic mistake for BA, while Airbus should have done more to get BA to commit to the A380.
Lose-lose. Only Boeing won.

We'll see.
That BA is losing relevance in all its markets, from Asia to TATL and the Kangaroo route is a certainty. Short-term profits, long-term disaster.


This entire post is rubbish. The 380's are expensive to operate, even more so to buy used and retrofit. The 777X will perform the same mission, much more efficiently.
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 8:09 pm

Waterbomber2 wrote:
That BA is losing relevance in all its markets, from Asia to TATL and the Kangaroo route is a certainty. Short-term profits, long-term disaster.


:rotfl:

This is straight up horse manure. BA is losing relevance in the TATL market? Really?
2019: SIN HKG NRT DFW IAH HOU CLT LGA JFK SFO SJC EWR SNA EYW MIA BOG LAX ORD DTW OAK PVG BOS DCA IAD ATL LAS BIS CUN PHX OAK SYD MEL DEN BLR MAA DEL KTM YYZ MEX
 
Waterbomber2
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 8:29 pm

BA777FO wrote:
Waterbomber2 wrote:
Interior mod prices for the A380 are being exagerated.
It should be the same pro rata as any other airliner, airlines have just been using this as an excuse.
The fact is that BA is doing fine for now, but they are setup for a dwindling future.
LHR will progressively lose relevance as other London airports grow, and point to point options bypass hubs such as LHR.


That just about every airline that has taken A380s haven't added to their orders and many are winding down their fleet early says more about the A380 than it does the airlines. It's a dog of a plane - limited in where it actually works and arguably have 2 or 3 too many - and a fleet size of 9 or 10 just doesn't make much sense.

As for LHR losing relevancy...huh?! Gatwick is just about full in summer peak months, Stansted will nevrr rival LGW or LHR and Luton simply can't handle much of a widebody operation. LHR will remain London's main and premier gateway, 3rd runway or not.

Waterbomber2 wrote:
By letting the A380 die, BA is going against its core business model centered around the LHR mega hub. Point to point from a mega hub is not a strategy, it's an invitation to be overwhelmed by competition.
The B777X can fulfill the same role as the B744 and do it slightly better.
But the A380 could have offered BA much much more.


Connections have never been big business for BA compared to the likes of KLM at Amsterdam. BA has a higher proportion of O&D passengers compared to connections of any other major European network carrier. BA's scale, network reach and LHR slot portfolio means it will always have the edge in its core Atlantic market. Its costs are now competitive to the point where on short haul it can go head to head with easyJet and still turn a profit. You can see how its response to Norwegian has worked - AUS now on the 747 and A380 to Chicago has made it difficult for Norwegian to the point where they are now only seasonal. FLL from Gatwick has worked so well Norwegian has moved to Miami in search of higher yields. BA is overwhelming the competition, not vice versa.

As said.above, besides JNB, HKG, SIN and perhaps LAX, the A380 just doesn't work anywhere else where frequency is king.

Waterbomber2 wrote:
Going for B777X over A380 was a strategic mistake for BA, while Airbus should have done more to get BA to commit to the A380.
Lose-lose. Only Boeing won.


I completely disagree. There's no 2nd hand market for the A380 - it simply doesn't work to most destinations for variety of reasons and the 777X allows huge flexibility and versatility, something the A380 sorely lacks.

Waterbomber2 wrote:
We'll see.
That BA is losing relevance in all its markets, from Asia to TATL and the Kangaroo route is a certainty. Short-term profits, long-term disaster.


I have no idea what you're talking about. It's the strongest player in the Transatlantic market from the UK - growing in capacity and destinations served every year. KIX shows BA can carve out a niche in Asia too - the UK's geography simply doesn't lend itself to be a strong player the the Europe-Asia market. Kangaroo route yields have been trashed by the ME3's over capacity, BA is holding its own well on the LHR-SIN-SYD route.

BA is well equiped to make long term profits - the mix of 787s, 777X and A350s plus A320neos, an expanded LGW slot portfolio to exploit, competitive cost base and improving products shows BA will be a top player for years to come. Shunning more A380s may well prove to be one of its most shrewd decisions.


