Qantas & the A380, will it work?

[UP4014]

Not sure what the contract says, but Skymark did walk away at a very late stage...psst want a cheap A380 ??

From what the industry mags said it was Airbus who cancelled the order as Skymark didn't have the money, nervous bankers maybe. I think one even got painted in the Skymark colours.

Matt

 

[jb747]

Were Airbus right to build it...almost certainly not, but, it works extremely well for some specific airlines and routes. Personally, I think QF could make good use of a couple more, but beyond that, 350 or 777X.

747-8, whilst a nice aircraft in itself, offers little over a 777.

 

[phill84]

So they don't have to take up the option & buy those remaining four?

Qantas ordered 12 with 12 more options in November 2000, then converted 8 of the options to firm orders in October 2006.
12 have been delivered, 8 were pushed back to 2018 and beyond. Technically there are 4 more options.

 

[markis10]

So they don't have to take up the option & buy those remaining four?

Options mean exactly that, optional purchases.

 

[RooFlyer]

My 2 bobs worth.

Seems to me that the A380 was made for Qantas like no other airline. QF has a high percentage of base load of customers wanting to go long distances - to LHR and USA in particular. These aren't hourly departure destinations. So a whacking big, commodious, efficient per-long-haul-passenger aircraft seems just right; ones that can plough back and forth carrying the burden. But only for base load.

Beyond that, it appears they need some mid sized, more flexible medium-long haul craft. Like 777.

 

[moa999]

My 2 bobs worth.

Seems to me that the A380 was made for Qantas like no other airline..

I think history will show - the A380 was made for EK
It happens to work for QF

Agree with jb747 that a 777W/350-10 would be great, but suspect a 787-9 will have to do

If a second-hand market appears for the A380 (potentially QF could offload to higher weight or A380-neo aircraft)

 

[dajop]

Wonder how its going for the "prestige" operators? Surely it's costly to introduce and maintain the aircraft and appropriate certifications when you are only operating 4-6 of the type. But there are some airlines who do seem to want to operate as many types of aircraft as possible (eg. TG).

Also be interesting to see how it works out for Transaero, with their 650 config. aircraft. Read some articles suggesting (eg from Sandilands) about them packing them in like sardines, but in reality with only 12 first and 24 J seats the Y cabin doesn't seem any more packed than most other operators.

 

[Sprucegoose]

So they don't have to take up the option & buy those remaining four?

An option is just that. Generally you pay for the privilege of having an option depending upon the commercial circumstances.

 

[jukebox333]

An option is just that. Generally you pay for the privilege of having an option depending upon the commercial circumstances.

Indeed. I seem to remember when the MX5 first came out (late 1980's?), availability in the USA was so scarce, Mazda dealers there were selling options to buy these at a price approching the sticker price of the car itself.

 

[Sprucegoose]

Indeed. I seem to remember when the MX5 first came out (late 1980's?), availability in the USA was so scarce, Mazda dealers there were selling options to buy these at a price approching the sticker price of the car itself.

Now that's an example of an expensive option !!

 

[samh004]

You work with what you're given.

Going forward though, I hope Qantas is able to ink a good deal on those 787-9 options it has, maybe throw in some 747-8i at a good price too, to help with some the gap between now and delivery. They use the 747 on a lot of routes so a reduced operating cost would come in useful.

Optionally, perhaps some 777's too, but like the 787-9's I think there will be a gap and they could really do with some new aircraft now to cover them and the 747-8i would provide the efficiency they need and range they already rely on.

 

[Himeno]

The 747-8 currently has a 2 year build queue at their current build rate and order list. If QF ordered some today, they'd arrive in mid-late 2017, when their 787-9 options are available and a few months before the remaining A380 order starts arriving (unless deferred again).

 

[samh004]

The 747-8 currently has a 2 year build queue at their current build rate and order list. If QF ordered some today, they'd arrive in mid-late 2017, when their 787-9 options are available and a few months before the remaining A380 order starts arriving (unless deferred again).

Well there goes my great plan!

 

[Himeno]

So they don't have to take up the option & buy those remaining four?

An option is just a small payment to hold a delivery slot for a period of time. They have to decide by that time to convert the option to a firm order or lose it.

 

[markis10]

Well there goes my great plan!

Not necessarily, jumping queues is a tactic that Boeing have used in the past to get a sale.

 

[Aussie_flyer]

I think this year we will see the delivery date of the remaining 8 x A380's announced and 787-9's deliveries confirmed from 2017. I don't see any 747-8i's or 777's coming.

 

[bismarck]

Not sure I see the business case for a 748.

The 388 seems appropriate for their LHR/US flights while the rest would seem more suited to a 789 or 350.

Unless ETOPS is an issue for JNB/SCL. Not really sure what to do about those.

 

[RooFlyer]

The 747-8 currently has a 2 year build queue at their current build rate and order list. If QF ordered some today, they'd arrive in mid-late 2017, when their 787-9 options are available and a few months before the remaining A380 order starts arriving (unless deferred again).

Unless they found some-one with 747-8 orders or options willing to defer or cancel, or even to buy out (unlikely, but possible if QF suddenly became hot to trot on 747-8)

An option is just a small payment to hold a delivery slot for a period of time. They have to decide by that time to convert the option to a firm order or lose it.

As a general comment on these options. A number of years ago, in my investment banking phase, I had a look at a couple of airplane purchase option agreements (buyer was a large aircraft leasing company) as apart of a financing deal. Good grief. Not so much complicated as byzantine. If you traced the various permutations and combinations, there were about 15 different outcomes (delivery dates, aircraft numbers and prices lose/gain discounts etc etc), depending on circumstances, currency etc. IIRC, there were even a couple of 'put' type clauses there (where the aircraft maker held the option to sell the aircraft to the buyer, but the likelihood of those crystallising seemed very small). Our risk management people also had a look - and concluded that after all that paper and lawyers, it amounted to a vague agreement to talk about selling/buying an aircraft or dozen sometime in the future.

 

[samh004]

Not necessarily, jumping queues is a tactic that Boeing have used in the past to get a sale.

I'm still putting my money on this option then, as they are a bit short on aircraft at the moment and would probably prefer a 747 for JNB/SCL.

 

[markis10]

I'm still putting my money on this option then, as they are a bit short on aircraft at the moment and would probably prefer a 747 for JNB/SCL.

Not too short, they still have John Farnham in the fleet (OJA)