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Airbus Loses Altitude

Remember the smug Euro-weenies when the Airbus A380 first flew? Some of the French declaring it the "Post Boeing" era. Well, what a difference a year makes.

The same Superjumbo A380 that brought them such pride is now an albatross around the company's neck. Production delays have pushed back delivery dates by over a year and have cost Airbus over 4 Billion dollars. And that number continues to climb as more customers demand compensation for delivery delays.

Airbus CEO, Gustav Humbert, got resigned after the delays were announced and Airbus parent company EADS is in all sorts of trouble. Tales of insider trading and political infighting have shaken the company - and its share price. The French are blaming much of the problems on the Germans while the Germans are blaming the French. (Who would have imagined that happening? ;-)

Now, just a year after the A380 first took to the air, the Euro-weniees have a little less to be smug about.

Airbus orders fall behind Boeing
European aircraft maker Airbus has fallen behind arch US rival Boeing in the number of new orders for planes.

The firm's chief commercial officer, John Leahy, told the BBC that Airbus orders were currently running at "about 20% or 25% compared to Boeing".

However, he insisted that the firm remained on course to deliver more planes than Boeing this year.

Airbus has been hit by production setbacks with its giant A380 jet and senior management problems.

Until recently, the firm had been leading Boeing in total passenger jet orders.

But reports on Wednesday suggested that Airbus orders for the first six months of the year would be in the region of 145 to 150 planes, compared with about 450 at Boeing.

Additionally, the airlines have turned up their nose at the initial designs of the A350 and have embraced the fuel efficient Boeing 787 which is an aircraft Airbus simply has no competitor for. The A350 project is in such trouble, the new CEO of Airbus has not committed to it yet and may not. If he does commit to the project, it will represent a mammoth roll of the dice both in terms of the marketplace and his ability to reform the company so they can actually deliver the product.

The airlines will work with Airbus because the last thing they want is a monopoly, the current duopoly is bad enough. Look for a large number of orders to be placed in the next few months. The problem is that Airbus can't fulfill their current orders.

If fuel prices stabilize or retreat and the new CEO can refocus the company, Airbus can rebound. But today it looks like things are going to get worse before they get better.

Ironically, it was the quest to be the biggest -the very thing the Europeans despise Americas for- that was their downfall while the efficiency of the American product is what is winning for Boeing.


Comments (16)

The Airbus people also vast... (Below threshold)
hermie:

The Airbus people also vastly miscalculated the simple fact that airports would have to drastically change some of their terminals and boarding areas to accomodate the double-decked planes. Most airports of course, have no funds to do that kind of construction.

Hmmm.There's a lot... (Below threshold)
ed:

Hmmm.

There's a lot of issues with Airbus and it's aircraft. And some issues that might come up with Boeing.

1. Composites.

Frankly I'm still a bit iffy on these things. The USAF has a policy of 50 hrs of maintenance per 1 hr of flight time. This is because carbon composites are really glued fabric. And when aircraft fly high and fast the carbon composites are subjected to a multitude of temperature ranges and moisture levels. One basic problem with carbon composites is if moisture penetrates into the composite matrix. At high altitude the cold temperatures can turn this moisure into ice and thereby cause a separation in the fabric layers.

So the USAF uses specialised imaging equipment that'll detect this penetration of moisture and examines every single square inch of aircraft like the B-2 which uses composites extensively.

I believe the standard for commerical composite aircraft like the Airbus is for *visual* inspection. And from what I've read and been told a visual inspection won't tell you anything about the state of the interior carbon fibers unless the damn thing is ready to fall apart.


2. Safety of composites.

Not that long ago an Airbus jet basically fell apart on Long Island and crashed when it's *rudder* fell off. This was marked as "pilot error" because the pilots tried to regain control by flapping the rudder back and forth and evidently that cause the rudder to just fall the hell off.

It also bothers the heck out of me that some professional airline pilots won't fly Airbus jets.


