GaryMrMets
01-17-2005, 11:34 PM
http://aolsvc.news.aol.com/business/article.adp?id=20050117071509990028
Largest, Most Expensive Passenger Plane Set to Soar
By Noelle Knox, USA TODAY
With the stakes sky-high, European aircraft maker Airbus this week shows the world what it hopes is the airplane of the future.
Tuesday, the company will unveil its gargantuan A380, a double-deck aircraft that can carry at least 555 passengers. The plane is longer, taller and wider - wingtip to wingtip - than the White House.
In a sprawling manufacturing plant at Airbus' headquarters in Toulouse, France, aerospace industry leaders and top government officials from Great Britain, France, Germany and Spain will gather for the ceremonial debut. Airbus has spent more than a decade developing the plane, which is expected to begin carrying passengers next year.
Riding on the success of the plane is European pride and an enormous amount of money. The A380 will replace Boeing's 747 as the largest passenger plane, and could crush Boeing's chances of regaining its place as the No. 1 commercial plane manufacturer, a title Boeing lost to Airbus in 2003.
The huge plane reflects the Airbus belief that airlines will turn to high-capacity aircraft to unclog the current congestion in air travel, and to handle an expected explosion in the number of travelers in the coming years. If the calculation is correct, Airbus is well-positioned to meet the demand and take long-term command of the $55 billion aircraft manufacturing industry from U.S. rival Boeing.
"It's the realization of a dream of many people to build an airplane to change air transport in the 21st century, the way the (Boeing) 747 changed air transport in the 20th century," says Airbus executive John Leahy. The A380 has been a source of friction not only between Airbus and Boeing, but also between Europe and the USA, because both companies rely heavily on government subsidies to help with development costs. To avert a massive trade war, diplomats on both sides said last week that they will try to reach a settlement within 90 days on the amounts and types of aid that should be allowed.
In the fight for dominance, Boeing today lags Airbus only slightly in plane sales. But their strategies for tomorrow are fundamentally different. While Airbus is gambling on its giant new plane, Boeing is betting on the 7E7 Dreamliner, a smaller 250-passenger plane, to be unveiled at the end of next year.
The cost of developing each new plane is too great for either company to back down now. Airbus, however, recently hedged its bet by committing to developing a new 250-seat plane to go head-to-head with Boeing's 7E7. Airbus plans to introduce its A350 at the end of the decade.
For now, Philip Finnegan, of aerospace consultant Teal Group, gives Airbus the clear advantage. Boeing is vulnerable to financial difficulties of the big U.S. airlines, he says. Also, recent investigations of its defense business might distract management, he said.
Massive Investment
Airbus has spent $13 billion developing the A380, about $2 billion over budget. The mammoth plane has a matching price tag: $280 million, though many airlines have negotiated discounts. Aviation regulators will begin the safety certification process with the first test flights during the first half of this year. The first planes will be delivered to Singapore Airlines in mid-2006 and are expected to be used for the carrier's route to San Francisco, and later to Los Angeles and New York. Other customers include Virgin Atlantic, Air France, Lufthansa and Emirates.
So far, no orders have come from U.S. passenger airlines, many of which are struggling, though U.S. transporters FedEx and UPS have signed up for cargo versions.
It seems unlikely U.S. passenger airlines will place orders very soon, Finnegan says. "There is the problem of the financial conditions of the airlines, but you also have a problem of perception - that it's not a passenger-friendly airplane."
That view arises, he says, from the fact that so many passengers will have to get on and off the airplane and get their luggage at the same time.
Nevertheless, Emirates airlines, the national airline of the United Arab Emirates, has signed the largest deal: 45 planes. The order is part of its plan to turn Dubai into a global tourism and transportation hub.
The carrier plans to put "in-air bedrooms" in first-class sections that can be closed off from the rest of the cabin. Each bedroom suite will have a minibar, closet and footrest that can be turned into a second chair for a business meeting.
The cabin also will have high-tech lighting to help passengers' body clocks adjust to new time zones and reduce jet lag.
Emirates spokesman Mike Simon calls the A380 "the perfect plane for us to build and develop into the future." Simon dismisses Boeing's 747-400 as "old technology."
