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The LA Fires Underscore the Need for Preventive Aerial Firefighting

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As we see priceless works of art at the Getty Center in LA endangered by a fire just across the freeway and thousands of people displaced by wildfires, the need for increased aerial firefighting support is quite clear.

The technology is available. The CL-415 built by Viking in Vancouver BC was initially a Bombardier design purpose-built for firefighting. Viking Air in Sydney BC is considering restarting the production of the CL-415. This “super-scooper” can land on a lake or river and scoop up a full load to be back fighting fires much more quickly than other tankers, which need to land and be refilled from water systems.

Just as we had flights of bombers in World War II, imaging 12 or 24 of these water bombers, flying in formation, dousing wildfires just after they begin and before they become massive conflagrations. Is it possible? Yes. Does it make sense? Yes. Will it happen? Not without government getting out of the way.

The government can’t fund aircraft purchases, and can’t enter into leases longer than a year under current fiscal regulations.  The CONOPS,  to rewater at an airport is antiquated.  You need persistent delivery with minimum time between refilling airplanes and only the CL-415 and BE-60 can do that.

This is why the US Forest Service fleet is a mishmash of old aircraft that have been converted to firefighting operations.  Unfortunately, those aircraft aren’t as reliable nor as effective as new aircraft that are purposely designed for that purpose. (The 747 Supertanker is an exception)

Major players in the insurance industry claim to be expert at risk management.  If they truly were, however, they would create a joint venture to quickly handle wildfires and avoid multi-billion losses.  Every year, we see massive fires in the Western US, and similarly, as the seasons change, massive wildfires in Australia.  The cost of a fleet of CL415s, strategically placed to hit wildfires as soon as they emerge, would be much less than the cost of paying insurance claims when homes are lost and the lives of people negatively impacted.

The Bottom Line:
There is a solution.  Have the insurance industry privately fund a fleet of aircraft that can be dispatched to knock down major fires before they become disasters.  Looking at the cash flows, it would be cheaper than paying massive claims.  As the old adage states, “an ounce of prevention is worth a pound of cure“.  Early action is essential in knocking down fires, and clearly, the current practices are not working.  Whatever happened to common sense?

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Premium #254 – Holiday Travel: Fares, Bag Fees, and Heavy Loads

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Premium #253 – Making Boeing Great Again

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Making Boeing Great Again should not be the goal of US trade policy. The trade action by Boeing against Bombardier appears, superficially, to fit well with President Trump’s campaign theme to Make America Great Again. President Trump campaigned against unfair trade practices that are harming U.S. workers and U.S. manufacturers. Boeing alleged that Bombardier is unfairly subsidized by Canada, which has permitted it to sell CSeries aircraft below cost in the United States, undercutting Boeing and the U.S. jobs from Boeing’s most successful aircraft, the 737.

Upon closer inspection, however, it is clear that Boeing’s actions, if successful, could harm more U.S. workers in the broader aerospace and airline industries than would potentially benefit from import tariffs designed to protect Boeing.

Moreover, because Boeing stretched the bounds of appropriate use of the trade enforcement remedies and deployed a host of arguments that are hypocritical or baseless – such as complaining about sales lost to a plane smaller than anything Boeing makes – Boeing risks igniting a trade war or other realignment in the aerospace sector, to the detriment of the US aerospace industry. If Boeing succeeds in its trade case, the only beneficiary will be Boeing itself – while everyone else loses. This strategy is not Make American Great Again — at best, it is Make Boeing Competitive Again.

Perhaps more than any other U.S. manufacturer, Boeing depends on international trade and the U.S. government’s enforcement of fair trade rules abroad. But its trade case against Bombardier now undermines Boeing’s ability to fight unfounded protectionist actions instituted in countries around the world. China, for example, could easily levy massive import duties on Boeing’s planes using the same arguments advanced in Boeing’s trade action against Bombardier. That would be a disaster for Boeing and the U.S. workers who manufacture its planes. Rather than pick on a competitor one-tenth its size, with arguments that are full of inconsistencies and contradictions, detailed below, Boeing should abandon its misguided use of the trade laws and focus on being competitive at the marketplace.