That there is no second hand market for the A380 plays in favor of an operator that flies its frames all the way to the scrap yard.
How? New frames are cheaper to aquire, used frames are cheaper to acquire.

BA is well equipped for future downsizing, which is what they are already doing.
A few more airframes but smaller average frame size.
That is literally called downsizing.

BA's presence IN Asia has gone from co-dominant to passive at best. Japan, China and India? Meh, just dots on a map.

JFK-LHR is doing great. But look what they have on the route now. The queen of the skies is bringing home the profits.

There is no reason to think that the similar-sized B777X won't do the same, or is there? How does a paid-off B744 stack against a 200 mill shiny new B777X?
Can the lower fuel and maintenance bills of the B777X offset the higher capital cost in a low utilization operation such as Jfk-lhr where more time is spent on the ground parked or taxiing than flying?

The industry proverb "if it ain't flying, it ain't earning" reminds us that capital costs are very high in this business.
Every minute that a B777X will spend on the ground will cost BA over 30 pounds in lease costs alone.
If you have 30 of them in a fleet, that's about 1000 pounds every minute that they are on the ground.
Food for thought.

At the end of the day, there won't be much difference between the B744 and the B777X, cost wise.
And there lies the problem imo.
You don't spend billions on a new subfleet for a status-quo, when you can expand an existing A380 fleet with commonality, savings of scale, a better product, while increasing capacity and dominance on your core market.

Clearly a missed opportunity.
 
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 8:47 pm

Aisak wrote:
Alex Cruz wrote:
"Imagine they give it to us at a really reasonable price. Everything breaks down the moment you start thinking about the inside of the aircraft."


So if the re config of an A380 is so cost prohibitive, aren’t they going to fit the new Club World seats on them?
And the “allegedly” new First coming up later this year?

This upcoming change in premium classes should be an advantage to bring in new/ish frames as they have to invest the money anyway for the new seats on the current fleet...

New club world and first is just changing seats. Brining used aircraft to BA standards likely involve galley, plumbing, and wiring changes. That means a lot more money.

High conversion costs are the downside of allowing extensive customization as Airbus did early on with the A380. This is why both Airbus and Boeing have moved on to less customer specific customization and more standardization than they use to do in the past (especially Boeing). Standardization makes reselling aircraft much easier.
 
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 8:53 pm

The only A380 operator that ever wanted more than their original order was EK. And I believe even they came to realize that they had too many of them; I think they went to Airbus and said that since it was clear that they weren’t getting any engine improvements from RR that they wanted out of all of the orders that they could. And the reason is clear; there are now 4 smaller planes on the market that offer equal or better economics; the 787, the A350, the 779 and the A330neo. The idea that an airline “needs” to fly a bigger plane if there are more passengers than they can carry is hogwash, even at slot-constrained airports. If smaller planes are more economical, just add frequency. If slots are full, nobody else can haul them either, so you raise fares. The big plane will not make you more money unless you are sure it will be full 100% of the time. And even then, maybe not. One airline exec said it was cheaper to fly 2 787s than 1 A380. And I believe the 2 787s will carry more passengers and a LOT more freight. And that is why the A380 has a big fork in it.
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Vladex
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 9:10 pm

Airbus hopes you are right, nothing out there can compete with A321 NEO
 
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 9:13 pm

Why no mention from Airbus about any A350-1000's ? While the RFP was for 777 and 744 replacements that had to include planes beyond the A380, if BA did order any it would be 6, 8 maybe 10 at most. A follow on order for A350 would have been for more than the quantity of A380's.
 
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 9:17 pm

I think the point being missed about the cost of interiors is there needs to be significant reconfiguration before a BA interior can be fitted


It's not a clean shell. Galley positions and toilet positions vary between airlines but any used 380s joining what is already a.modest fleet of 12 would need to have identical interior configuration to avoid unnecessary complexity. Then you first a new interior.
 
amc737
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 9:22 pm

To be fair this is not unique to the A380 although no doubt it is very expensive to re-configure - most traditional long haul operators do not buy second hand long haul airliners. British Airways have no history of doing this, yes some leasing of 747-100s back in the day but the 747-200 and 400 fleet grew by new builds, likewise the 777s. There had been rumours of 2nd hand 777-300ERs from TAM, in the end more new builds are coming. If you look at most other European operators it’s the same, Air France, KLM and Lufthansa’s fleet are all new builds. There are exceptions to the rule, Alitalia have, Qantas bought 2nd hand 747’s in the 90s and the gulf carriers have bought used wide bodies. The costs of re-configuration are a deterrence but also the fact in this day and age you can’t get away with offering a completely different long hual product if you don’t refurb. Just changing the seat covers won’t cut it - look how up front BA have been with the A340 lease, specifying which routes it will operate and dates etc along with commercial polices because the product is different to the usual BA one.