3. This same stuff could happen to Boeing's new 787 so we'll have to keep an eye out.


4. There was always something fairly silly about the A380. In it's luxury configuration it handles about 550 passengers. In it's economy configuration it can handle about 850 passengers. But just to handle the aircraft every airport would need about $10m-$20m worth of runway upgrades to handle the weight. And a brand new terminal that is designed just to handle the A380 because it's dimensions are so different from other aircraft.

On top of that the expense of flying the aircraft would require hub-to-hub travel in order to ensure that there is a minimum number of empty seats. Something that a lot of people would prefer to avoid since flying hub-to-hub often results in flight delays and long layovers with frequent losses in luggage. Boeings idea of regional airport to regional airport sounds a lot better because the major hub airports are already congested far beyond their practical maximums and shifting more traffic to regional airports would allow for more traffic overall without making major airport congestion even worse.

Then there's the issue of trying to find your luggage along with 549 other passengers and going through customs with them as well. Or going through airport security with that mass of people. Or even getting on and off the airplane. It's sometimes tough getting 150 people on a widebody jet and getting the hell off the ground. Trying to get 550 to put away their carry-ons and sit the hell down would be a nightmare of epic proportions.

Especially if my father were one of them. :)


5. I've read that the redesign of the A350 would probably cost about $8b. Which seems unlikely that Airbus could afford that without the A380 selling better so that it'll recoup it's design costs. So it's likely that Airbus would have to go to the principle owners of EADS, i.e. some of the governments of the EU, for "loans" or outright grants of money.

And that's going to be a real pissing match then because Boeing and the US government is already pretty angry about the level of open-ended financial support given to Airbus by the government owners of EADS/Airbus. If there is a substantial grant or "loan" given to Airbus I think we can expect a serious challenge at the WTO and very real possibility of a trade war.

The amount of money that Airbus will need for the redesign of the A350 and the design of the A370 is going to be really massive and just far too big to ignore.


6. In hindsight it's funny. But the corporate structure of Airbus is pretty psycho. There are actually *two* companies within Airbus. There is a French company and a German company. Each has it's own CEO. It's own Chairman. It's own set of executives. Which is why the French CEO had no idea what the hell was going on in the German wiring plant.

IMHO it's one thing to screw up. It's another thing to screw up because Airbus offered too many entertainment options in their aircraft. In effect each A380 purchased requires a completely custom wiring harness to deal with the specific entertainment options selected by the customer and so each wiring harness has to be designed and made from scratch.

...

As always. When the French are involved, silliness abounds.

I always felt that the A380... (Below threshold)
langtry:

I always felt that the A380 wasn't going to be a threat to Boeing. Besides all of the points you have made above, Paul, the A380 required special accommodations. Airports can not service an A380 with the equipment the use to service a Boeing 777, 767, 747, etc., nor can equipment for the 2nd largest of Airbus aircraft (the A340) be used. The A380 requires its own specific gate, jetway, etc. Disembarking the A380 would require two levels of jetways, adding tens of millions of dollars to the terminal renovation costs the purchasing airline companies would have roll into the the A380's purchase price (with carriers like United, British Airways, and other carriers adopting austerity measures in the wake of 9/11 this is not a good thing). Delays that were common to the 777 during its first years of service, as there weren't enough gates at many airports including Chicago's O'Hare that could accomodate it's size, are a given. For example, if the Lufthansa 747 occupying its gate was delayed for any reason *which was almost all the time* you sat in the "penalty box" off the tarmac until that plane taxied out for departure or transition to the International Terminal. That's a lot of unhappy passengers who will not be making their connections.

American airports are also limited in their ability to extend their runways, which the A380 would require in many instances. That's not a problem if you're talking about China, where the government has the power to move your neighborhood without having to worry about equitable compensation for loss of property or due process of law, but that's not going to work in the U.S. or Europe.