Boeing Contradicts Itself about the Relevant Market
In the trade case, Boeing claims that there is a separate and distinct market for aircraft containing 100 to 150 seats that are capable of flying 2,900 nautical miles. Unfortunately, Boeing has convinced U.S. regulators of this spurious proposition, despite widespread industry understanding that the aircraft market is a continuum, ranging from the smallest regional jets to the largest wide bodies. Airlines choose a platform of the right size for a given route to optimize their operating economics and right-sizing aircraft to avoid flying planes with empty seats.

Outside of the trade case, Boeing characterizes the market differently. In its Current Market Outlook, Boeing describes a market composed of regional aircraft, single-aisle aircraft, small to medium twin-aisle aircraft, and large twin-aisle aircraft. Reviewing Boeing’s annual forecasts in our archives back to 2005, we find that Boeing’s forecasts consistently reference the single-aisle market, not a market for aircraft with 100 to 150 seats. Indeed, it would be irrational for Boeing to describe the market that way, as its flagship 737 has grown from under 100 to about 200 seats with some models of the 737 MAX, the newest 737 variants.

On September 18, at the 18th Annual Aviation Industry Suppliers Conference (SpeedNews) in Toulouse, Drew Magill, Boeing’s Managing Director, Marketing Europe offered this slide.  Boeing describes the competitive situation, when speaking to the people who know the industry, and does not include the Bombardier C Series (or the Embraer E2).  Were Boeing to list the Bombardier or Embraer products, they would be laughed out of the room.  Nobody from the US Department of Commerce or ITC was in the audience obviously.  Boeing has two messages; one for those who know the industry and another for those who don’t.

Over the years, Boeing increased the size of its 737 to provide additional capacity and improved seat-mile economics for its airline customers. The original 737 design, which dates to 1967, had fewer than 100 seats. The 737 MAX line has been optimized around the 162-seat 737 MAX 8. The smallest model, the 737 MAX 7, had 126 seats. This model did not sell well, and last year Boeing redesigned the aircraft to add 12 additional seats – taking it to 138 seats – in an effort to make the aircraft’s economics more competitive.

Seat-mile economics are challenging for the 737 MAX 7 because it is simply too heavy for its seat capacity. The wing and fuselage were designed to accommodate the needs of the MAX 7’s larger brethren. As a result, the 737 MAX 7 is less efficient than more modern designs – such as the C Series – that are optimized around a smaller size and use the latest composite technology that is not used in the 50-year-old design of the 737. Not surprisingly with these economics, the 737 MAX 7 has not sold well. Although Boeing has 3,954 orders for 737 MAXs, only 70 are for the 737 MAX 7.

Although Boeing’s Market Outlook considers the single-aisle market to be a continuum of sizes, it has conveniently based the trade case solely around the least efficient and most unpopular model in its 737 fleet, ignoring the other 3,884 aircraft in its backlog.

Boeing Complains About a Lost Sale but Doesn’t Make a Competing Product
The trade case centers on Bombardier’s sale of CS100 that has a typical configuration of just over 100 seats. Delta is the largest operator of aircraft in this class, operating 91 of the last aircraft Boeing produced of comparable size, the 717-200, which is a rebranded version of the MD-95. Boeing last produced the 717-200 in 2006, and today offers no aircraft in the 100-seat category. As a result, Boeing did not participate in the Delta competition that led to the C Series order.

What does Boeing think Delta should do to serve routes that require 100 to 110 seats? Should Delta have been required to fly an aircraft that is too large to be profitable, simply so that it can fly Boeing? Should Delta charge consumers a higher ticket price to pay for the empty seats on these segments? Other than the C Series, only Embraer makes an aircraft – the E195 – that can serve a 110-seat route. If Delta could not buy the C Series, they would almost certainly have chosen Embraer, further highlighting that Boeing’s alleged harm from a lost sale is entirely fictitious.

Boeing’s Claims of Economic Loss is Baseless
Boeing’s claim that it is suffering an economic harm from the sale of 75 C Series aircraft to Delta is dubious, at best. As noted above, Boeing’s backlog of orders for the 737 is about 4,000 aircraft deep, and it stretches years into the future. Even if Delta decided to fly less efficient 737s with dozens of empty seats on 100-seat routes, Delta would not be able to receive delivery of these aircraft without a lenghtly wait, long after Bombardier could deliver the C Series.

On a recent call with investors, Boeing CEO Dennis Muilenburg was asked whether the company would consider entering the 100-seat market with a new aircraft or joint venture with another manufacturer. Muilenburg dismissed the idea and said, “with 4,400 aircraft in backlog, we’re very confident in the position we have and the fact that we’re oversold on our production line capacity.” Muilenburg concedes that Boeing has sold more aircraft than it can possibly produce and deliver, yet it has the gall to go before the U.S. government and claim that it is experiencing economic harm from a 75-aircraft order from Bombardier.

