Airbus Limits A350 Customization, Avoid A380 Pitfall

Airbus SAS is putting stricter controls on how airlines can custom-design the cabins of A350 widebody planes after a multitude of requests for different interiors for the A380 led to cost overruns and delays.

The planemaker, based in Toulouse, France, sees a much larger market for planes of the A350’s size than the A380 and aims to avoid delays, said Tom Williams, executive vice president of aircraft programs.

The A350, which will challenge Boeing Co.’s 777 and 787 models, is set for entry into service in 2013, with 530 orders from 33 customers. The A380 began service in late 2007, 2 1/2 years late and 50 percent over budget, having notched up development costs of 18 billion euros ($25 billion). Airbus has struggled to satisfy each airline’s different requests, spanning showers, cocktail bars and private suites in some cases.

“Where we got into trouble, and where we continue to get into trouble in the last couple of years, has been with customization,” Williams said today in a briefing at Airbus’s wing-building facility in Broughton, U.K. “If you look at what we’re doing with the A350, we have had a much more rigorous approach to A350 customization.”

Williams said airlines will be able to pick and choose the placement of seats, galleys, bathrooms or in-flight entertainment within the confines of a “background” template.

Singapore Airlines Ltd. and Gulf carrier Emirates are among those that have embraced cabin customization in order to make their A380s flagships.

A350 Range

Airbus, a unit of European Aeronautic, Defence & Space Co., has 27 A380s flying commercially today and has won a total of 202 orders. The company has forecast that aircraft operators may buy about 1,300 very large passenger planes over 20 years. That would include Boeing 747-8s. By contrast, it’s predicting sales of 5,000 aircraft with 250 to 300 seats over 20 years, a category that includes the A350.

The European company plans to debut the new range with an A350-900. That will be followed by the A350-800, planned for 2014. An even larger variant, the A350-1000, is scheduled to enter service in late 2015, Airbus said today.

Another lesson learned from past aircraft programs, including the A380, is that difficulties arise when customers buy seats, in-flight entertainment and other equipment for Airbus to install before delivery. Five aircraft were affected by a ruling last year from the European Aviation Safety Agency that withdrew approval for seats made by Yokohama, Japan-based Koito Industries Ltd. With the A350, Airbus will buy seats and in-flight entertainment systems directly.

Secure Supply Chain

The shift will allow the planemaker to “secure the supply chain,” Francois Caudron, an Airbus vice president, said today in a webcast. Airlines will still choose the supplier and negotiate the price, however.

Production of the A380 superjumbos is now “on the right track,” with a goal of 20 deliveries this year, double the pace of last year, Williams said. Design changes underway on the plane will add 100 nautical miles to its range, he said.

In a later presentation, Chief Operating Officer John Leahy told journalists that he expects to seal contracts for the sale of 10 A380s this year, and said he wouldn’t bet against the possibility of doubling that number, as he expects an economic rebound to attract new buyers.

New Engine Decision

Airbus is also still talking to engine makers Pratt & Whitney and CFM International, a joint venture of Safran SA and General Electric Co., about possible plans to put new engines on existing A320 planes, both Williams and Leahy said today.

Leahy said Airbus expects to make a decision in coming months on whether to go ahead and fit new engines onto old planes, and promised more information at the Farnborough Air Show set for mid-July. A final decision won’t come till later in the year.

Aircraft lessors are resistant toward seeing Airbus or Boeing fit new engines onto older models as that move could soften residual values for existing A320 and 737 planes, Leahy said. Airlines, however, are generally in favor, he said, as the increased fuel-efficiency from new engines would serve as a hedge against rising fuel prices.

Leahy predicted that if Airbus chose to put new engines on the A320 series, which began flying in the late 1980s, Boeing would make a similar move with its 737 series, which was largely redesigned in the mid-1990s. Media reports containing speculation about Boeing introducing an all-new plane to succeed the 737 as early as 2018, to get a jump on Airbus, should be taken with “a little grain of salt,” he said.

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