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A380: the countdown is on - Orient Aviation

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MAIN STORY<br />

By Charles Anders<strong>on</strong><br />

Richard Carcaillet gives a lot<br />

of presentati<strong>on</strong>s. It <str<strong>on</strong>g>is</str<strong>on</strong>g> part of<br />

h<str<strong>on</strong>g>is</str<strong>on</strong>g> job as director of product<br />

marketing for Airbus’s new<br />

giant jumbo. He has all <str<strong>on</strong>g>the</str<strong>on</strong>g><br />

facts and figures about its performance and<br />

producti<strong>on</strong> at h<str<strong>on</strong>g>is</str<strong>on</strong>g> fingertips.<br />

One secti<strong>on</strong> of h<str<strong>on</strong>g>is</str<strong>on</strong>g> smart slides deals<br />

with airport demand. Although Carcaillet<br />

does not highlight it as such, <str<strong>on</strong>g>the</str<strong>on</strong>g>y spell out<br />

why A <str<strong>on</strong>g>is</str<strong>on</strong>g> not <strong>on</strong>ly for <str<strong>on</strong>g>the</str<strong>on</strong>g> <str<strong>on</strong>g>A380</str<strong>on</strong>g>, but for Asia<br />

as well.<br />

On h<str<strong>on</strong>g>is</str<strong>on</strong>g> world map of likely early routes,<br />

<str<strong>on</strong>g>the</str<strong>on</strong>g>re are plenty of bold strokes going across<br />

<str<strong>on</strong>g>the</str<strong>on</strong>g> Atlantic. But far more lead from Europe<br />

and North America into <str<strong>on</strong>g>the</str<strong>on</strong>g> Asia-Pacific.<br />

And, of <str<strong>on</strong>g>the</str<strong>on</strong>g> 60 airports which Airbus says<br />

will see <str<strong>on</strong>g>the</str<strong>on</strong>g> <str<strong>on</strong>g>A380</str<strong>on</strong>g> land before 2010, 19 are<br />

in <str<strong>on</strong>g>the</str<strong>on</strong>g> regi<strong>on</strong> and a fur<str<strong>on</strong>g>the</str<strong>on</strong>g>r five <strong>on</strong> <str<strong>on</strong>g>the</str<strong>on</strong>g> Indian<br />

subc<strong>on</strong>tinent.<br />

Of <str<strong>on</strong>g>the</str<strong>on</strong>g> 37 airports that currently handle<br />

87% of all Boeing 747 movements, 17 are in<br />

<str<strong>on</strong>g>the</str<strong>on</strong>g> Asia-Pacific.<br />

The reas<strong>on</strong>s are obvious: <str<strong>on</strong>g>the</str<strong>on</strong>g> regi<strong>on</strong> sits<br />

at ei<str<strong>on</strong>g>the</str<strong>on</strong>g>r <str<strong>on</strong>g>the</str<strong>on</strong>g> beginning or at <str<strong>on</strong>g>the</str<strong>on</strong>g> end of a<br />

majority of <str<strong>on</strong>g>the</str<strong>on</strong>g> world’s l<strong>on</strong>gest airplane<br />

routes.<br />

Its fast expanding cities act as magnets<br />

for business and le<str<strong>on</strong>g>is</str<strong>on</strong>g>ure travellers. They<br />

also c<strong>on</strong>tain growing populati<strong>on</strong>s that are<br />

increasingly <strong>on</strong> <str<strong>on</strong>g>the</str<strong>on</strong>g> move as <str<strong>on</strong>g>the</str<strong>on</strong>g>ir wealth<br />

increases.<br />

Add to th<str<strong>on</strong>g>is</str<strong>on</strong>g> c<strong>on</strong>straints <strong>on</strong> slots at<br />

specific times when planes crossing time<br />

z<strong>on</strong>es are likely to take off and land –<br />

ei<str<strong>on</strong>g>the</str<strong>on</strong>g>r in <str<strong>on</strong>g>the</str<strong>on</strong>g> Asia-Pacific or at European<br />

and North American destinati<strong>on</strong>s – and<br />

you have <str<strong>on</strong>g>the</str<strong>on</strong>g> equati<strong>on</strong> that Airbus argues<br />

makes <str<strong>on</strong>g>the</str<strong>on</strong>g> <str<strong>on</strong>g>A380</str<strong>on</strong>g> a winner.<br />

“Fragmentati<strong>on</strong> and c<strong>on</strong>solidati<strong>on</strong> are<br />

not c<strong>on</strong>flicting trends,” said Carcaillet,<br />

entering into <str<strong>on</strong>g>the</str<strong>on</strong>g> well-worn argument<br />

about where airline traffic <str<strong>on</strong>g>is</str<strong>on</strong>g> headed. “They<br />

are co-ex<str<strong>on</strong>g>is</str<strong>on</strong>g>ting – hub and spoke and also<br />

routes between two big points.<br />

“On <str<strong>on</strong>g>the</str<strong>on</strong>g> big point-to-point routes, like<br />

