Airbus facing a tough battle ahead

CX · Post by CX » 15 Jun 2006, 17:10

Selling updated 330s (i suppose you mean the original 350?) simply won't work because the 350, although has similaraties to the 330, actually has a lot of bits that are different to the 330, can to change from building the 330 to the 350 will cost a lot, and remember they only planned to get the 350 in service by 2010 anyway... I mean even if they can just sell 100 of the original 350 to break even, they still wont' do it because then they won't have facilities to build the A370... in the mean time the only thing they can do is to get the A370 as good as a aluminium-lithium fuselage can manage, and then have this A370 have variants from sub 300 seats up to some 350-400 seats so that it will be extremely common, so that an airline can operate a full fleet of A370s with different variants serving different routes..

RC20 · Post by **RC20** » 15 Jun 2006, 18:31

I think this one says it very well.

http://www.theaustralian.news.com.au/st ... 49,00.html

RC20 · Post by **RC20** » 15 Jun 2006, 18:34

Buzz wrote:
smacDC-10 wrote: Why would they want a trijet? A twin is just as reliable, and even the USAF will have to think of maintenance and costs at some point...

It has an outstanding power to weight ratio.

RC20 · Post by **RC20** » 15 Jun 2006, 18:38

CX wrote:Well, it's probably a good chance to buy some EADS shares now!

He asked for a a return ticket to England as the Titanic was going down

smokejumper · Post by **smokejumper** » 15 Jun 2006, 19:43

JoeCanuck wrote:The R&D has already been done on the 350...besides, since they're already conceding the #1 position to the 787, they're going to have to settle for #2, for now, and they know it.

All they have to do is take some of the upgrades from the 350, (engines, skin), bolt it onto the 330, and they'll be half way there. Since the 330 program was payed for long ago, the official development costs are peanuts compared to an all new plane.

It's not like they're going to stop making the 330. This way, instead of making a 787 killer, they are merely making an upgrade to an existing platform....one they can sell way cheaper than a 787.

It won't be a better plane; just a cheaper one. Not every customer can afford a Rolls....some are willing to settle for a chevy.

It'll be a piece of cake for airbus to do this compared to tooling up for the 350. This gives them some breathing room while they work on the plane, they hope, can take on the 787 and/or the 777.

edit....In my mind, a good auto comparison is the dodge ram truck. The diesel option is cheaper to run, but the gas version is cheaper to buy. It may take years of driving for the economy to make up the difference in price. Both, at least in Canada, sell very well. There's a market for efficient but there's also a market for cheap.

The R&D for the A350 has not "already been done" - it was started but not completed when Airbus decided to do something different (we'll have to wait see what this is). I believe that it was the A350 (redesign #4) that was to use new wings, engines, skin, new nose, etc., but work on this has been stopped. They need an entirely new airplane that offers low costs.

smokejumper · Post by **smokejumper** » 15 Jun 2006, 20:03

TexasGuy wrote:
smokejumper wrote:
TexasGuy wrote:hmmmm.....maybe we will see a return of the trijets. I always thought it was a mistake for Boeing to cancel the 3 engine MD 11. They should have focused some attention on improving a new design for passengers while selling a cargo version until the new passenger version was ready. Maybe Airbus is considering 3 engines instead os 2 or 4. This is getting very interesting :):)

....
How could cancelling a plane that was not selling (Mc-11) and loosing money be a mistake?
The sales were picking up. I think the reason Boeing got rid of it was because it was competing with the new, at the time, 777. They should have kept it going to further expand the aircraft seat market
Also it should have been continued because im biased towards the MD 11.
Was a very nice program on Discovery Wings Channel a few years ago that dealt with the MD 11 and other widebody trijets. Very interesting

When Boeing acquired McDonald Douglas, it told the McDonald Douglas marketing and sales staff that they would continue production as long as orders justified it. The sales staff tried to close deals for passenger and freight versions of the MD 11, but only picked up a few orders. Boeing allowed the line to close once orders were completed. The plane has higher fuel costs, less range (approximately 7,630 statute miles (12,270 km) with 285 passengers) and, higher maintenance costs (3 engines) than the planes that replaced it. The MD-11 was a good plane, but still just an improvement over the 1960's DC-10.