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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 9:29 pm

Waterbomber2 wrote:
Interior mod prices for the A380 are being exagerated.
It should be the same pro rata as any other airliner, airlines have just been using this as an excuse.

The upper price range quoted is high end, and not comparable to how BA currently configures it's A380's.

And something is missing in the equation, because the outgoing leasee (lessee) will have an end of lease (EOL) payment in respect to refurbishing the interior (and exterior) to as new condition, unless they themselves leased a bare interior aircraft (in which case they have to return it to that 'as new' state).

More likely, the issue is operating costs. For example, EK takes out a fixed price maintenance contract with RR for the life of the lease plus 2 years, covering lease rollover, adhoc use post lease, etc. Given RR isn't keen to sell new engines, not difficult to imagine how competitively (not) maintenance contract pricing is for used engines off contract, or free-styled from new.
 
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 10:36 pm

musman9853 wrote:
https://www.flightglobal.com/news/articles/package-of-newused-a380s-pitched-to-ba-was-uncompe-457443/

pretty interesting article. according to BA's ceo the a380 wasn't even close to being competitive with the 777x. a big factor was interior mods would have taken 50 million a plane, which at that point makes it better just to buy new and more efficient.

To be fair he quoted the range 30-50M, but one can imagine the high end, because Airbus gave each airline a lot of license to set up the cabin any way they wanted, which makes it darn hard to get used frames new homes. Airbus had the rosiest of rose colored glasses on back when they launched the A380.

giblets wrote:
"There has been a strong desire at BA to acquire more A380s, but with production set to end by 2021 the used market is the only source now. "If we were to find some formula in which we could take more, we would. We haven't been able to do so," says Cruz."

From the article linked above, essentially it's still not out of the question. Think Malaysia, Singapore, Thai (Trent users), then its down to price.
The airbus offer was new AND used. So they might consider used at some time, just need the right deal.

Hope springs eternal, so it seems.

Waterbomber2 wrote:
Interior mod prices for the A380 are being exagerated.
It should be the same pro rata as any other airliner, airlines have just been using this as an excuse.

AF is raising the same issues, but still going forward and upgrading a few frames, which I think undermines your statement about excuses.

Waterbomber2 wrote:
The B777X can fulfill the same role as the B744 and do it slightly better.
But the A380 could have offered BA much much more.

Going for B777X over A380 was a strategic mistake for BA, while Airbus should have done more to get BA to commit to the A380.

The 777x can and will offer BA so much more than the ageing, over-built A380s do.

tomcat wrote:
"There has been a strong desire at BA to acquire more A380s"

Obviously, not that strong, otherwise they would have acquired more factory-fresh A380s. It seems to me that they like the idea of operating super-jumbos but not the investment they require. How can one name this a "strong desire"?

There was a strong desire to get a lower price from Boeing on the 777x order, and it appears the tactic of using the A380 as a staking horse worked.

So many posts in this thread are focused on the A380 and its characteristics, seemingly not considering the business was very important to Boeing and its 777x product line, and that BA knew it.

The fact that the A380 has end-of-life engines and an oversized wing also made the 777x with its state of the art engines and wings look pretty good in comparison.

Sure, sooner or later the pax lose the ability to hob-nob in the upper deck, but EK will lose that sooner or later too.
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 10:50 pm

tomcat wrote:
"There has been a strong desire at BA to acquire more A380s"

Obviously, not that strong, otherwise they would have acquired more factory-fresh A380s. It seems to me that they like the idea of operating super-jumbos but not the investment they require. How can one name this a "strong desire"?