Tokyo to L<strong>on</strong>d<strong>on</strong> or Singapore to Frankfurt,<br />

you need more productivity at <str<strong>on</strong>g>the</str<strong>on</strong>g> airport<br />

because your infrastructure <str<strong>on</strong>g>is</str<strong>on</strong>g> not going to<br />

extend indefinitely to accommodate more<br />

and more frequencies. These major routes<br />

require larger aircraft.”<br />

He picked Singapore to Los Angeles<br />

or <str<strong>on</strong>g>the</str<strong>on</strong>g> record-breaking Singapore to New<br />

York as examples of young markets which<br />

can also benefit from a bigger aircraft that<br />

flies fur<str<strong>on</strong>g>the</str<strong>on</strong>g>r.<br />

sia’s<br />

<str<strong>on</strong>g>A380</str<strong>on</strong>g><br />

“They [Singapore Airlines] are flying<br />

<str<strong>on</strong>g>the</str<strong>on</strong>g>se with an Airbus 340-500. Th<str<strong>on</strong>g>is</str<strong>on</strong>g> <str<strong>on</strong>g>is</str<strong>on</strong>g> very<br />

much an example of fragmentati<strong>on</strong>. The<br />

<str<strong>on</strong>g>A380</str<strong>on</strong>g> logic <str<strong>on</strong>g>is</str<strong>on</strong>g> <str<strong>on</strong>g>the</str<strong>on</strong>g>re and very clear.”<br />

Carcaillet <str<strong>on</strong>g>is</str<strong>on</strong>g> keen to highlight <str<strong>on</strong>g>the</str<strong>on</strong>g> extra<br />

900 nautical miles that <str<strong>on</strong>g>the</str<strong>on</strong>g> <str<strong>on</strong>g>A380</str<strong>on</strong>g> can fly<br />

over <str<strong>on</strong>g>the</str<strong>on</strong>g> B747, with what Airbus claims are<br />

better ec<strong>on</strong>omics.<br />

“With more range, we can eliminate<br />

some of <str<strong>on</strong>g>the</str<strong>on</strong>g> c<strong>on</strong>straints that people have<br />

h<str<strong>on</strong>g>is</str<strong>on</strong>g>torically had with <str<strong>on</strong>g>the</str<strong>on</strong>g> B747-400; for<br />

‘ Singapore – Los Angeles and<br />

Singapore – New York are<br />

examples of young markets<br />

which can benefit from a bigger<br />

aircraft that flies fur<str<strong>on</strong>g>the</str<strong>on</strong>g>r’<br />

Richard Carcaillet<br />

<str<strong>on</strong>g>A380</str<strong>on</strong>g> director of product marketing<br />

example, Singapore to L<strong>on</strong>d<strong>on</strong>, Los Angeles<br />

to Sydney. Th<str<strong>on</strong>g>is</str<strong>on</strong>g> plane has outgrown <str<strong>on</strong>g>the</str<strong>on</strong>g>se<br />

c<strong>on</strong>straints.”<br />

Philippe Jarry, who was tasked with<br />

assessing <str<strong>on</strong>g>the</str<strong>on</strong>g> market for <str<strong>on</strong>g>the</str<strong>on</strong>g> <str<strong>on</strong>g>A380</str<strong>on</strong>g> in its<br />

A3XX days, points to airlines operating<br />

in markets that have developed bey<strong>on</strong>d<br />

current aircraft capacities and those which<br />

have used up all <str<strong>on</strong>g>the</str<strong>on</strong>g>ir frequencies and are<br />

hampered by time z<strong>on</strong>es.<br />

8 ORIENT AVIATION / <str<strong>on</strong>g>A380</str<strong>on</strong>g> Quarterly Update DECEMBER 2004-FEBRUARY 2005<br />

He gives Qantas’s three daily B747<br />

flights to L<strong>on</strong>d<strong>on</strong> as an example. “We<br />

looked at <str<strong>on</strong>g>the</str<strong>on</strong>g> bookings. It <str<strong>on</strong>g>is</str<strong>on</strong>g> very clear<br />

that <strong>on</strong>e flight number was <str<strong>on</strong>g>the</str<strong>on</strong>g> first that<br />

passengers take. Th<str<strong>on</strong>g>is</str<strong>on</strong>g> <str<strong>on</strong>g>is</str<strong>on</strong>g> <str<strong>on</strong>g>the</str<strong>on</strong>g> best time for<br />

departure and arrival,” he said.<br />

“Then, when it <str<strong>on</strong>g>is</str<strong>on</strong>g> full, <str<strong>on</strong>g>the</str<strong>on</strong>g>y switch to <str<strong>on</strong>g>the</str<strong>on</strong>g><br />