I've flown Finnair MD-11's (NY to Helsinki) and Japan Air Lines to Tokyo. The planes seemed to have higher noise levels than other planes.

TexasGuy · Post by **TexasGuy** » 16 Jun 2006, 05:03

Buzz wrote:
smacDC-10 wrote:Boeings mistake was not keeping the tooling for the MD-11. The USAF would for sure prefer a tri jet verses a twin to replace it's aging tanker fleet!
It's not like they can start building again tomorrow had they kept the tooling... It's the supply chain that's important. All suppliers have stopt making parts. Getting them to restart production is a lot harder...

Why would they want a trijet? A twin is just as reliable, and even the USAF will have to think of maintenance and costs at some point...

What? Ever hear of the B52? KC 135? KC 10? Maintenance cost if not of concern to the USAF. They are not using these planes for up to 15 hours every single day as you would find in the civilian world

:):):)

teddybAIR · Post by **teddybAIR** » 16 Jun 2006, 10:56

I found a criticizing article on Noël Forgeard (sorry, it's in dutch): http://www.tijd.be/mijn_nieuws/ondernem ... Id=2295825

Brief summary:

-early march 2006 Forgeard's family sold 290.000 EADS shares, valued € 9,31 mln
-the integrity of this transaction is now questionned as it is very plausible that Mr. Forgeard knew that they will have to announce bad news on the A380 programm
- therefore, in theory, he abbused his privileged position and took advantage of his inside knowledge

regards,
bAIR

airazurxtror · Post by **airazurxtror** » 16 Jun 2006, 13:02

Not only Forgeard's family, but also himself (and he made a pretty packet, seeing the present value of the EADS share).
He denies any inside knowledge (of the coming A380 problems and the ensuing heavy losses for EADS) - but what else could he say ?
He maintains that he didn't have any sign of the problems before April (he sold his shares in March - just in time !).
Which reminds me that the British also recently pulled out of Airbus as shareholders...

earthman · Post by **earthman** » 16 Jun 2006, 15:55

Rats fleeing the sinking ship?

TexasGuy · Post by **TexasGuy** » 16 Jun 2006, 16:01

earthman wrote:Rats fleeing the sinking ship?

Thats a pretty strong statement......

....

bits44 · Post by **bits44** » 16 Jun 2006, 23:26

There are those in the Airline Industry that have suggested that Airbus would be very wise to concentrate all their resources and efforts toward the successful completion and delivery of the A380.

To hurry and try to play catch-up with the 787 may cause more distrust, they really need to come up with an aircraft with the same wight saving construction and features the 787 has, or better. The airlines need to have a viable alternative that is competitive.

They may have to delay the introduction of a A350 or replacement model until they can come up with a solid design they can build on time and delivered when they say they will deliver.

Really regaining the trust of the Industry is paramount, they can't afford to make any more promises they can't fullfill, with maybe a few changes in the upper management structure that will happen.

TexasGuy · Post by **TexasGuy** » 17 Jun 2006, 04:57

I think this is just a hiccup, growing pain for Airbus. They will pull through it. Hopefully they will get through it fast because Boeing is constantly pulling ahead. Something i think we will see is more innovation and new ideas and amenties due to the strong offerings of the 787. Competition is good for the consumer

:):) So if any Airbus people are reading this....get off your butts and get moving on an innovative plane to battle 787

CX · Post by CX » 17 Jun 2006, 08:58

in reponse to bits44: The problem with simply waiting and get the A380 done is what if no one orders the A380 after these initial orders? I mean you never know, if fuel prices goes to $100/barrel chances are the demand for A380 will decrease, or what if airports charge crazy landing fees on the A380? Then Boeing would be romping away with the 787 (and 777) with absolutely no compeitor, and an updated 777 might threaten the new Airbus as well...