Emirates now flies Boeing 777s, and has ordered more. As for the new 7E7 Dreamliner, Simon says, "We're looking at it, but the present version ... doesn't carry enough passengers."
More than 60 airports worldwide, including about a dozen in the USA, are spending millions to modify airfields and gate areas, and to reinforce runways and taxiways, to accommodate the A380. Los Angeles International, for one, expects to spend at least $53 million. Among changes: The roads for airport service vehicles that run parallel to the taxiways will have to be moved farther away because of the plane's wingspan.
Divergent Visions
Until the mid-1990s, Boeing and Airbus shared a common vision for aviation, and produced a comparable line of planes. Both companies still expect passenger traffic to double in 15 years; "The difference (now) is how we view the evolution of the market," Boeing executive Randy Baseler says.
Changing conditions are driving demand for smaller planes, he says. Passengers want flexibility. Smaller airliners can now fly longer distances. There's more competition among the airlines, and countries are imposing fewer flight restrictions on foreign carriers.
Baseler cites Boeing's own experience with customer demand as a case in point. In 1985, when Boeing introduced the first 200-seat plane that could cross the Atlantic, the 767, it immediately started stealing market share from the larger 747 - even though the smaller plane costs one-fifth more to operate per seat-mile. "Why did that happen? Because passengers want more frequencies and more non-stops," Baseler says.
Boeing saw the same trend on Asian routes when it launched the 300-seat 777-ER in the 1990s.
That's why Boeing is spending up to $10 billion to develop the midsize 7E7 Dreamliner.
The 7E7 will be able to fly non-stop between almost any two airports in the world. The body is made from carbon-fiber reinforced plastic - aviation technology never attempted on this scale. The superlight plane will use 20% less fuel than other planes of the same size. With the new reinforced plastic body, the planes will have much larger windows, improved pressurization to minimize ear-popping during takeoffs and landings, and more humidity to ease passengers' dry throats and eyes.
The 7E7, with a price tag of $120 million, will be unveiled at the end of next year, and Japan's All Nippon Airways will be the first to start flying the planes in 2008.
Baseler says Airbus' plans to build the midsize A350, "basically takes their 20-year product strategy and throws it out the window." Airbus' Leahy disputes that interpretation.
Keeping an Eye Out for Orders
Airbus has 149 orders for the A380, and needs another 101 to break even on its investment.
So far, Boeing has received 56 orders for the 7E7 - about one-quarter of its projections. Only one major U.S. airline, Continental, has placed an order.
Baseler says Boeing is mulling its future as a maker of jumbo jets.
At a meeting last fall in Hong Kong, he said the major airlines questioned whether Boeing will build a "stretched" version of the 747. The slightly longer plane could carry 450 passengers and - using the engines from the 7E7 - also fly a bit farther.
"They told us they need us to make a decision on it in the first half of 2005, so that's what we're in the midst of doing," Baseler says.
He has reason to wonder how airlines would respond if Boeing does commit to a stretched 747. Boeing hasn't sold a passenger version of the 747 since 2002 - another reason the company laughs off Airbus' big sales projections for the A380.
But only bigger airplanes can accommodate the explosive growth in air travel, says R.E.G. (Ronald) Davies, curator of the Smithsonian's National Air and Space Museum in Washington. Airports can't cope with the traffic created by maintaining the same size planes and increasing flight frequencies, he says.
Davies says Boeing, which ruled the market for jumbo jets for 35 years, got off track in 1995 when it scrapped plans for a 600-seat airliner. An anticipated order for the proposed airliner from British Airways didn't materialize, and Boeing pulled back.
"They canceled the plane instead of having faith," Davies says.
01-17-05 07:31 EST
© Copyright 2005 USA TODAY, a division of Gannett Co. Inc. All Rights Reserved.
http://cdn.news.aol.com/aolnews_photos/05/03/20050117082509990001
An employee works on the first Airbus A380 super jumbo passenger jet near Toulouse in southwestern France.
By the Numbers
http://cdn.news.aol.com/aolnews_photos/0e/02/20050117171509990010
555 Passenger Capacity
261 Feet Plane's Wingspan
$53 Million LAX Upgrade Cost to Handle Plane
$13 Billion A380 Development Cost
$2 Billion Amount Over Budget
$280 Million A380 Retail Pricetag
Source: USA Today
Largest, Most Expensive Passenger Plane Set to Soar
By Noelle Knox, USA TODAY
With the stakes sky-high, European aircraft maker Airbus this week shows the world what it hopes is the airplane of the future.