Precisely. I'm reading this now as I read it when BA first voiced an interest in more A380 fleet. Did they expect Airbus to cabin convert them too or Viber those costs for them ?
 
Arion640
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 11:05 pm

Waterbomber2 wrote:
Interior mod prices for the A380 are being exagerated.
It should be the same pro rata as any other airliner, airlines have just been using this as an excuse.
The fact is that BA is doing fine for now, but they are setup for a dwindling future.
LHR will progressively lose relevance as other London airports grow, and point to point options bypass hubs such as LHR.

By letting the A380 die, BA is going against its core business model centered around the LHR mega hub. Point to point from a mega hub is not a strategy, it's an invitation to be overwhelmed by competition.
The B777X can fulfill the same role as the B744 and do it slightly better.
But the A380 could have offered BA much much more.

Going for B777X over A380 was a strategic mistake for BA, while Airbus should have done more to get BA to commit to the A380.
Lose-lose. Only Boeing won.

We'll see.
That BA is losing relevance in all its markets, from Asia to TATL and the Kangaroo route is a certainty. Short-term profits, long-term disaster.


I agree about the cost of interior mods. BA are going to refit the A380 with some form of club suite and new first anyway - at cost.

It’s all a bit contradictory but because he’s said there is (was) a desire to acquire more A380’s he clearly see’s the fleet continuing into the future. I even had someone tell me when I was down in BA HQ last month, the A380 doesn’t really save much money as it somewhat trashes yields but is a great way to save slots at Heathrow.

But I disagree with your point about TATL. BA’s NYLON is the highest revenue earning route in the world. They are running the show.

But the bottom line is, Boeing clearly offered the better deal and won this one. But if 4-6 good frames come along in the next 5 years from SQ or EK, I wouldn’t be surprised to see BA take them.
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 11:22 pm

9Patch wrote:
Waterbomber2 wrote:
Point to point from a mega hub is not a strategy, it's an invitation to be overwhelmed by competition.

Because passengers, especially premium business passengers, don't want to fly non-stop. They really prefer changing planes and adding an extra two or three hours, plus the possibility of delays and cancellations, to their busy schedule. :sarcastic: Who says time is money?


Although, I suspect with the increasing discomfort in economy class business travelers whose employers won't pony up the cash to pay for business class may actually like to break up the flights... but that's only because flying is getting too damn uncomfortable, not because travelers love adding hours to their travel times.
 
9Patch
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 11:43 pm

Jouhou wrote:
Although, I suspect with the increasing discomfort in economy class business travelers whose employers won't pony up the cash to pay for business class may actually like to break up the flights... but that's only because flying is getting too damn uncomfortable, not because travelers love adding hours to their travel times.


All the more reason to get it over with fast. Just get me to my destination!
I'm willing to pay extra for a non-stop and I'm sure I'm not alone.
 
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Jouhou
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 11:49 pm

9Patch wrote:
Jouhou wrote:
Although, I suspect with the increasing discomfort in economy class business travelers whose employers won't pony up the cash to pay for business class may actually like to break up the flights... but that's only because flying is getting too damn uncomfortable, not because travelers love adding hours to their travel times.


All the more reason to get it over with fast. Just get me to my destination!
I'm willing to pay extra for a non-stop and I'm sure I'm not alone.


Me too but I actually will cough up extra money (and I'm not rich) to fly business class for flights longer than 8 hours. Economy becomes intolerable at that length of flight.
 
9Patch
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sat Apr 13, 2019 11:57 pm

Jouhou wrote:
Me too but I actually will cough up extra money (and I'm not rich) to fly business class for flights longer than 8 hours. Economy becomes intolerable at that length of flight.

I won't pay $5000 for business class, but I might spring for Economy Plus depending on what's offered and for what price. I seldom go anywhere that's longer than six hours.
 
airlineworker
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sun Apr 14, 2019 3:18 am

Waterbomber2 wrote:
Interior mod prices for the A380 are being exagerated.
It should be the same pro rata as any other airliner, airlines have just been using this as an excuse.
The fact is that BA is doing fine for now, but they are setup for a dwindling future.
LHR will progressively lose relevance as other London airports grow, and point to point options bypass hubs such as LHR.

