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Airbus could abandon A380 superjumbo jet production amid lackluster sales

Associated Press

PARIS – Airbus said Monday it will stop making the costly A380 superjumbo jet if the European multinational corporation doesn't land a long-term deal with the Emirates airline for a steady supply of the planes.

File photo taken in 2015 shows vapor forming across the wings of an Airbus A380 jumbo jet during a demonstration flight at the Paris Air Show.

Abandoning the A380 would be a disappointing defeat for Airbus, which spent many years and many billions developing the double-decker behemoth, even as skeptics questioned the whether the jet would generate enough demand to justify its cost and the bigger runways it requires.

"If we can't work out a deal with Emirates, there is no choice but to shut down the program," Airbus chief salesman John Leahy told news reporters in Paris.

Leahy said the Dubai-based, government-owned airline is “the only one who has the ability” to commit to a minimum of six planes a year for a minimum of eight to 10 years, the production timetable Airbus needs to make the program viable.

Emirates declined to issue an immediate comment.

Airbus discussion of the potential cancellation came as the Airbus said net orders for all of the company's aircraft rose 52% to 1,109 in 2017. The total topped the 912 commercial plane orders reported by U.S. aerospace giant Boeing and made Airbus the winner in the rivals' annual order contest for a fifth consecutive year.

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The A380 drew worldwide attention when launched a decade ago but has always struggled to win enough customers. Airbus delivered just 15 of the planes last year, and aims to deliver 12 more this year and could scale down production to six per year after that, CEO Fabrice Bregier said.

Emirates now relies solely on the Airbus 380 and the Boeing 777 for its flights, making it the largest operator of both. It has over 160 Boeing 777s in its fleet today and took possession of its 100th A380 in November.

Reports circulated before the Dubai Air Show in November that a major A380 sale would be coming.

Instead, Airbus employees found themselves attending a news conference at which Emirates announced the purchase of 40 Boeing 787-10 Dreamliners in a $15.1 billion deal. The air show ended without an A380 deal, throwing the line's future into question.

Airbus, based in Toulouse, France, reported Monday that it delivered 718 planes in 2017, fewer than Boeing’s 763 but still a record for Airbus.

Bregier said Airbus will speed up production in the coming year, notably of its long-delayed widebody A350, and hopes to out-deliver Boeing by 2020.

Bregier, who’s being replaced next month by Guillaume Faury as Airbus overhauls its top management, acknowledged “challenges” lie ahead but called them “manageable.”

Airbus is facing multiple corruption investigations, notably in Britain, France, and Austria.

 

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