(Insights) Will British Airways get more A380s?
After a breath from Emirates deal, Airbus is again in talks with IAG to acquire more A380s. British Airways, which currently has 12 A380s in its fleet, had said in the past that it was looking for six to seven second-hand A380s. Now it’s considering to take a larger number of new ones. It is also possible for IAG to allocate new jumbos for Aer Lingus or Iberia.
There are three main reasons why British Airways could purchase additional Airbus A380s. Firstly the airline requires additional ‘heavy’ aircraft to complete their long haul replacement. BA is currently having 36 active 747-400. With the airline aiming to retire them all by 2024, there is still quite a gap in capacity with the aircraft that are currently on order that could potentially be used to replace the outgoing type. The 300 seater 787-10 they ordered will replace 777-200ER or 747s on medium haul flights, while some Airbus A350-1000 can be used to replace Boeing 747-400 for long-haul, medium demand flights. However BA will still need additional 400 seater planes to replace the remaining 747s that are used on high demand routes (Beijing, San Francisco, and New York routes) Unless the airline chooses Boeing 777-9, more A380s is their only choice.
Secondly, BA is based at Heathrow Airport where slots are restricted due to the two runway system. A380s can maximize the number of passengers per flight at its London Heathrow hub, which is running close to capacity limits. The carrier’s main focus is on North Atlantic routes that are among the world’s busiest long-haul services, and it ranks as the No. 1 operator of Boeing 747. While their competitors (e.g. Norwegian) is beating the carrier by increasing frequencies through using smaller planes (e.g. 787s), British Airways is constrained by airport slots. Hence the airline is using A380s to reduce the number of aircraft used on a route while saving airport slots. When BA started flying the A380 to Los Angeles, it reduced a three-times-daily 747 service to two A380.
However, some may argue boosting seat capacity may not be the best choice for British Airways. The carrier is holding the major share of Heathrow and thus can control the supply with more feasibility when compared to Easyjet or Virgin Atlantic. Theoretically, if the carrier chooses to decrease passenger capacity by replacing Boeing 747-400 with Boeing 787-8/9s, they can increase airfare and generate more profit per passenger. As such, it is really a choice for BA on what marketing strategies they would like to use. "The A380 wouldn't work on every part of our network, so from that point of view we'd be less ambitious [in fleet size] than Emirates would be."
Lastly, new A380s can drive better benefits than those from the second-hand market. Refurbishing used A380s would be expensive while maintenance is higher than new ones. In addition, BA can only use A380s with Roll Royce engines due to maintenance costs. This also limits the second-hand A380 market for the carrier, bringing one more incentive for IAG to purchase new ones instead.
We can also presume that British Airways will be receiving new A380plus if the deal is made. This enhanced version can generate 13% lower costs per seat, featuring up to 80 more seats, while split scimitar winglets can allow 4% fuel economy improvement. IAG has always been in favor to purchase additional A380s. They were looking into second-hand planes as the new ones are too expensive. "If the price was right we would look to add more,” IAG spokesman has previously confirmed, “Airbus offer great aircraft, but not necessarily at great prices,” he added.
If Airbus offers a competitive pricing for the new A380s, it is very possible for BA to opt for this decision.
To conclude, if this rumor is true, it is likely for IAG to purchase 4-5 new Airbus A380 (or A380plus) if Airbus can offer a competitive pricing that wins over second-hand A380s or Boeing 777-9. If such deal is made, British Airways will use them as a replacement for high capacity routes 747 is currently operating.
Photo credits to https://www.instagram.com/heathrow.airliners/