Boeing Practices the Same Pricing Strategy that it Denegrates
Creating an entirely new aircraft design takes a tremendous amount of upfront investment, and that investment is recouped over decades, as the aircraft is produced and sold. The first plane produced in a program, therefore, is sold dramatically below the cost of producing it. Moreover, production costs drop quickly, as the manufacturer moves down the learning curve associated with repeated production of the aircraft.

Even beyond these economic realities, new aircraft programs face additional barriers. Airlines are hesitant to be the “guinea pig” to help debug early faults. New aircraft platforms also bring greater costs to the airlines in terms of flight crew training, new ground handling equipment and procedures, the distribution of maintenance supplies throughout the airline’s network, training of technicians, and uncertainty about the long-term availability of affordable parts.

These additional costs and uncertainties for airlines limit demand for new aircraft platforms, and the reduced demand causes aircraft manufacturers to offer significant discounts to the first airlines to purchase a new platform. This practice, which is deployed by every aircraft manufacturer, is so common and well established that it is named: launch customer pricing.

Boeing’s launch of the 787 is a perfect example of this practice. The first several hundred 787s sold by Boeing were reportedly sold below the cost to make them. Analysts wonder whether Boeing will ever break even on the 787 program on a cash flow basis, and recoup its $30 billion investment.

Bombardier only recently started delivering its first C Series planes, and it is far from moving down the learning curve to a mature cost position for the aircraft. Ironically, Bombardier could not even respond to the U.S. government’s questions about the cost of producing the C Series aircraft for Delta. It has not yet built enough aircraft to know what its final cost will be. How can a manufacturer be dumping product into the United States below cost when the manufacture does not yet know the final cost of production?

Boeing Ironically Complains about Government Subsidies
Boeing states that it does not receive government subsidies. But its military division develops new technologies at government expense, and then shares those technologies with its commercial operations. Boeing also receives tax breaks and aid from the states in which it operates, and it has requested even more aid from the State of Washington to keep manufacturing jobs near Puget Sound.

Given the massive costs associated with developing new aircraft programs and the long time horizon for recouping any investment, it is impossible today for any company to develop a new aircraft program without some government support. The governments of all major aircraft manufacturers recognize this and all of them provide some form of support. Indeed, international law recognizes this reality. International trade rules do not outlaw all government subsidies – just those that are unfair. Boeing acts as if the Quebec and Canadian investments in Bombardier are de facto a violation of international law, but that is just not the case.

What Really Scares Boeing and Motivated the Trade Action
Boeing’s filings do not mention it, but we believe that Boeing’s greatest fear is that Bombardier might stretch the C Series into a larger aircraft that really does compete with Boeing’s bread and butter 737 MAX 8. Given its more modern design and advanced composite components, a stretched CSeries might actually compete against the 737 MAX 8 and take market share from Boeing’s massive backlog. In other words, the trade case is a preemptive action designed to kill the C Series program in its infancy before it has a chance to mature.

Boeing already has two aircraft under development, the 777X and 797, and it cannot afford to launch a clean-sheet design of a new aircraft in the 737’s size category. It could perhaps undertake such an initiative in the 2025 to 2030 timeframe. In that regard, Boeing may be perfectly happy with any outcome in the trade action, provided that it distracts Bombardier, discourages near-term customers to buy the C Series because of its future uncertainty, and pushes C Series deliveries a few more years into the future.

Boeing may have had a greater fear that Bombardier would join with an aerospace manufacturer in China that could use the C Series technology as a platform to build a competitor to the 737. A significant portion of Boeing’s projected revenue growth comes from sales to China. A competitor to the 737, manufactured in China, would be a significant threat to the company. That process, however, would have taken a number of years to unfold, and in trying to forestall it, Boeing miscalculated miserably. In attempting to block a long-term threat from China, Boeing drove Bombardier to a formidable competitor with the ability to unleash the C Series threat immediately.

Airbus’ decision to join with Bombardier provided the C Series a massive boost in credibility and eliminated any doubt about the programs continuing viability. The Airbus partnership came with an added benefit – Bombardier and Airbus can manufacture the C Series in Alabama, putting the C Series beyond the reach of the import tariffs that Boeing sought in the trade action.