Tuesday, the company will unveil its gargantuan A380, a double-deck aircraft that can carry at least 555 passengers. The plane is longer, taller and wider - wingtip to wingtip - than the White House.
In a sprawling manufacturing plant at Airbus' headquarters in Toulouse, France, aerospace industry leaders and top government officials from Great Britain, France, Germany and Spain will gather for the ceremonial debut. Airbus has spent more than a decade developing the plane, which is expected to begin carrying passengers next year.
Riding on the success of the plane is European pride and an enormous amount of money. The A380 will replace Boeing's 747 as the largest passenger plane, and could crush Boeing's chances of regaining its place as the No. 1 commercial plane manufacturer, a title Boeing lost to Airbus in 2003.
The huge plane reflects the Airbus belief that airlines will turn to high-capacity aircraft to unclog the current congestion in air travel, and to handle an expected explosion in the number of travelers in the coming years. If the calculation is correct, Airbus is well-positioned to meet the demand and take long-term command of the $55 billion aircraft manufacturing industry from U.S. rival Boeing.
"It's the realization of a dream of many people to build an airplane to change air transport in the 21st century, the way the (Boeing) 747 changed air transport in the 20th century," says Airbus executive John Leahy. The A380 has been a source of friction not only between Airbus and Boeing, but also between Europe and the USA, because both companies rely heavily on government subsidies to help with development costs. To avert a massive trade war, diplomats on both sides said last week that they will try to reach a settlement within 90 days on the amounts and types of aid that should be allowed.
In the fight for dominance, Boeing today lags Airbus only slightly in plane sales. But their strategies for tomorrow are fundamentally different. While Airbus is gambling on its giant new plane, Boeing is betting on the 7E7 Dreamliner, a smaller 250-passenger plane, to be unveiled at the end of next year.
The cost of developing each new plane is too great for either company to back down now. Airbus, however, recently hedged its bet by committing to developing a new 250-seat plane to go head-to-head with Boeing's 7E7. Airbus plans to introduce its A350 at the end of the decade.
For now, Philip Finnegan, of aerospace consultant Teal Group, gives Airbus the clear advantage. Boeing is vulnerable to financial difficulties of the big U.S. airlines, he says. Also, recent investigations of its defense business might distract management, he said.
Massive Investment
Airbus has spent $13 billion developing the A380, about $2 billion over budget. The mammoth plane has a matching price tag: $280 million, though many airlines have negotiated discounts. Aviation regulators will begin the safety certification process with the first test flights during the first half of this year. The first planes will be delivered to Singapore Airlines in mid-2006 and are expected to be used for the carrier's route to San Francisco, and later to Los Angeles and New York. Other customers include Virgin Atlantic, Air France, Lufthansa and Emirates.
So far, no orders have come from U.S. passenger airlines, many of which are struggling, though U.S. transporters FedEx and UPS have signed up for cargo versions.
It seems unlikely U.S. passenger airlines will place orders very soon, Finnegan says. "There is the problem of the financial conditions of the airlines, but you also have a problem of perception - that it's not a passenger-friendly airplane."
That view arises, he says, from the fact that so many passengers will have to get on and off the airplane and get their luggage at the same time.
Nevertheless, Emirates airlines, the national airline of the United Arab Emirates, has signed the largest deal: 45 planes. The order is part of its plan to turn Dubai into a global tourism and transportation hub.
The carrier plans to put "in-air bedrooms" in first-class sections that can be closed off from the rest of the cabin. Each bedroom suite will have a minibar, closet and footrest that can be turned into a second chair for a business meeting.
The cabin also will have high-tech lighting to help passengers' body clocks adjust to new time zones and reduce jet lag.
Emirates spokesman Mike Simon calls the A380 "the perfect plane for us to build and develop into the future." Simon dismisses Boeing's 747-400 as "old technology."
Emirates now flies Boeing 777s, and has ordered more. As for the new 7E7 Dreamliner, Simon says, "We're looking at it, but the present version ... doesn't carry enough passengers."
