Economic News

Airbus is putting an end to the superjumbo aircrafts

Prominent plane manufacturer Airbus has come out with the announcement that they are calling it a day for the A380 aircraft. This was an iconic superjumbo jet model which had come into the market with the promise of revolutionizing commercial air travel but failed miserably in doing so.

The European company announced on Thursday that it would end the production of the model in 2021. This has come in the back of its main customer, and Dubai-based airline Emirates canceled its usual share of orders by a huge margin for the world’s largest airliner.

“It’s a painful decision,” Airbus CEO Tom Enders commented during a conference call with analysts. “We’ve invested a lot of effort, a lot of resources and a lot of sweat into this aircraft.”

“But we need to be realistic,” he also remarked. “With the decision of Emirates to reduce orders, our order backlog is not sufficient to sustain production.”

This move is said to be the cause of a major setback for at least 3,500 jobs at the manufacturer’s facilities which are spread over 4 European countries in the three upcoming years.

The model introduced 14 years ago, and it cost around $25 billion. However, the speculations that there would be a need for airliners to carry 853 passengers between major international hubs did not pay dividends.

Since then, the company has produced around 234 jets. This is a major deficit when compared to 1200 that it predicted in the beginning. Many of the airlines switched to the lighter and more efficient airliners and hence its hopes were shattered.

“Passengers all over the world love to fly on this great aircraft. Hence today’s announcement is painful for the A380 communities and us worldwide,” Enders said in a statement. “But keep in mind that A380s will still roam the skies for many years to come and Airbus will, of course, continue to support the A380 operators fully.”

Airbus showed some improvement in shares as it rose by 5%. This came after it made its 2018 earnings public and announced the news about A380. Its net profit showed improvement as it rose to €3.1 billion.

The company also remarked that it would deliver 880 to 890 aircraft in 2019 which surpassed several predictions. Meanwhile, its main competitor Boeing announced in January that it would be releasing around 905 aircraft. The latter is still producing the famous jumbo jet also known as 747. However, its production was as low as six units in the year 2018.

“While we are disappointed to have to give up our order, and sad that the program could not be sustained, we accept that this is the reality of the situation,” Emirates Chairman Sheikh Ahmed bin Saeed Al Maktoum said in a statement. “The A380 will remain a pillar of our fleet well into the 2030s.” Emirates made an order for the lighter airliners from Airbus, instead of the larger one.

Marlene Warner

Marlene Warner has years of experience as a news writer, covering news on business, economy, personal financing, investment and much more. She has worked for some well-known digital publications and regional newspapers before becoming a news editor at FinancePlush.

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