To be frank, I don't think anyone who flies was ever crazy about the A380. Despite Airbus' P.R. campaign and the display of bedrooms, bars, and ultra-first class accommodations, I don't think anyone expected to see that type of service when they would fly the A380. The 'Dirty Little Secret' about the A380 was that you'd likely fly in a traditional 2- to 3-class configuration with 90% of the passengers flying economy/coach. That's at least 650 passengers (IIRC) having to board, occupy and disembark in an orderly fashion (let's not even get into how difficult it will be to safely evacuate an A380 in an emergency) Talk about feeling like cattle!

Calling the A380 an Albatross is too kind: the A380 is the SST/Concorde of the 21st Century: an impractical, expensive to operate 'vanity' product that the British and French Governments would be required to prop-up for the duration of its utility. As those same governments are asking their citizens to give up decades of social programs and other forms of assistance, I don't expect quiet acquiescence in order to support a ugly and exhorbitantly costly airplane. I expect to hear a scaling-back of the A380 program, the sooner the better.

ed, you say:"The U... (Below threshold)
Jay Tea:

ed, you say:

"The USAF has a policy of 50 hrs of maintenance per 1 hr of flight time."

Did you get that backwards, or is the upkeep on composites that hideous? No freaking wonder they cost so much...

J.

Ed: That's a good summary. ... (Below threshold)
Cousin Dave:

Ed: That's a good summary. I have some questions about the composite thing too. I'm sure that issue is going to get a lot of attention between now and when the 787 achieves certification.

One other financial liability that hasn't been discussed in this thread: BAE Systems (the artist formerly known as British Aerospace) owns 20% of Airbus. Recently, they exercised their contractural right to compel EADS to buy their Airbus share out. Now EADS has to come up with billions of euros to do that. Given EADS's cash-strapped situation right now, they only have two options: (1) get a subsidy, with the previously discussed political risks, or (2) issue a bunch of new EADS stock, thereby diluting the existing stock.

The Venture Star SSTO was k... (Below threshold)
The Listkeeper:

The Venture Star SSTO was killed when Lockheed discovered that you can't make a reliable cryogenic fuel tank from composites because of ice-induced delamination.

Listkeeper: I don't think t... (Below threshold)
Cousin Dave:

Listkeeper: I don't think that's a comparable situation. The tank in question failed when tested with liquid hydrogen. That's a whole heck of a lot colder than anything even a high-altitutde airliner ever encounters. Plus, hydrogen is notorious for its negative effects on all sorts of materials. They composites thing in airliners is something to worry about, but not because of the VentureStar.

EU or UN the Airbus situati... (Below threshold)
Charles Bannerman:

EU or UN the Airbus situation is what you get when you let committees run the show.
The Airbus people failed to get the priorities right: which is better, to have the biggest plane or to have the biggest profits? They opted for the biggest plane and lost their butts.
Don't let your eyes get bigger than your appetite is the best way to run a business.
Chuck

It seems much harder in Eur... (Below threshold)
K:

It seems much harder in Europe to change a cooperative agreement or a management stucture than it is in the US. Airbus (at least to many Europeans) is their poster child - the venture that shows the ultimate triumph of niceness over capitalism.

Airbus engineers are fully as good as Boeing's. Material, machines, money, and infrastucture are just as available. Boeing designs planes with French software.

Boeing spent almost a decade digging out of messes they made around 1994. They made management and organization changes, observed, and then made more. I think Airbus is now in the same fix and needs the same remedies.

Hmmmm.Did... (Below threshold)
ed:

Hmmmm.

Did you get that backwards, or is the upkeep on composites that hideous? No freaking wonder they cost so much...

From what I understand the the SOP was originally about 100hrs of maintenance per 1hr of flight time for the B-2 entirely because that aircraft is almost completely carbon composite and because imaging technology hadn't improved enough to make inspections easy.

Since then the requirement has dropped to about 50hrs maintenance per 1hr flight time for the B-2 because of better imaging technology, coupled with robotics to simplify usage, that allows for a complete inspection throughout the entire thickness of the carbon composites.