Boeing’s Statements about Airbus’s Alabama Assembly Facility Boomerang
The Airbus-Bombardier deal on the C Series, which will close around mid-2018, effectively eliminates the effect of any import tariffs that Boeing manages to convince the U.S. government to impose on the C Series. C Series planes built in Mobile, Alabama, are U.S. products and thus not subject to import duties.

Rather than accepting that the trade laws worked as intended and promoted U.S. manufacturing and U.S. jobs – the threat to which was the premise of Boeing’s original complaint – Boeing is now suggesting that import tariffs should be applied to planes that are made in the United States.

The only problem is that Boeing has already argued the opposite and the company again faces a contradiction of its own making. In its initial complaint in the trade action, Boeing stated that Airbus aircraft built in Mobile qualify as domestic manufacturing. Discussing the Airbus A319, the only Airbus aircraft that fits in Boeing’s artificial 100- to 150-seat market category, Boeing said, “the Airbus A319 would also be included in the domestic [production category] if Airbus were to produce it at its facility in Alabama.” If building an A319 in Mobile is domestic manufacturing, it’s hard to understand why a C Series built there would not be.

The Bottom Line
Somebody in Boeing’s Chicago office apparently determined that the complaint against Bombardier would be effective in thwarting a competitor. Instead, it has backfired, resulting in Boeing being roundly criticized around the world, and creating a black eye for the United States with respect to free trade. It’s not too late for Boeing to acknowledge the complaint was ill founded and seek to regain its reputation for fair play. If it does not, AirInsight hopes that the ITC will see through Boeing’s hypocritical, contradictory, and absurd claims when it renders a final decision.

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Aging 100 Seat Aircraft: Low Hanging Fruit for the E2, C Series, and SSJ

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The 100 seat aircraft market is undergoing a transition, as Sukoi, Embraer and Bombardier all have new aircraft available in that size category.  At the same time, several aircraft types are aging dramatically or economically challenged that need replacement.  And when new aircraft meet operator needs, sales should occur.  What have we seen and what can we expect from this market?

The replacement aircraft candidates include the A318 from Airbus, the 737-600 and 717-200 from Boeing, the Fokker 100, and the BAe146/Avro RJ family.  At the end of the second quarter 2017, there were 657 aircraft from these models still in service, with an average age of 21.5 years.  Clearly, replacements will soon be in the works.

The table below shows that 516 aircraft are flown by the 47 carriers with a fleet size of 4 or more aircraft.

Seventeen airlines have a fleet of 10 or more aircraft in this category that need replacement and account for 359 of those aircraft.  These are clearly the priority targets for the OEMs.  In examining the fleets of these airlines, many have already made their new aircraft selection while others are likely to invite competition over the next year or two.

Management running marketing for the three OEMs no doubt have sales teams focused on Australia and Iran, each of which has substantial opportunities for fleet renewal.  Let’s look at the largest carriers and opportunities.

Delta Air Lines is the 900-pound gorilla of this group, with 91 Boeing 717-200s, which it has already decided to replace with the Bombardier C Series, for which it has ordered 75 plus 50 options.

Next in size is Cobham Aviation in Australia with 20 717s and 10 BAe/Avro RJs that will need replacement.  While its 717s are nearly 15 years old, the remaining aircraft average over 23 years old and will soon be in need of a replacement.  This could be a two-tranche order for 10 in the next year or so, plus another 20 five to ten years later.  We would suspect that Macquarie Leasing in Australia has targeted these folks as a potential customer for their C Series positions.

Hawaiian Air is next in size, with 20 Boeing 717s.  The carrier is apparently quite satisfied with the aircraft, which average 14.4 years of age, and should remain in the fleet for 6-8 more years before replacement.  Hawaiian moves to the back burner.

Air France operates 18 A318s.  With the Airbus acquisition of the C Series, there is an opportunity to replace these less efficient aircraft, but they average only 12 years of age.  This also looks like a 6-8 year opportunity.

Alliance Airlines in Australia, a Virgin Australia feeder, operates 18 Fokker 100s that average 26.1 years of age.  These aircraft will be due for replacement quite soon, and present another in country opportunity for Macquarie Leasing.