More than 60 airports worldwide, including about a dozen in the USA, are spending millions to modify airfields and gate areas, and to reinforce runways and taxiways, to accommodate the A380. Los Angeles International, for one, expects to spend at least $53 million. Among changes: The roads for airport service vehicles that run parallel to the taxiways will have to be moved farther away because of the plane's wingspan.
Divergent Visions
Until the mid-1990s, Boeing and Airbus shared a common vision for aviation, and produced a comparable line of planes. Both companies still expect passenger traffic to double in 15 years; "The difference (now) is how we view the evolution of the market," Boeing executive Randy Baseler says.
Changing conditions are driving demand for smaller planes, he says. Passengers want flexibility. Smaller airliners can now fly longer distances. There's more competition among the airlines, and countries are imposing fewer flight restrictions on foreign carriers.
Baseler cites Boeing's own experience with customer demand as a case in point. In 1985, when Boeing introduced the first 200-seat plane that could cross the Atlantic, the 767, it immediately started stealing market share from the larger 747 - even though the smaller plane costs one-fifth more to operate per seat-mile. "Why did that happen? Because passengers want more frequencies and more non-stops," Baseler says.
Boeing saw the same trend on Asian routes when it launched the 300-seat 777-ER in the 1990s.
That's why Boeing is spending up to $10 billion to develop the midsize 7E7 Dreamliner.
The 7E7 will be able to fly non-stop between almost any two airports in the world. The body is made from carbon-fiber reinforced plastic - aviation technology never attempted on this scale. The superlight plane will use 20% less fuel than other planes of the same size. With the new reinforced plastic body, the planes will have much larger windows, improved pressurization to minimize ear-popping during takeoffs and landings, and more humidity to ease passengers' dry throats and eyes.
The 7E7, with a price tag of $120 million, will be unveiled at the end of next year, and Japan's All Nippon Airways will be the first to start flying the planes in 2008.
Baseler says Airbus' plans to build the midsize A350, "basically takes their 20-year product strategy and throws it out the window." Airbus' Leahy disputes that interpretation.
Keeping an Eye Out for Orders
Airbus has 149 orders for the A380, and needs another 101 to break even on its investment.
So far, Boeing has received 56 orders for the 7E7 - about one-quarter of its projections. Only one major U.S. airline, Continental, has placed an order.
Baseler says Boeing is mulling its future as a maker of jumbo jets.
At a meeting last fall in Hong Kong, he said the major airlines questioned whether Boeing will build a "stretched" version of the 747. The slightly longer plane could carry 450 passengers and - using the engines from the 7E7 - also fly a bit farther.
"They told us they need us to make a decision on it in the first half of 2005, so that's what we're in the midst of doing," Baseler says.
He has reason to wonder how airlines would respond if Boeing does commit to a stretched 747. Boeing hasn't sold a passenger version of the 747 since 2002 - another reason the company laughs off Airbus' big sales projections for the A380.
But only bigger airplanes can accommodate the explosive growth in air travel, says R.E.G. (Ronald) Davies, curator of the Smithsonian's National Air and Space Museum in Washington. Airports can't cope with the traffic created by maintaining the same size planes and increasing flight frequencies, he says.
Davies says Boeing, which ruled the market for jumbo jets for 35 years, got off track in 1995 when it scrapped plans for a 600-seat airliner. An anticipated order for the proposed airliner from British Airways didn't materialize, and Boeing pulled back.
"They canceled the plane instead of having faith," Davies says.
01-17-05 07:31 EST
© Copyright 2005 USA TODAY, a division of Gannett Co. Inc. All Rights Reserved.
http://cdn.news.aol.com/aolnews_photos/05/03/20050117082509990001
An employee works on the first Airbus A380 super jumbo passenger jet near Toulouse in southwestern France.
By the Numbers
http://cdn.news.aol.com/aolnews_photos/0e/02/20050117171509990010
555 Passenger Capacity
261 Feet Plane's Wingspan
$53 Million LAX Upgrade Cost to Handle Plane
$13 Billion A380 Development Cost
$2 Billion Amount Over Budget
$280 Million A380 Retail Pricetag
Source: USA Today