By letting the A380 die, BA is going against its core business model centered around the LHR mega hub. Point to point from a mega hub is not a strategy, it's an invitation to be overwhelmed by competition.
The B777X can fulfill the same role as the B744 and do it slightly better.
But the A380 could have offered BA much much more.

Going for B777X over A380 was a strategic mistake for BA, while Airbus should have done more to get BA to commit to the A380.
Lose-lose. Only Boeing won.

We'll see.
That BA is losing relevance in all its markets, from Asia to TATL and the Kangaroo route is a certainty. Short-term profits, long-term disaster.


When the A380 was dropped from the Airbus sales catalog, it lost any appeal it may have had. Discontinued models are not attractive to airlines who think many years down the road with regard to parts,parts availability and parts prices. The 777X can service more routes than the A380 and can weather downturns in air travel better due to reduced loads needed to be profitable.
 
Aither
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sun Apr 14, 2019 4:20 am

No A380 and no more frequencies will mean more capacity and pricing pressure from competition. There is a strong value to be the dominant player on a market. The 100 additional seats of the A380 are used to kick off anybody trying to get your key O&D markets.
Never trust the obvious
 
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ElroyJetson
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sun Apr 14, 2019 4:53 am

The A380 is an inefficient fuel guzzling dinosaur. This is particularly true with the advent of the 787, A350, and the 777X.

There is simply no solid business case for the A380 anymore. Folks, please, just let it go. Much like the 747 it's day has passed.
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Arion640
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sun Apr 14, 2019 5:22 am

9Patch wrote:
Jouhou wrote:
Although, I suspect with the increasing discomfort in economy class business travelers whose employers won't pony up the cash to pay for business class may actually like to break up the flights... but that's only because flying is getting too damn uncomfortable, not because travelers love adding hours to their travel times.


All the more reason to get it over with fast. Just get me to my destination!
I'm willing to pay extra for a non-stop and I'm sure I'm not alone.


It will depend if it’s in Y or Business. I much prefer a stop anyday if flying over 6 or 7 hours in Y.
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vhtje
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sun Apr 14, 2019 5:32 am

Waterbomber2 wrote:
Interior mod prices for the A380 are being exagerated.
It should be the same pro rata as any other airliner, airlines have just been using this as an excuse.
The fact is that BA is doing fine for now, but they are setup for a dwindling future.
LHR will progressively lose relevance as other London airports grow, and point to point options bypass hubs such as LHR.

By letting the A380 die, BA is going against its core business model centered around the LHR mega hub. Point to point from a mega hub is not a strategy, it's an invitation to be overwhelmed by competition.
The B777X can fulfill the same role as the B744 and do it slightly better.
But the A380 could have offered BA much much more.

Going for B777X over A380 was a strategic mistake for BA, while Airbus should have done more to get BA to commit to the A380.
Lose-lose. Only Boeing won.

We'll see.
That BA is losing relevance in all its markets, from Asia to TATL and the Kangaroo route is a certainty. Short-term profits, long-term disaster.


You’re forgetting TATL O&D. BA makes a LOT of money connecting rich London businesspeople with their American colleagues and customers. It also makes a fair chunk taking Brits on American holidays. Why do you think BA keeps expanding into new US markets with the 787? Losing relevance? Hardly.
I only turn left when boarding aircraft. Well, mostly. All right, sometimes. OH OKAY - rarely.
 
BAWLGW
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sun Apr 14, 2019 8:03 am

If the production of the rumoured 777-10 is true, my guess is that the BA A380 operation will be drawing to a close in 2025. With the airline ordering 777-10 to replace the A380. Fleet commonality is something BA wants/needs.

In my view the future fleet will comprise off:
A320neo
A321neo
A350-1000
787-8, 9 & 10
777-300ER, 9 & 10
 
JayinKitsap
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sun Apr 14, 2019 8:09 am

ElroyJetson wrote:
The A380 is an inefficient fuel guzzling dinosaur. This is particularly true with the advent of the 787, A350, and the 777X.

There is simply no solid business case for the A380 anymore. Folks, please, just let it go. Much like the 747 it's day has passed.