The issue of separation of the carbon fabric layers, or delamination, is a potentially significant problem. Primarily because carbon composites only retain strength when completely intact. If there is any significant amount of delamination then the structural strength of that carbon composite is pretty much shot and the thing will just thrash itself apart.

How this will affect commerical aircraft I'm not sure except that aircraft maintenance and inspections is generally done by the airlines or their maintenance contractors. I think it'll be too much to hope that these groups have the necessary equipment to fully inspect the composite's entire cross-section except on a pre-planned cycle. So if significant delamination begins in the middle of such a cycle then that might cause a crash.

Then there's the uncertainty on how carbon composites age as they cycle through hundreds or thousands of takeoffs and landings, rising to and from 30k feet and so forth. A prime example of what can happen unexpectedly is the De Havilland Comet, the first jet passenger airliner.

http://en.wikipedia.org/wiki/Delamination

IIRC, the Comet suffered fr... (Below threshold)

IIRC, the Comet suffered from metal fatigue, exacerbated by square corners at the windows, which tended to concentrate stresses from thousands of pressurization cycles.

As far as the B-2 goes - you pay a billion bucks for a plane, you're gonna be REEEEEEEL careful with it. I wouldn't be surprised if they clean the engine blades with q-tips after each flight.

The problems of the engines... (Below threshold)
serfer62:

The problems of the engines over taxiway and runway lights means it can't come to most airports either since the craft will just blow them down...

re: The Comet suffered, etc... (Below threshold)
K:

re: The Comet suffered, etc.

Yes. And it was a disaster for British industry which was really doing some good things trying to recover from WW2.

Few will remember that the Comet windows and metal fatigue was corrected and the plane served well for decades. I think the last one was in airline service until about 1980. But their reputation and substantial lead was gone.

JLawson is right. They are real careful with the B2s. I worked on them briefly (along with 40,000 others). They get AC hangars, humidity control, avoid sunlight, etc. However several parts of some Navy fighters are composite. And they can take a beating although I don't know the maintenance cost.

Well, I can't comment on th... (Below threshold)

Well, I can't comment on the maintenance of those planes, I DO know that the military has extreme strict maintenance standards. They over-maintain so that in the advent of supreme action, very little is left to chance that can go technically wrong. Of course, they also have many, many extra people and I believe that number may be total man-hours, not time-specific (e.g. 5 men working ten hours = 50 hrs). On the last ship I was on, the USNS Mt Baker, the helo detachment assigned to us had that sort of maintenance going on, they were ALWAYS doing something to the not-running helicoptor. Here on the USNS Saturn, we have a civilian contracted helicopter crew and they only have 3 maintenance engineers (while the navy had a crew of 10-15 or so).

A couple comments regarding... (Below threshold)
Wanderlust:

A couple comments regarding a) composite maintenance, and b) military vs civilian equipment readiness:

I used to work at Boeing's helicopter plant in PA a few years ago. At the time, the plant still had a Center of Exellence for composite parts - for example, the rotor blades for the CH-47 Chinook are completely composite, with only a metal bearing sleeve where the blade attaches to the rotor hub, and an internal tungsten weight for balance. By comparison, other composite helicopter blades (other manufacturers) had to have a metal shaft that attached the rotor to the hub. This metal hub attachment causes flexing in the blade that degrades the life of the composite material.

Meanwhile, I also saw the beating composite blades take for a variety of reasons: mainly due to bullet holes and sandblasting (desert operation). Once the composite laminate is holed, water quickly enters the structure; hence, moisture delamination was usually what caused CH-47 rotor blades to be shipped back to PA for repairs.

That being said, perhaps the most acknowledged authorities on composite airframe structures in the industry are the Rutan brothers (and by extension, their company, Scaled Composites). Recall that although most of Scaled Composites aircraft are "experimental", the Rutans were heavily involved with the (then-Beechcraft) Raytheon Starship pusher prop composite passenger aircraft built in the mid-1980's. IIRC, there were 50 or so of those aircraft manufactured, and the ones still in service have excellent performance records.

