News from Reuters today suggests that Airbus might utilize the soon to be empty A380 FAL for the A321 line.  This is truly a serendipitous outcome for Airbus.

The closure of the A380 line does not come with zero cost.  Airbus has big sunk costs it has to write off.  But even as it takes that hit, the timing on this is not as bad it could have been.  Indeed, the timing is about as good as it can get.

Demand for the A380 may have fallen off a cliff, but demand for the A321 is strong and rising.  Airbus needs more A321 production capacity. Customers are vocal about delivery delays.  Partly this annoyance is due to the schedule impact airlines have to overcome.  But this annoyance is exacerbated by the lack of anything from Boeing to ease the shortage of seats.

Unlike Boeing, Airbus will now have the ability to increase production of an aircraft the market wants.  Boeing cannot deliver any MAX9 or 10 for the time being.  If Airbus had another five A321 delivery slots per month they would be snapped up.  Converting the A380 FAL to A321 won’t happen overnight and Airbus probably won’t see any benefit for more than a year.  But aerospace production is a high stress business.  Customers will see that Airbus is likely able to deliver faster than Boeing.  As we have noted before, commercial aviation no longer is focusing on orders – the big race today is about deliveries.

The supply chain is stressed and the MAX grounding is allowing some relief.  But at the same time, suppliers need to be able to deliver the parts they have been making.  Airbus, with a new single aisle FAL will be a welcome outlet.

The loss of the A380 could not have been timed better for Airbus.

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Addison Schonland
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Co-Founder AirInsight. My previous life includes stints at Shell South Africa, CIC Research, and PA Consulting. Got bitten by the aviation bug and ended up an Avgeek. Then the data bug got me, making me a curious Avgeek seeking data-driven logic. Also, I appreciate conversations with smart people from whom I learn so much. Summary: I am very fortunate to work with and converse with great people.

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