Lufthansa orders A380

[Vortex what...ouch!]

From the BBC:

"German airline Lufthansa has decided to go ahead with an order for 15 superjumbos from Airbus, a decision it postponed in the immediate aftermath of 11 September.
"
http://news.bbc.co.uk/hi/english/business/newsid_1695000/1695032.stm

[recceguy]

hey guy we started the same topic (virtually) at +/- 1 minute, from different countries !
to other people : I don't know this gentleman, and I don't work for Airbus !

It has been some time since I heard for the last time about the Sonic Cruiser from Boeing Systems

[casual observer]

Since when Boeing changed its name to Boeing Systems (like BAE Systems) :confused: ?

Some would argue that an airline like LH is "forward looking" by ordering much larger planes when they are experiencing a (short-term) traffic contraction of more than 15%. Some might suspect that LH is "asked" to show their support of their national industry (remember Weber had stated more than a year ago that he didn't see LH needing the A380). Which is the more likely scenario? I'll let you decide.

[jongar]

or post 911 they got a better discount to keep the 380 plan online

[Claret and Blue]

Rumour is that Airbus are undercutting Boeing's 747-400 prices with their A380's and that's not the "sticker" price but undercutting Boeing's preferred customer rates. Heard discounts off full sticker price of 50% plus!

[Squawk7777]

here's what I found in the Financial Times...

Lufthansa, Europe's second-largest airline, on Thursday placed a long expected order for 15 Airbus superjumbos, providing a boost to the aircraft maker for its ambitious $10.7bn project at a time when the industry is in crisis.

The order, which at list prices would be worth $3.7bn, comes at a delicate time for the German carrier, as it continues to seek agreement from two of its three main employee groups in a bid to cut labour costs by 10 per cent.

But the importance for Airbus of securing Lufthansa as a customer for the aircraft, means the German airline is likely to have secured similar terms as the other eight A380 buyers, which were offered significant discounts.

The Lufthansa order brings the total number of firm commitments Airbus has won for its revolutionary, 555-seater, double-decker aircraft to 97, in line with the manufacturer's end of the year target.

Shares in EADS, which owns 80 per cent of Airbus, rose 82 cents to E14.60 in Paris. BAE Systems, which holds the remaining stake, was up 1-1/2p at 306-1/4p in London.

The timing of the order for the German airline, which shelved plans to place the order in September as it issued a profit warning in the wake of the terrorist attacks, could have been better as talks with the pilots and ground crew continue.

The carrier described the decision to buy as "a counter-cyclical investment" for the long-term - the first aircraft is due to arrive in the third quarter of 2007. It highlighted the expected 10-15 per cent cost savings that Airbus has promised the A380 will offer over today's jets.

Lufthansa last week won agreement from its cabin crew on concessions, which include measures such as a four-day working week, pay cuts and early retirement. Agreement with the pilots and ground staff is thought to be close.

The order offers a welcome glimmer of optimism in an industry, which has been badly shaken by the fall-out from the September 11 attacks in the US. Although passenger numbers are beginning to show signs of recovery, they remain about a fifth below last year's levels.

Airlines, which have also been further burdened by additional security costs, have shed more than 120,000 jobs as a result.

Lufthansa has so far avoided job losses in its core airline operation, but warned in early November it would have to make about 4,000 of its 70,000 staff redundant if the unions did not agree to its cost-cutting.

Lufthansa said full implementation of its emergency recovery strategy could still allow it to avoid an expected E400m ($353m) loss for the year.

[casual observer]

V50:

Discount or not, this is a very trying time for most of the airlines. No one is certain when the industry will turn around. Committing to such a big investment at this time is very questionable for a reputable airline like LH.

[ 07 December 2001: Message edited by: casual observer ]

[yowie]

Surprised that Airbus are pushing ahead in light of recent events.How many original customers are going to be in business when delivery time comes around? :confused:That alone being able to afford a new type and 550 seats!

[ 07 December 2001: Message edited by: yowie ]

[Heliport]

We criticise the 'prophets of doom' in the Press, yet make cynical comments about those who, at a difficult time, demonstrate confidence in the industry.
Odd. :confused:

[recceguy]

Yes, Sir Moderator, some pilots apparently have also business and management degrees, and they can see in the future too...
It's funny how people start to feel unease when reading about A380 successes - but no worry, the same was heard at the beginning of the A300, then again for the A320 :D

[Best Western]

LH probably want them to compete on Hahn - Pescara against FR in the mornings, then MUC STN in the afternoons against GO.

[casual observer]

Heliport:

There is something called fiscal accountability, especailly for a publicly listed company like LH. At a time when you have persistent daily negative cash flows, is it wise to make downpayments on an aircraft that assume the air travel would grow healthily in the future? No matter how small the downpayments might be, it is still additional drain on your cash flow.

Furthermore, the tragic Sept 11 event has resulted in more than 20% reduction in trans-Atlantic and trans-Pacific traffic. It will take at least two to three years to get back to where we were prior to Sept 11. With an airline like Emirates that want to expand like crazy, I think Singapore and Qantas will have their hands full when all three of them put their A380s on routes between Australia and Europe. I think they will have a hard time maintaining their yields.

[Roc]

From what I understand the roll-out date for the A-380 will be sometime in 2006, if, there are delays in the program your talking 2007, alot can change till then. I'm sure the airline crisis will be over by then and these purchases may seem wise in hindsight.

[GeofJ]

Airbus is undercutting Boeing's 747-400 with pricing for the A380 - either Boeing is way overcharging or Airbus is going to be pouring money down the rat hole on these deals. I thought the idea of developing new aircraft was to make a profit?

[recceguy]

So once again :

It's funny how people start to feel unease when reading about A380 successes - but no worry, the same was heard at the beginning of the A300, then again for the A320 :D :D

and from what I read in another forum, you can already drop in the basket the pictures of the 0.98 Sonic Thing from Boeing Systems we saw some months ago. If they really consider M1.8... they will have to start everything again :D

and I remember flying in aircraft at M2.2, and they were not liners, and they were not american design.. :cool:

[Roc]

Recceguy,

Your correct to say the A-320 is a sucess, however to say the A-300 is/was a sucess is wrong! Commercialy the A-300 has not been a profitable aircraft, Airbus hadn't sold more than 50 for the first 10 years or so until they literally "gave them away for free to Eastern airlines" If they hadn't given them away to UPS the assembly line would be shut down. I guarantee you that it has not made a profit! I believe approx 500 were sold since 1973, Douglas sold a similar amount of DC-8's over a 15 year production run and lost money! as well a with DC-10 production as well, both aircraft never made a profit for Douglas!! But if you look at it from the perspective that it employs many people and allowed the development of the other Airbus jets, you may say it was a sucess.