As for the difference between military and civilian readiness, two items:

* Military equipment use tends to be in "burst" mode: a lot of waiting, then sudden intense action, with loads that frequently stress the airframe; by comparison, most civilian equipment use is more "steady state" use, where the equipment is used under nominal loads for many hours per day. These use profiles require very different maintenance programs, and application of the one to the other can have dire consequences (e.g., failures of UH-1 slicks put into civilian use after being retired from military use).

* Military measures of economy are mission-oriented; whereas civilian/corporate economy measures are ROI oriented (financial). Therefore civilian readiness rates must, by definition, be far higher than military ones. For example, Petroleum Helicopters, Inc. (Lafayette, LA) operates the second largest fleet of helicopters in the world - second only to the US Army in size. Its readiness rates are usually around 98% vs. the Army's nominal 80% rate (figures may be a bit off; were accurate in 1997 when I interviewed at PHI). PHI's readiness rates are absolutely essential for a company that operates very expensive equipment on close margins. Or, as Herb Kelleher once told his troops at Southwest years ago, the [planes] only make money when they are airborne. Civilian operators simply cannot afford "hangar queens".

BTW, changing subject, another reason the B-2 requires so much maintenance is its RAM (radar absorbing material) coating. That crap is HEAVY, and the B-2 is completely coated in it. Access to service hatches requires cutting holes in the RAM coating and then repatching it. That process alone is very expensive and time consuming.

Oh, one comment re Boeing v... (Below threshold)
Wanderlust:

Oh, one comment re Boeing vs Airbus at WTO: Airbus' case is usually that Boeing's military work gets it development and research money that amounts to "government support" of the company. IMHO, this argument fails on three counts:

1. To get that development money, IDS (Boeing's Integrated Defense Systems division) must develop something with the money that has a military application. If the application becomes dual use, the civilian use is incidental to the project. Direct "no-interest" loans and loan guarantees by EU governments to Airbus come with no such requirement - simply use the money on whatever civilian aircraft is being developed. In essence, these funds are free loans to the company, usually at taxpayer expense.

2. EADS is to Airbus what Boeing's IDS is to BCA (Boeing Commercial Aircraft). The difference is only in Airbus/EADS byzantine corporate structure.

3. Airbus is a national entity to its member governments. As reported in the press, high-level positions at Airbus are essentially political appointments. By comparison, Boeing is a public stock company, with little to no direct investment by the US Government.

That being said, I don't want to see Airbus go away. I do, however, want Airbus to play fair regarding WTO regulations, and for once in its life compete as a public company, not as a ward of its member states.

Meanwhile, I imagine that many of my former acquaintances at Boeing are quietly smiling an "I told you so" smile regarding A380's financial woes. It didn't take a rocket scientist or a Harvard MBA finance whiz to determine the financial fate of the A380: all one had to do was look at the cost of infrastructure improvements required at airports to support A380 flights. IIRC, only 15 major airports WORLDWIDE will spend the $1.5B+ to allow the A380 to operate. Someone's got to pay for that, and it will eventually be airline ticketholders, shareholders, and taxpayers. That's assuming airports even have the room to expand (mentioned above by another commenter; that room simply isn't there anymore at airports in Western countries). Back in the day of the 747, room was still available, and the cost of infrastructure improvements was justified by the drastic reduction in wait times.

Then again, the Concorde was a lovely aircraft as well - as long as it could fly supersonic on flights of 4,000mi or less. By 1978(?) most Western countries banned supersonic flights over land masses, and flights to the lucrative Asian market from the US West Coast were beyond the operating range of the aircraft. As a result, the only corridor that the plane could operate on was NYC to London or Paris. The plane operated for only 7 hours a day in revenue service, and its fuel costs were several times higher per passenger mile than the 747.

I predict that A380's only hope for profitability in the future is a focus on either freight operations, or conversion to military use.




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