Yes, Cruz was asked about why no 380's and he was frank. At the same time when any RR equipped 380s come on the market there will be a number of calls to his office trying to sell or lease to BA. How Cruz said it basically stated - no more 380's at BA, the dozen in the fleet is enough.
 
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sun Apr 14, 2019 8:52 am

musman9853 wrote:
https://www.flightglobal.com/news/articles/package-of-newused-a380s-pitched-to-ba-was-uncompe-457443/

pretty interesting article. according to BA's ceo the a380 wasn't even close to being competitive with the 777x. a big factor was interior mods would have taken 50 million a plane, which at that point makes it better just to buy new and more efficient.


So they like the A380 itself but the cost of changing the interior on such a large double decker plane is what makes the difference.
 
ltbewr
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sun Apr 14, 2019 8:55 am

Too many seats in coach means lower profits. There is only so much demand for premium seats, including 'premium economy'. If a A380 or even a B747 vs.a large B777 means fewer coach seats, profits from each flight are higher due to lower fuel and mx costs per seat mile and not having to sell cheap the price sensitive coach seats. With a likely major economic recession in the next 2 years, who knows about the affects of Brexit, oil prices going up at some point, it will mean a decline in overall demand for seats and an A380 will have too many on some routes.
 
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lollyj
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sun Apr 14, 2019 9:23 am

Vladex wrote:
He may or may not be right but whose airplanes would he take ?
BA is not really taking care of A380 anyway so why do would they bother taking more of them?
See for your self.
https://www.youtube.com/watch?v=YKLGq9GUSa4
https://www.youtube.com/watch?v=DNbBhQg-qv8


I mean, BA haven't been the best at keeping up to date with their hard and soft product but they've been rolling out improvements throughout their cabins: https://onemileatatime.com/british-airw ... rovements/ for WT+ and CW: https://www.godsavethepoints.com/2018/0 ... l-service/ and the newly announced CW suite shows that they are starting to take their product seriously again which is great news.

Also, might want to check the upload dates of those two trip reports, the first one is almost 3 years old and the second one is 2 years old...
 
Armodeen
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sun Apr 14, 2019 9:39 am

When we are talking about SQ, EK et al you are really talking about bringing the aircraft down to BA standards. Their A380 config is really poor compared to most carriers. Still, shame they won’t be getting more, it seems like an idea they flirted with more than we’re really serious about.

Btw I don’t really get how the 779 will be massively more flexible, it is itself a very large aircraft.



Polot wrote:
Aisak wrote:
Alex Cruz wrote:
"Imagine they give it to us at a really reasonable price. Everything breaks down the moment you start thinking about the inside of the aircraft."


So if the re config of an A380 is so cost prohibitive, aren’t they going to fit the new Club World seats on them?
And the “allegedly” new First coming up later this year?

This upcoming change in premium classes should be an advantage to bring in new/ish frames as they have to invest the money anyway for the new seats on the current fleet...

New club world and first is just changing seats. Brining used aircraft to BA standards likely involve galley, plumbing, and wiring changes. That means a lot more money.

High conversion costs are the downside of allowing extensive customization as Airbus did early on with the A380. This is why both Airbus and Boeing have moved on to less customer specific customization and more standardization than they use to do in the past (especially Boeing). Standardization makes reselling aircraft much easier.
 
uta999
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sun Apr 14, 2019 9:43 am

Why waste $50 million refitting a used A380? Most passengers wouldn’t even notice the difference. Just buy some from one airline and put them into service, with new headrest covers and a fresh coat of paint on the outside.

They could just be a sub-fleet for use on US East Coast services.
Your computer just got better
 
mutu
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sun Apr 14, 2019 9:55 am

uta999 wrote:
Why waste $50 million refitting a used A380? Most passengers wouldn’t even notice the difference. Just buy some from one airline and put them into service, with new headrest covers and a fresh coat of paint on the outside.

They could just be a sub-fleet for use on US East Coast services.

I am sure this is a sarcastic post. But if not there is no way an 380 utilised in that manner will.make any money. They need to sweat a us east cost rotation in between the JNB Sin and HKg rotations. It is these long flights where the seat cost benefit over th 744 kicks in
 
BOSAero
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sun Apr 14, 2019 10:08 am

musman9853 wrote:
BA777FO wrote:

Waterbomber2 wrote:
We'll see.
That BA is losing relevance in all its markets, from Asia to TATL and the Kangaroo route is a certainty. Short-term profits, long-term disaster.