So while i agree that the new 370 will NOT bring better weight savings than the 787 (that is for sure), i guess if they can have a very wide fuselage (10 abreast?) and then have variants ranging from some 270 - 400 seats, then that would be great, an airline would have very good functionality even if it ONLY has A370s, and having 50 A370s, for example, will surely lower the maintenance cost and trainning costs as opposed to 25 A370s and 25 787s, or even 25 777s and 25 787s.

JoeCanuck · Post by **JoeCanuck** » 17 Jun 2006, 13:06

>>The R&D for the A350 has not "already been done" - it was started but not completed when Airbus decided to do something different (we'll have to wait see what this is). I believe that it was the A350 (redesign #4) that was to use new wings, engines, skin, new nose, etc., but work on this has been stopped. They need an entirely new airplane that offers low costs.<<

I think you're missing my point, which is, make the 330 as efficient as you can, as cheaply as you can. It won't be the super bestest plane that the 787 is, but it'll be better than what's flying now.....new engines, take out some weight, and sell them at walmart.

What they do after that, in fact all of this, is speculation. I really don't think Airbus, or Boeing is paying much attention to anybody's posts.

Sure, it's fun to gossip, but we know absolutely nothing about what's wrong with the 380 or what' happening to the 350/370.

If we were so darned smart, we would have bought microsoft in 1985. Hands up everybody who can see into the future.....

TexasGuy · Post by **TexasGuy** » 17 Jun 2006, 17:03

CX wrote:in reponse to bits44: The problem with simply waiting and get the A380 done is what if no one orders the A380 after these initial orders? I mean you never know, if fuel prices goes to $100/barrel chances are the demand for A380 will decrease, or what if airports charge crazy landing fees on the A380? Then Boeing would be romping away with the 787 (and 777) with absolutely no compeitor, and an updated 777 might threaten the new Airbus as well...

.

Very good point CX about the airport landing fees........

David747 · Post by **David747** » 18 Jun 2006, 00:29

Bits44, Airbus will not allow, and shouldn't allow Boeing to get more market share with the 787, that is why they have to respond to it, and, unlike some people in the industry have suggest, no concentrate just on the A380.

If Airbus has one thing going for it, it is time, and time can help company launch a successful program. The 787 proves that. Airbus taking its time to come up with a viable competitor to the 787 and 777 is all they have now. Time will tell how the A370/A370 proposals will do in the market.

bits44 · Post by **bits44** » 18 Jun 2006, 00:42

David747 wrote:Bits44, Airbus will not allow, and shouldn't allow Boeing to get more market share with the 787, that is why they have to respond to it, and, unlike some people in the industry have suggest, no concentrate just on the A380.

If Airbus has one thing going for it, it is time, and time can help company launch a successful program. The 787 proves that. Airbus taking its time to come up with a viable competitor to the 787 and 777 is all they have now. Time will tell how the A370/A370 proposals will do in the market.

I agree with you, their survival depends on them bringing a competitive product to the market, I think what the Industry is saying is be sure that what you bring is competitive, be sure you can deliver it when you say you can, and above else don't distort the facts, be honest!

The credibility of Airbus is more important at this point in time, than their products, the Industry needs to know that they can believe in what they say. They will not get any more chances.

KT

RC20 · Post by **RC20** » 18 Jun 2006, 01:29

David747 wrote:Bits44, Airbus will not allow, and shouldn't allow Boeing to get more market share with the 787, that is why they have to respond to it, and, unlike some people in the industry have suggest, no concentrate just on the A380.

If Airbus has one thing going for it, it is time, and time can help company launch a successful program. The 787 proves that. Airbus taking its time to come up with a viable competitor to the 787 and 777 is all they have now. Time will tell how the A370/A370 proposals will do in the market.

I am going to make a prediction that the A380 misses its performance specifications by at least 2.5%.

Note that one of the last test aircraft is the one that is doing the actual performance checks, while they go grand standing around with several others. Another case of a sales driven and not an engineer driven company.

At this point Airbus is going to have to make a hard decision and salvage what it can.

Unfortunately for them, that means starting where Boeing started some time back (with the777) and that’s sit down and actually listen to your customers, involve them in the early design criteria and decisions, and then follow through with an aircraft.