Avianca Brazil operates both A318s and Fokker 100s. While the 12 A318s are young, at 9.3 years on average, the 6 Fokker 100s average 25.3 years of age and need replacement.  This looks like another potential two tranche order scenario with 6 now and 12 later.  Geographically, we would expect Embraer to have the inside track. But Avianca is a loyal Airbus customer, potentially giving the C Series a chance.

SAS operates 18 737-600s.  Those aircraft average 18.4 years of age, and will soon be replaced by A320neos beginning in 2019.  Might SAS decide that smaller airliners are still needed in its regional network?

Iran Aseman operates 17 Fokker 100s that average 23.7 years of age and needs replacement.  While economic sanctions have been lifted for aircraft, the threat of a potential reinstatement looms for Iranian airlines, whose access to key aviation capital remains politically restricted.  There is a strong opportunity here for Sukhoi should the Pratt & Whitney GTF engine that powers the E2 and C Series become subject to additional sanctions. Iran overall offers big opportunities because its fleet is so old.

Network Aviation operates a fleet of 17 Fokker 100s as a Qantas regional subsidiary based in Perth.  With a fleet averaging 24.4 years of age, fleet replacement is likely in the near future as the Fokker 100s become increasingly uneconomic. Another Macquarie opportunity?

Volotea Airlines, a Spanish low-cost airline operates a fleet of 17 717s that average 13.8 years old.  This appears to be an opportunity five to eight years from now, as the fleet remains young and fuel prices remain low.

Mahan Air in Iran operates a fleet of 16 BAe and AvroRJs that average 23.6 years old.  These are candidates for replacement, pending political sanctions on capital and aircraft transactions. As mentioned, Iran is a big opportunity.

Citijet, based in Ireland, offers code-share and wet lease services to several major airlines in Europe.  It operates 15Avro RJs that are scheduled for replacement by Sukhoi Superjets over the next 2-3 years.

Iran Air operates 15 Fokker 100s that average 24.1 years of age, and will soon be candidates for replacement, pending financial and aircraft sanctions.  The airlines in Iran represent a significant potential, as their fleets are quite old and need rapid replacement.

Virgin Australia Regional, formerly Skywest, operates 14 Fokker 100s that average 24.6 years of age, and will soon be due for replacement.   Another Macquarie opportunity?

WestJet, a Canadian low-cost carrier, operates an all-Boeing fleet including 13 Boeing 737-600 models that average 11.5 years of age.  While these aircraft are economically inefficient compared to new technology, WestJet’s focus on commonality and a single aircraft type will be difficult to break.  Nonetheless, there may be increasing political pressure in Canada with respect to their replacement in five to 10 years.  Boeing has nothing to offer in the size, as Delta has pointed out.  Meanwhile, the airline is now a Bombardier customer as it operates Q400s.

Braathens Regional, a Swedish regional carrier, operates 12 AvroRJs averaging 22 years of age and has selected the Bombardier C Series as a replacement, with 10 CS100s on order, with 10 options, to replace them.  But there seems to be no rush to take deliveries.

Avianca, based in Colombia, operates 10 A318s that average 12.5 years of age.  The Avianca-TACA group will likely order the same aircraft type for multiple operations, and currently are strong Airbus operators with A320 family aircraft.  Avianca currently operates 12 Embraer E190 aircraft, and given its Latin American geography, we believe the E190-E2 has a potential advantage when the A318s need replacement during the next decade. As pointed out above this will be a classic Bombardier vs Embraer tussle.

Are there some quick wins for Embraer, Bombardier, and Sukhoi, all of whom could use additional orders to boost their programs?  We believe so, and that Australia and Iran offer the quickest opportunity for success.  Economic sanctions in Iran could benefit Sukhoi, while the competition in Australia is wide open.

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Emirates and the A380

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The A380 is somewhat of an enigma.  While it is the solution to congested airports, and is well preferred by passengers in survey after survey, it has not sold particularly well.  Only one carrier, Emirates, seems to understand how to make money with the A380, which is the mainstay of its Dubai connecting hub for long-haul international travel.

Introduced 10 years ago, some of the first A380s from SIA are coming off-lease are now being replaced with new models. With residual values yet to be set once the first retired A380s are traded. A used A380 could be quite attractive to carriers that favor early availability coupled with flexible financing. (perhaps those folks in Atlanta).