I have no idea what you're talking about. It's the strongest player in the Transatlantic market from the UK - growing in capacity and destinations served every year. KIX shows BA can carve out a niche in Asia too - the UK's geography simply doesn't lend itself to be a strong player the the Europe-Asia market. Kangaroo route yields have been trashed by the ME3's over capacity, BA is holding its own well on the LHR-SIN-SYD route.

BA is well equiped to make long term profits - the mix of 787s, 777X and A350s plus A320neos, an expanded LGW slot portfolio to exploit, competitive cost base and improving products shows BA will be a top player for years to come. Shunning more A380s may well prove to be one of its most shrewd decisions.


yeah, idk what he's talking about. especially considering the rumors american is gonna stop serving jfk-lhr on their own metal in favor of BA's jets. BA owns the jfk-lhr route.


Watch out. B6 coming in hot.
 
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JerseyFlyer
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sun Apr 14, 2019 11:05 am

The cost of reconfiguring the interior will surely depend on how far away the used frame is from BA's standard configuration. It may well be that MH's 6 (say) are further away than LH's 6 which it will soon trade back to Airbus. We shall see.
 
Bobloblaw
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sun Apr 14, 2019 11:21 am

musman9853 wrote:
BA777FO wrote:

Waterbomber2 wrote:
We'll see.
That BA is losing relevance in all its markets, from Asia to TATL and the Kangaroo route is a certainty. Short-term profits, long-term disaster.


I have no idea what you're talking about. It's the strongest player in the Transatlantic market from the UK - growing in capacity and destinations served every year. KIX shows BA can carve out a niche in Asia too - the UK's geography simply doesn't lend itself to be a strong player the the Europe-Asia market. Kangaroo route yields have been trashed by the ME3's over capacity, BA is holding its own well on the LHR-SIN-SYD route.

BA is well equiped to make long term profits - the mix of 787s, 777X and A350s plus A320neos, an expanded LGW slot portfolio to exploit, competitive cost base and improving products shows BA will be a top player for years to come. Shunning more A380s may well prove to be one of its most shrewd decisions.


yeah, idk what he's talking about. especially considering the rumors american is gonna stop serving jfk-lhr on their own metal in favor of BA's jets. BA owns the jfk-lhr route.

Where is this story that AA is going to end JFK-LHR?
 
Arion640
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sun Apr 14, 2019 11:55 am

uta999 wrote:
Why waste $50 million refitting a used A380? Most passengers wouldn’t even notice the difference. Just buy some from one airline and put them into service, with new headrest covers and a fresh coat of paint on the outside.

They could just be a sub-fleet for use on US East Coast services.


Not going to happen. BA aren’t hifly.
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flee
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sun Apr 14, 2019 12:09 pm

BA was just using the A380 to get a sweet deal from Boeing for the B777-9, nothing more!
 
BA777FO
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sun Apr 14, 2019 12:25 pm

Waterbomber2 wrote:
That there is no second hand market for the A380 plays in favor of an operator that flies its frames all the way to the scrap yard.
How? New frames are cheaper to aquire, used frames are cheaper to acquire.


Except no A380 operator is going to fly those frames for 30 years. 10 to 15 years seems to be about the going rate at the moment. The operating economics just don't stack up. A 777 can have a destination alternate at pretty much the closest airport to its destination, an A380 cannot necessarily do that - additional fuel carriage is expensive. As is maintaining yields in November and February. And there's cargo - BA has no destination that is solely operated by the A380 because it requires the 777 or 747 to haul the cargo the A380 cannot. Aside from once daily to HKG, SIN and JNB the A380 doesn't really work anywhere for BA.

Waterbomber2 wrote:
BA is well equipped for future downsizing, which is what they are already doing.
A few more airframes but smaller average frame size.
That is literally called downsizing.


That's not downsizing - downsizing would be flying fewer seats but BA is offering more seats and flying more passengers. ASKs and RPKs have been on an upward trend since 2009.

