Monday, November 19, 2007

AIRBUS A380 Takes off !

As I write this post on AIRBUS A 380’s maiden flight, I would like to go back to my TAPMI days wherein we discussed the A380 case study as part of the project finance case. This case study described the way A 380’s project has been organized and what kind of issues the company can face (It did face a lot of issues !).

At this point in time, I would also like to talk about the other blog entry which I had posted earlier in which the delay in AIRBUS A380 delivery was mentioned. AIRBUS A 380 delivery to airlines was delayed by close to 18 months which resulted in AIRBUS paying huge penalties and fines. Because of AIRBUS A380 the parent company EADS and AIRBUS both went into a lot of trouble which resulted in restructuring of the business and operations.

A380 which took close to a decade in the making and is about two years behind the delivery schedule, made its first commercial debut for Singapore Airlines flying from Singapore to Sydney with more than 450 passengers aboard. People were so excited about the first journey that they were spotted wearing T Shirts which said “I am First to Fly A380”.

For Boeing, it’s truly a gauntlet and kicks off a new round of multi billion dollar contest between the rivals for jets which will serve the long distance travel.

A380 has a price tag of about $ 300 million and if the plane is completely occupied with coach seating it could carry a whopping 850 passengers. The logic behind building such huge jets lies in the fact that major airports would become congested by huge number of aircrafts and it will be important to have large planes which can carry more passengers than the existing ones.

People have described the first commercial flight of A380 as a moment in aviation history. A few tickets for the suites within the aircraft were auctioned on e-bay and a Sydney businessman bid $ 100, 380 for two of the 12 luxury suites. This speaks of the excitement which people had for traveling in jet.

In Singapore, passengers began to arrive at the airport at 4:30 a.m., anticipating long lines, but the average wait for check-in was 15 minutes and people breezed through security. At the gate, they were treated to a buffet of breakfast pastry and canapes as a string quartet played classical music.

The new jet for Singapore Airlines was configured for 399 people in economy, 60 in Business class and 12 in Suites. There were 33 in flight crew, including four pilots and the journey time was just over seven hours. On the main deck similar to Boeing 777-300, there are 10 seats in each row with four in the middle and three on either side. In the narrower upper deck, eight seats make a row in economy with four in middle and two on either side. Business class seats on upper deck were arranged in pairs in three rows.

Surprisingly of the 468 passengers, 75 were newspaper and TV Reporters.

Passengers snapped pictures of each other several times in various parts of the plane including the spiral staircase and even restrooms. Media brought in a party atmosphere and interviewed a large chunk of people in the business class.

On October 17 2007, when Singapore Airlines CEO Chew Choon Seng took delivery of the A380, he described it “The new queen of the skies”. But whether A380 will redefine the air travel the way Boeing 747 did remains a question.

Airbus has over 165 orders for it’s A380 Megaliner as against 700 Dreamliners for Boeing 787. But Airbus expects to have a second round of orders post its commercial operations of A380 take shape.

Problems assembling the A380 drove up the development cost from an initial $12-billion estimate to nearly $20 billion. That led to a major shake-up at Airbus that included the ouster of several top executives. This became a major issue in AIRBUS and the project A380 looked like a distant dream and most of the airline companies asking for heavy compensation from AIRBUS.

Boeing's 787 Dreamliner hasn't been immune to problems. In an embarrassing setback, Boeing said in October that shortage of parts would delay the first delivery by six months.For Singapore Airlines, the decision to fly the A380 on the Singapore-to-Sydney route was strategic. The airline has been in a battle with British Airways and Qantas to fly the lucrative route that connects travelers from Europe and Australia. Before jets, propeller planes from Europe had to make numerous stopovers to reach Australia. Because of the "hops" involved, the trip became known as the Kangaroo Route.

These days, a flight from London typically stops over in Singapore before proceeding to Australia, and vice versa. Singapore Airlines hopes the introduction of the A380 will help it lure passengers, particularly first- and business-class customers, away from competitors.The test will come Sunday when the Megaliner enters regularly scheduled service that will require a landing, unloading of passengers, cleaning of the cabin, restocking of meals, refueling, loading of passengers and taking off -- all within just two hours that too on a daily basis.