Plus the A380 remains very attractive as a slot consolidation aircraft.  For carriers with multiple frequencies into congested airports like London’s Heathrow, the freeing of a slot enabling service to a new airport through frequency consolidation can be a financial windfall. The key question is to what degree frequency and time of service impact demand.  Heathrow also provides a special attraction for the A380.  The airport’s landing charges now have a noise component.  Because the A380 is so quiet, it is cheaper to land at Heathrow than a 777.

Another airport that uses noise levels in its landing fees is Narita, where the A380 shows the same benefit over the 777.  Today it’s clear that airports have to deal with more than just terminal limitations or runway slot constraints to maintain or expand operations.  Local community noise tolerance is becoming increasingly important.  Being a quiet neighbour is now a key requirement to getting the political allies for the future development.

Emirates has taken 100 A380s over the last decade, an average of 10 per year.  If we assume they will be replaced after 12-15 years, and replaced with newer A380s, the only aircraft with the same capacity, then Airbus could expect orders for 10 aircraft annually from 2020-2030.  That is certainly adequate to keep the production line humming.

The industry expected Emirates and Airbus to announce agreement on a new order for 36 A380s at Dubai that did not materialize.  Publicly, Emirates has stated that it wants a commitment from Airbus to keep the A380 line open for another 10-15 years.  In addition, Emirates has rejected the A380Plus concept from Airbus, which is detailed here.

Is there something more going on behind the scenes?  We believe so.  Emirates would like an A380neo, as more modern engines would restore the once-significant seat-mile costs advantage for the aircraft that is now evaporating as new technology aircraft enter the market.  Airbus is finding it difficult to justify, even though they, as we, believe increasing airport traffic will make A380 sized aircraft essential at major hubs.  However, in Airbus’ defence, they o not have the same step change in engine technologies that allowed for its other neo programs.  Both the Trent and GP7200 on the A380 today are relatively new engines.  Moreover both engines have seen upgrades to offer better economics.  Then there are airframe improvements that need to be considered – and the A380plus is a step in that direction.  Airbus is waiting for the right critical mass of technologies to emerge that will enable the 15%+ improvements that a neo require.  Emirates may be pushing, but they have to acknowledge that there are no engines ready.  Rolls-Royce might have a solution with fan engine but that is going to be ready by 2025.

Airbus knows that airlines don’t like risk and behave in risk averse ways.  The two recent C Series orders, coming soon after the Airbus interest in the program, illustrate that.  With Airbus now behind the program, several risks, including long-term customer support, have been eliminated, clearing the way for purchases that likely would not have happened as quickly without that assurance.

Airlines don’t like to take the risk of filling large airplanes.  Every week has a Tuesday, and every year has a February in which demand will not be as robust as other periods.  Many airlines prefer an aircraft they can fill every day, even if they cannot accommodate some traffic, so if slots are available, they would prefer to fly aircraft they know they can fill rather than one that introduces uncertainty.  Since Airbus hasn’t been successful at selling the A380 in large numbers, what market conditions would change to enable larger sales of the A380neo?  Amedeo has some ideas it is working on that address this challenge.

Another answer is constraints.  While megacities are growing, and traffic is growing faster than airport capacity, route dispersion is fragmenting the “hub and spoke” models in Europe and the US.  In the early 1960s, flying to Europe meant transferring at Idlewild in NY.  Today, many major cities have non-stop service across the pond to multiple destinations.  In Europe, even Lufthansa splits its connecting traffic and intercontinental routes between Frankfurt and Munich, which helps eliminate congestion at Frankfurt, but also the need for an A380, since A350s from Munich take some of the traffic.

However the fragmentation thesis is still developing.  Among the A380 operators only one airline has two hubs in their home markets.  This means those A380 operators are able to exploit and focus the aircraft’s particular capabilities.  Which means that connecting megacities will invaribly require VLA aircraft because, as we see across the globe, airport growth is protested.  Does congestion impact?  The answer is yes, because traffic growth is outstripping airport growth and capacity.

Consequently the absence of a deal at the Dubai show between Airbus and Emirates is not the end of the story.  Emirates does not want to drive Airbus into a sub-optimal decision regarding the future of the program.  Both firms are tied to each other around the A380.  Besides the reason that the likes of BA, Lufthansa and Air France are slowing down their A380 interest is because Emirates has been taking more traffic from them, especially between Asia and Europe.  That alone suggests that Emirates will keep acquiring A380s, especially as its older models are retired.  Just like Singapore Airlines.

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Premium #252 – Growing Derrieres, Shrinking Seats

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