Waterbomber2 wrote:
BA's presence IN Asia has gone from co-dominant to passive at best. Japan, China and India? Meh, just dots on a map.


BA has 7 daily flights to India - how many European airlines have more? BA is one of the market share leaders on India-USA traffic. BA is double daily to Tokyo and just added Osaka. China is a rough market from the UK due to visa restrictions for Chinese nationals. As has been said though - the UK's geography doesn't lend itself to being strong to Asia but BA is a leader in India and is growing in Japan. Hardly passive.

Waterbomber2 wrote:
JFK-LHR is doing great. But look what they have on the route now. The queen of the skies is bringing home the profits.


And those profits will be even higher with the 787-10 on the route and co-location with AA at T8.

Waterbomber2 wrote:
There is no reason to think that the similar-sized B777X won't do the same, or is there? How does a paid-off B744 stack against a 200 mill shiny new B777X?
Can the lower fuel and maintenance bills of the B777X offset the higher capital cost in a low utilization operation such as Jfk-lhr where more time is spent on the ground parked or taxiing than flying?


Many of the 747s are coming up to requiring heavy D checks - that's a lot of expensive maintenance and downtime. The cost of that alone makes the 777X and its associated fuel saving quite marked. However, your mistake is that a) you assume the 777X will fly to JFK in significant numbers and b) that's the only route it'll do. A JFK rotation will then go onto somewhere else before it sees JFK again - in between it'll go Austin, Los Angeles, San Francisco, Delhi or the like.

Waterbomber2 wrote:
At the end of the day, there won't be much difference between the B744 and the B777X, cost wise.
And there lies the problem imo.
You don't spend billions on a new subfleet for a status-quo, when you can expand an existing A380 fleet with commonality, savings of scale, a better product, while increasing capacity and dominance on your core market.


Except the 747 is coming to the end of its useful life. They need to replaced. Flying them for another 15 years is not an option. At $80 per barrel flying the 747 becomes quite uneconomical too. Below $60 per barrel they're good value, hence why they've stayef as long as they have.

The 777X will have more versatility, a better CASK and better also benefits from commonality. If the A380 was so wonderful then Virgin would have taken delivery of their order, KLM would have bought some and Air France and Lufthansa would have ordered more. Ask yourself why they haven't. For the same payload to HKG from LHR a 77W burns 60% of the fuel that an A380 does. It's a phenomenal saving.

jfk777 wrote:
Why no mention from Airbus about any A350-1000's ? While the RFP was for 777 and 744 replacements that had to include planes beyond the A380, if BA did order any it would be 6, 8 maybe 10 at most. A follow on order for A350 would have been for more than the quantity of A380's.


Apparently the Airbus offer was for a mix of A380s and A350s but the pricing and timing of A350 deliveries wasn't good enough.

Armodeen wrote:
Btw I don’t really get how the 779 will be massively more flexible, it is itself a very large aircraft


Because the 777X will be able to operate into any airfield that the 77W can, ie just about anywhere. The A380 still has a lot of the world that is simply unuseable. Plus the 777X won't have the same passenger capacity as the A380 - the pressure on yields outside of peak periods won't be anywhere near as bad as on the A380. Given trip costs, the break-even loadfactor for a 777X is considerably lower than for an A380.

BOSAero wrote:
Watch out. B6 coming in hot.


With the same number of J seats across their 3 daily flights as BA has on one flight? While BA and AA operate 14 daily flights, Jetblue will "come in hot" with 3? Reckon BA will cope ;)
 
9Patch
Posts: 102
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Re: Package of new/used A380's pitched to BA was uncompetitive: Cruz

Sun Apr 14, 2019 1:33 pm

Arion640 wrote:
It will depend if it’s in Y or Business. I much prefer a stop anyday if flying over 6 or 7 hours in Y.

To each his own. I can't see the logic of boarding, taking a coach seat, flying to some connection airport that may add more distance and time to your trip, de-boarding, waiting a couple of hours, going through the whole re-boarding process again to get into another coach seat, finally reaching your destination and de-boarding yet again.

Your six hour or seven hour trip is now nine or ten hours or likely even more. Add in the possibility of delays and missed connections, and it can turn into nightmare.

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