Transport Airlines

Emirates isn’t happy with Airbus, so it’s looking to the manufacturer to cover grounding losses

Dec 03, 2012 12:38 am

Skift Take

Emirates has doubled-down on Airbus, so its right to apply pressure on the manufacturer to right the mistakes that forced the carrier to keep planes on the ground.

— Jason Clampet

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Emirates will be seeking compensation from Airbus for grounding A380 aircraft due to wing repairs, the largest operator of superjumbos confirmed to Khaleej Times.

The Dubai carrier is justified in demanding the compensation, which is expected to be millions of dollars being the largest operator of 21st century flagship jetliners, according to a senior aviation analyst.

“Emirates can confirm that on-going discussions are being held with Airbus in regards to compensation for the A380 aircraft wing repairs,” an Emirates spokesperson said in an e-mailed statement.

Emirates earlier this year said the need to ground its double-deckers to fix wing cracks was causing significant commercial disruption and costing the airline around $30 million a month.

The airline operates the world’s largest fleet of A380 aircraft at 27, with four more to be delivered up to the end of 2012, and another 63 on order. In February, Airbus said airlines operating the A380 would need to ground the aircraft for up to eight weeks to undergo repairs.

“Emirates is right to air concerns that A380s out of service for almost two months at a time means that the carrier stands to lose out in millions of dollars in revenue. So it’s no surprise that they demand that Airbus reimburse more than just the cost to fix the wings of its A380 fleet,” Saj Ahmed, chief analyst at London-based StrategicAero Research, told .

Airbus parent European Aeronautic Defence and Space Company said that it expected costs related to repairing wing defects in its Airbus A380 model to rise to 260 million by the end of 2012. As at October 31, Airbus has delivered 89 A380s while total orders booked reached 257 aircraft.

“In the end, the cost to Airbus could be very heavy as well. With no permanent fix in sight until almost the end of 2014, this could well end up costing them billions — not just for the repair itself, but compensation to other airlines that will also see what Emirates is getting and want in on the action,” Ahmed said. The Dubai carrier will pull four of the aircraft from service at a time for a period of two months, Emirates president Tim Clark said last month.

Ahmed said Emirates has recently reported very strong first-half earnings and the news that the A380 work could run into years to complete will of course impact on their ability to leverage growth in the coming second half of their earnings year.

This week, Emirates’ A380 destination list has flown past 20, with Singapore and Moscow joining the airline’s double-decker network.

Emirates now operates to 21 A380 destinations with new cities to be announced in the coming months.

In the four years since the A380 has been in operation, over 11.5 million passengers have flown on the aircraft, covering 169 million kilometres.

(c)2012 the Khaleej Times (Dubai, United Arab Emirates. Distributed by MCT Information Services. 

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