sec<strong>on</strong>d. Then <str<strong>on</strong>g>the</str<strong>on</strong>g>y shift to <str<strong>on</strong>g>the</str<strong>on</strong>g> third. We are<br />

not improving <str<strong>on</strong>g>the</str<strong>on</strong>g> service to <str<strong>on</strong>g>the</str<strong>on</strong>g> passenger<br />

by putting <strong>on</strong> a third, a fourth and a fifth.<br />

We would be better off having two bigger<br />

airplanes at <str<strong>on</strong>g>the</str<strong>on</strong>g> best time of <str<strong>on</strong>g>the</str<strong>on</strong>g> day.<br />

“The more we believe <str<strong>on</strong>g>the</str<strong>on</strong>g>re will be<br />

curfews, <str<strong>on</strong>g>the</str<strong>on</strong>g> more <str<strong>on</strong>g>the</str<strong>on</strong>g>y will restrict <str<strong>on</strong>g>the</str<strong>on</strong>g> time<br />

for arrival and departure. You cannot send<br />

squadr<strong>on</strong>s of mid-sized airplanes. It would<br />

be ridiculous and it’s not ec<strong>on</strong>omical. Th<str<strong>on</strong>g>is</str<strong>on</strong>g><br />

<str<strong>on</strong>g>is</str<strong>on</strong>g> not <str<strong>on</strong>g>the</str<strong>on</strong>g> face of commercial aviati<strong>on</strong>. It<br />

does not resp<strong>on</strong>d to <str<strong>on</strong>g>the</str<strong>on</strong>g> requirements of th<str<strong>on</strong>g>is</str<strong>on</strong>g><br />

big and expanding market.<br />

“You are not really increasing customer<br />

sat<str<strong>on</strong>g>is</str<strong>on</strong>g>facti<strong>on</strong> by putting so many airplanes<br />

in <str<strong>on</strong>g>the</str<strong>on</strong>g> sky or at <str<strong>on</strong>g>the</str<strong>on</strong>g> airport, creating<br />

c<strong>on</strong>gesti<strong>on</strong>, delaying <str<strong>on</strong>g>the</str<strong>on</strong>g>ir flights.<br />

“There <str<strong>on</strong>g>is</str<strong>on</strong>g> <strong>on</strong>e thing that <str<strong>on</strong>g>is</str<strong>on</strong>g> not going<br />

to change, and that’s time z<strong>on</strong>es. Even if<br />

passengers were prepared to fly at 2am or<br />

arrive at 3am, it <str<strong>on</strong>g>is</str<strong>on</strong>g> not author<str<strong>on</strong>g>is</str<strong>on</strong>g>able. You<br />

arrive at 2am and <str<strong>on</strong>g>the</str<strong>on</strong>g>re <str<strong>on</strong>g>is</str<strong>on</strong>g> nothing. No tax<str<strong>on</strong>g>is</str<strong>on</strong>g>,<br />

no service, no food,” he said.<br />

Then <str<strong>on</strong>g>the</str<strong>on</strong>g>re are <str<strong>on</strong>g>the</str<strong>on</strong>g> ec<strong>on</strong>omics. With<br />

three-quarters of <str<strong>on</strong>g>the</str<strong>on</strong>g> cities above 15<br />

milli<strong>on</strong> projected to be in Asia in 20 years’<br />

time, Jarry argued <str<strong>on</strong>g>the</str<strong>on</strong>g> case for <str<strong>on</strong>g>the</str<strong>on</strong>g> <str<strong>on</strong>g>A380</str<strong>on</strong>g>’s<br />

importance to <str<strong>on</strong>g>the</str<strong>on</strong>g> regi<strong>on</strong> <str<strong>on</strong>g>is</str<strong>on</strong>g> simple.<br />

“People say it must be very complex.<br />

No it <str<strong>on</strong>g>is</str<strong>on</strong>g> not. When you aggregate more<br />

people toge<str<strong>on</strong>g>the</str<strong>on</strong>g>r, you d<strong>on</strong>’t have to be a<br />

rocket scient<str<strong>on</strong>g>is</str<strong>on</strong>g>t to understand that fuel<br />

c<strong>on</strong>sumpti<strong>on</strong> per nautical mile will be<br />

lower. ”<br />

Jarry adds crew costs to h<str<strong>on</strong>g>is</str<strong>on</strong>g> case. “If<br />

instead of three B747s, you can have two<br />

crews flying two <str<strong>on</strong>g>A380</str<strong>on</strong>g>s, you d<strong>on</strong>’t need to<br />

be an expert from Harvard to say <str<strong>on</strong>g>the</str<strong>on</strong>g>se are<br />

less costly. And now that you have reserve<br />

crews, it’s massive.”

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