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December 7, 2010

The A380 and the future of aircraft orders

Analyst Insight by Lisandra Minussi.

On 4 November 2010, an A380 aircraft operated by Qantas was forced to make an emergency landing during a flight from Singapore to Sydney following a mid-air engine explosion. This was the second time Qantas has had a problem with the Superjumbo. In April, it damaged its tires during a landing in Sydney, showering sparks and scaring passengers.

Luckily, none of the 433 passengers and 26 crew members were injured in the latest incident. Nevertheless, it raised concerns of where to draw the line between the safety passengers and the race for bigger and more efficient aircraft.

Immediate action

Following the explosion, Qantas grounded all of its six A380s in operation until further notice. Meanwhile, aviation authorities such as the Civil Aviation Safety Authority (CASA) as well as Australian regulators are investigating the causes of the explosion along with Rolls-Royce. All other airlines operating A380s – Air France, Emirates, Lufthansa and Singapore Airlines – decided not to ground its A380 aircraft.

A closer look into the A380

The A380 is the largest passenger aircraft in the world, with a seating capacity for up to 853 passengers. The double-deck, wide-body and four engine aircraft is manufactured by Airbus, with Rolls-Royce being a key contributor of engines.

As of October 2010, a total of 38 A380s are in operation. Asia Pacific is the region with most A380s, followed by the Middle East and Europe. Although North America has placed 10 orders for the aircraft, none have been delivered so far.


Future deliveries

It is still too early to determine the real impact the explosion will have on future aircraft orders. It is important to note, however, that the ongoing investigations coupled with the fact that Rolls-Royce asked Airbus to return some engines from the production line to replace the ones already in operation, is expected to delay upcoming deliveries.

As of November 2010, both Qantas and Singapore Airlines, which have a combined 22 A380s to be delivered in the next months, have not been informed of any delays.

Future orders for the so called Superjumbo are most likely to be put on hold given this is not the first incident involving an A380.

Indeed, fuel and computer glitches have been recurrent since the first A380 flight. In November 2009, for example, one Air France flight was forced to land in New York after experiencing problems with its navigation system.

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