If they start now, they will match Boeing in technology and product offering in 8-10 years. That would mean going to an all composite airframe (per the787), and take the losses for now.

While I think Lehey is full of a lot of hot air, I think he did have it right in that they should launch the A350 as it was presented in the last iteration. All the airlines simply wanted a competitive balance (thr4aten Boeing with). I think its obvious when you see such statements as “it was a very close call, but Boeing was a bit ahead” and other ad nausea. This is followed by the “A350 was essentially a piece of junk).
While it was not a piece of junk, it also was no where near competitive with the 787 (Boeing really did have it figured out what they had to do to jump so far ahead that Airbus could not match it). There were operators willing to buy it though. It was at least a hold the line aircraft, and some like Qatar who just dislike Boeing, were willing to take it.

The hard decision is exactly where to start over again, and that really is an assessment based on listening to your “potential” customers, which Airbus is not good at. If they could, that would drive where to offer their product.

There is no way they can cover the gap (A330/A350/A340) with a single offering, so its either an equivalent copy of the 787 (and accepting that they will be so far behind that they will never get more than 25% of that market), challenge the 777 with an all composite offering (with enough low end overlap to take on the 787-10) or re-do the A320 as an all composite aircraft, and at least force Boeing to match them there.

If they dither, Boeing will beat them to that, with a product that has the advantage of the experience with the 787 to make it even better, and then they will have nothing, as Boeing can then match any move they make in the upper end.

The last thing Boeing has to worry about is the A380.

An interesting comment was found on JAL re-vamp. They dropped 747-400 service to Europe, and replaced with a 777-300. While they lost a little bit of revenue in lower passenger count, they gained 4 times as much with lower costs.

With a 787 that operates at better efficiencies than a 4 engine aircraft, that really drives the market to that type of shift, not the other way. There obviously is some requirement for the high end, but very, very limited.

David747 · Post by **David747** » 18 Jun 2006, 03:05

RC20 wrote:
David747 wrote:Bits44, Airbus will not allow, and shouldn't allow Boeing to get more market share with the 787, that is why they have to respond to it, and, unlike some people in the industry have suggest, no concentrate just on the A380.

If Airbus has one thing going for it, it is time, and time can help company launch a successful program. The 787 proves that. Airbus taking its time to come up with a viable competitor to the 787 and 777 is all they have now. Time will tell how the A370/A370 proposals will do in the market.

I am going to make a prediction that the A380 misses its performance specifications by at least 2.5%.
Time will tell on that one.

At this point Airbus is going to have to make a hard decision and salvage what it can.
I agree, what Airbus needs to do is rethink its long term strategy as Boeing did the past several years.
Code: Select all
Unfortunately  for them, that means starting where Boeing started some time back (with the777) and that’s sit down and actually listen to your customers, involve them in the early design criteria and decisions, and then follow through with an aircraft.  
Right, it worked for Boeing very well in the launch of the 787 program. The Sonic Cruiser was probably a blessing in disguise, here is a plane that Boeing tried to market with composite fuselage, etc, when customers said no to that plane, Boeing studied its long term strategy and came back with an airplane that has not only won orders from customers, but could very well be a game changer in the industry. Airbus should take a page from Boeing and rethink its strategy.

While I think Lehey is full of a lot of hot air, I think he did have it right in that they should launch the A350 as it was presented in the last iteration. All the airlines simply wanted a competitive balance (thr4aten Boeing with). I think its obvious when you see such statements as “it was a very close call, but Boeing was a bit ahead” and other ad nausea.
John Leahy underestimated the 787 by saying that the A330 could be competitive against it if only they added new engines and new wing. I can't think of a derivative of an existing program doing well against a new airplane in the market. Maybe someone here does. Anyways, the point I'm making is that Airbus should have answered Boeing with a brand new airplane, had they taken the 787 seriously, and when they did see the 787 selling, they came up with the A330+20, which as we have seen, has been rejected by most important companies, except ILFC, and even them expressed reservations on it.

The last thing Boeing has to worry about is the A380.

Boeing at the moment is not, but if the A380 does become a benchmark in the industry, Boeing will be in trouble. How much trouble, time will only tell.