[260520.EN.AIR] Emirates Faces Dilemma Over What To Do With Too Many A380s

DUBAI airline Emirates will retire a number of its jumbo A380 fleet as big planes become white elephants in a world with fewer long-haul flights than ever, reports Bloomberg.

Emirates has a fleet of 115 A380s and eight more due for delivery through 2021, of which it's looking to cancel five in discussions with the manufacturer, people with knowledge of the situation have said.

The carrier has already restructured the contract once, reducing a follow-on order by 39 aircraft in February last year as Airbus moved to wind up the programme amid a dearth of other buyers.

That deal saw Emirates top up on other Airbus jets, but in the current climate that's not an attractive option. With production of the last A380s well advanced - the final set of wings was shipped from the UK to the superjumbo assembly line in Toulouse three months ago.

Failure to take delivery would trigger penalties of up to US$70 million per plane. Airbus is instead offering to defer deliveries or payments, according to Bloomberg sources.

Emirates President Tim Clark said in September that the company had begun standing down older A380s and that the fleet size might fall to 90 by the mid-2020s, implying that about 30 might go.

Emirates leases 59 of its A380s, which Mr Clark has indicated may be returned as operating terms expire, but owns 56. The catch is that unlike almost every other passenger plane, the A380 has won no second-hand market as carriers baulk at its 450 seat-plus capacity and thirsty four-engine design.

Source : HKSG.