September 27, 2022
Op-Ed: The A380 Is back – But for How Long?
Airbus Airlines Op-Ed

Op-Ed: The A380 Is back – But for How Long?

DALLAS – As demand for air travel rises, airlines announcing plans to reactivate their decommissioned Airbus A380 fleet has surprised observers. Lufthansa (LH) is the latest airline to reverse course after CEO Carsten Spohr announced a few months ago that its A380 fleet was to remain grounded.

Qatar Airways (QR) also reintroduced the type after declaring that its fleet is being phased out, and rumors are circulating that Etihad (EY) may follow suit in reintroducing the popular double-decker. The ultimate question is whether the A380 has found a new lease of life in a post-pandemic world, or are these redeployments merely a stop-gap?

Given that the recovery from the pandemic is already well underway, introducing the type at this late stage for LH gives the impression that the decision is very much an afterthought. While a number of airlines have pledged their loyalty to the type for the foreseeable future, others have deemed it less desirable.

As the legal battle between QR and Airbus over the grounding of its A350 fleet continues, the A380 has been billed as a stopgap measure to address the capacity deficit at the Qatari carrier.

It is worth noting that LH, QR, and EY have all signed orders for the Boeing 777X, a type that is still plagued by uncertainty regarding its entry into service. This ongoing unpredictability may also explain why the double-decker is making a come back, for the time being at least.

While EY has not committed to reintroducing the A380, 777X delays may influence a temporary return of the type for the UAE national carrier.

Photo: Tony Bordealis/Airways

The A380 Fuel Costs

Airlines around the world are seeing jet fuel costs bite further into their revenue, and data from IATA shows that the current average price of jet fuel is around 1350 US$ per metric ton. This represents a 117% increase over the previous year’s price and is still 75% higher than the previous peak in fuel prices in the second half of 2018.

Normally, the price of jet fuel closely follows the price of crude oil, but when the Ukraine conflict began, the price of jet fuel quickly outpaced the price rise of crude. There is a 50% mismatch at the time of writing, whereas the percentage difference is usually only a few points. While inflated fuel costs are an obvious thorn in the side for airline executives, having high and potentially volatile fuel costs is even worse.

When fuel costs more, it has to be passed onto the passenger, and the longer an aircraft stays in the air, the higher the value that needs to be added to the ticket price. This is particularly relevant here given that the A380 is marvelous at carrying plenty of passengers, but it simply doesn’t have the capacity to carry plenty of cargo as well, which can harvest a lucrative return to help offset higher operating costs.

The A380’s volumetric hold space is less than that of the largest twins flying today, such as the Boeing 777-300, Boeing 787-10, and Airbus 350-1000. For comparison, the cargo hold volume on a 777-300 is approximately 40% greater than that of an A380.

Because of the increase in passenger baggage associated with a higher passenger count, the A380 can offer significantly less cargo hold space. While cargo rates have stabilized in some markets following the spikes seen at the start of the pandemic, cargo still remains more profitable than it was prior to the pandemic. In some markets, per kilo rates are still at least double what they were at the beginning of 2020.

When we do some rough calculations, it quickly becomes clear that the A380 is becoming difficult to operate for very long journeys with the current fuel price.

If we consider a laden A380 and the previously mentioned average fuel price, a good rule of thumb at present is that the average cost of fuel per hour is around 17,000 US$. Granted, this value decreases during flight as the aircraft becomes lighter, but it should be a reasonable average.

Photo: Lorenzo Giacobbo/Airways

Offsetting the Fuel Cost with Ticket Prices?

Let’s consider a capacity of 500 passengers. The fuel cost per passenger per hour is 34 US$. That may not seem like much, but a 12-hour flight jumps to 408 US$, and keep in mind that this is only for a one-way trip, so the cost must be doubled for a return trip! The A380 is already being used for some marathon-length flights, and the key to success in these difficult times is to ensure that ticket revenues can address the exorbitant cost of fuel.

Filling seats in premium cabins on long flights will be critical because it will reduce the unpalatable cost per passenger that those traveling in economy must bear. Incorporating an 800 US$ fuel cost into a economy ticket for a 12-hour round trip journey will simply be intolerable to most and this is truer than ever, given the rising cost of living around the world. If the A380’s return is to be a success, then premium seats must be filled on more lengthy journeys.

While the A380 is a firm favorite among passengers, many crews, and, of course, enthusiasts who love to see it, further volatility in fuel prices could curtail its reappearance.

While some airlines have rekindled their affair with the type, it should be noted that the same airlines will be just as quick to limit its reappearance if operating economics deteriorate further than they are now.

For the time being at least, it would appear that the affair with the A380 for some airlines is one of necessity, rather than love.

Featured image: Lufthansa A380-841 D-AIMC. Photo: Brad Tisdel/Airways

Aviation author and commercial pilot based in the UK, with close to twenty years in the industry.

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