British Airways is willing to buy more Airbus A380s…if the price is right.
Last week, we learned that Emirates is exploring switching some of its A380 orders to smaller A350 or A330neo aircraft. The move would likely sound the death knell for the A380 program, which has simply failed to pick up more customers in recent years.
But at a oneworld event in London, IAG (parent company of British Airways and Iberia) CEO Willie Walsh suggested a “clear” solution:
I’ve been very clear with Airbus that if they want to sell the aircraft, they’re going to have to be very aggressive on the price.
In many ways, Airbus has already given up on its A380 program, which has been a cash drain. It is facilitating discussions with Emirates on the A330/A350 transition and some say Airbus just wants to put the A380 program out of its misery.
But British Airways is eyeing replacements for its Boeing 747-400s and talking to Airbus about doing so with A380s. Currently, BA operates 12 Airbus A380s. Walsh added:
I’ve no concerns about the A380… it’s been an excellent aircraft for us. We have made it clear to Airbus that we might consider some additional aircraft. But the pricing of that aircraft has not been as attractive as we believe it needs to be.
I’m sure other airlines would line up as well if Airbus was just going to give it away…
Airbus is in a very difficult position. It loses money on its A380 program and would like to retire it, but it doesn’t want to lose market share and orders of other aircraft by prematurely shutting down the A380 plants. There may be no margin left to squeeze out of Airbus, but if it wants to continue the A380 program it is going to need to lose even more money. Thus, BA’s idea of cutting price is one plan to save the program, just probably not a viable one.