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May 29, 2024
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Delta_A330Should Airbus produce an A330neo?  This question is on the minds of many, and is a topic that we have considered for some time.  As of this writing there have been more than 800 downloads of our 2012 paper on the potential for an A330neo.  Interest in this topic has been rekindled by the recent news that American Airlines converted its previous US Airways A350-800 order to the larger A350-900.

Boeing makes a compelling argument that its 787 and 777 brackets the A350, but ignores the A330 in its marketing presentations. But it seems airlines are not ignoring the A330.  Airbus keeps selling the airplane because it is, frankly, very good at what it does.  Indeed, it has become so good that it has enabled Airbus to utilize all the A340 production resources for additional A330s.  This increased A330 production, which allowed for more aggressive sales, came at a perfect time as the 787 program stumbled.

Should there be an A330neo?  We decided to go directly to Airbus with this question.  This morning, we had an extensive conversation with Crawford Hamilton, who is the Head of Twin Aisle Marketing at Airbus about the A330 and A350-800, to find out what Airbus is thinking.

First, he pointed out that Airbus has been tweaking the A330 from the start, and that the airplane is continuing to be updated.  The program began with a base model that was tweaked to include a growth model, after which came an enhanced (2004) version of each, and now there is second major updated version in the works.  This model  – let’s call that the “enhanced plus”, will have higher takeoff weights, and will be delivered to Delta Air Lines in 2015.

Airbus has continuously improved the A330,  much like Boeing has done to the 737 — never stop tweaking. As sales of the 737 demonstrate, it is a very effective industrial policy that can pay off in spades for the right aircraft.  The A330 has proven to be the best twin aisle aircraft in Airbus arsenal.  Using lessons learned from the A330 program itself, plus the A340-500/600, Airbus has created a new “enhanced-plus” model.  He pointed out Airbus spends $180m per year doing these tweaks on A330, and that in fact, Airbus spent as much on the A330 over the past ten years doing tweaks as they spent on the initial development of the aircraft.   He pointed out that even lessons learned from the A350 program are being fed back into the enhanced A330.

The net result is that the A330 has remained a highly competitive aircraft.  In preliminary calculations, we estimate the in service A330 compared to the 787 sees the latter with a 6.3% operating cost advantage, based on operational results reported by US carriers.  Given that Airbus is way down the development curve on the A330, it is able to price the A330 to readily compete with the 787, making up the operating cost disadvantage through lower capital costs. Moreover, the A330 is a well known program (meaning it is highly predictable) and that provides airlines with levels of operational  certainty that, at present, the 787 cannot.  Given that airlines are risk averse, many continue to buy the A330.

Consider how competitive the A330 is; Airbus can readily discount ownership costs to cover an 787 operational advantage.  Mr Hamilton pointed out that lower ownership costs are only part of the A330’s strength.  He noted that early 787 campaigns spoke of comfort but more recently 787 sales campaigns have stressed economics.  The early 787s was proposed as eight abreast in economy, but since has grown to nine abreast.  The A330 has a wider seat, currently configured at eight abreast. The A330 could go to a  tighter nine abreast regional configuration (for 2-4 hour segments) which would enable it, according to Mr Hamilton, to achieve parity on operational costs with the 787, and figuring in ownership costs, beat the 787 by “double digits” at equal seat count.  Perhaps this is why Tony Fernandes and AirAsiaX ordered more A330s.

Which brings us to the ongoing debate about A330neo and A350-800.  It appears interest in the A330neo is mostly external interest.  As Mr Hamilton pointed out Airbus tried the neo before as the A350 “Mark 1”, and “we got stung badly on that”.    Airbus does not seem compelled to do anymore than its ongoing tweaks because customers keep buying what they build.  Airbus has over 100 A330 operators and there many 767s they can replace.  Airbus, simply put,  feels the A330 still has sufficient momentum in the marketplace and should continue to be successful for the next few years.  Mr Hamilton stated that “the horrible problem is that the guys got the A330 right”, which reduces pressure for a neo solution.  He further pointed out that the 787 has not been able to open up a sufficient advantage over the A330, “so why should we do a new airplane”?

The A350-800 looks increasingly exposed to the A330’s continuing success.  When pressed about this, Mr Hamilton responded “it depends what we can do with the A350-800”.  There is considerable speculation in the industry that A350-800 will be scrapped in favor of a larger model, but he provided no guidance as to whether program cancellation was even a possibility during our discussion.

The A330 and perhaps A380 could be candidates for alternative engines, for example, a potential 70K GTF engine.  But Mr Hamilton pointed out that the new engines come at a price – better fuel burn costs a lot more weight, and larger fans cause more drag. The current A330 engines are relatively light and are “very proven and very reliable”.  A 70K GTF would be examined at by Airbus, but timing of demand and development need to come together. Or as Mr Hamilton stated,  “for us to do an A330neo would require an alignment of stars.”

Airbus feels that the market is currently satisfied by the continuing improvements to the A330.  Citing the additional 25 ordered by Air Asia last month, he indicated that market demand for the new 242t model remains strong, and that Airbus is able to price to the point of economic indifference against the 787.  As a result, while there is no current need for an A330neo, Airbus will continue to monitor opportunities to further improve aircraft as a part of its continuing improvement programs.

17 thoughts on “Clearing the air about the A330neo

  1. Did you have the chance to ask about the 15 A330 ordered by Kingfisher as well as the 5 A350-800?

    This is not at all a negative comment because we all know what will happen, but since you seem to have a quite close contact with the guy, perhaps you can get some hints on the issue.

    I guess the official response would be that the orders are firm as long as Kingfisher is not officially belly up.

  2. Nice interview. I guess it is impossible to communicate anything else than the current strategy. Anything else would create a storm e.g. virtually launching something and/or frustrating an ongoing sales campaign. A company is communicating a strategy until a different strategy is approved. Even including recent sales the backlog is shrinking.

  3. The A330 is the best twin aisle aircraft Airbus ever built. It is a very agile aircraft. The seating arrangement is an airline policy and some older A330s have narrow seats and their are no guarantees that these may be ordered on the tweaked aircraft version. The other point worth raising is that the A330 recent success was fueled by the B787 misfortunes in the sense airlines bought them as an interim aircraft until the B787s are delivered. The thing to watch for is what will airlines do with these aircraft once they receive the B787, the chances they will be returned to leasing companies or just parked, creating an alternative to new production aircraft. A few operators are using the A330s to replace the A340-200/-300s on some routes.
    The above may be considerations for Airbus not going for a NEO or canceling the A350-800 yet.

  4. Look at the larger A330 order trend. Aside from the Aisa X Blip (ie see the Emrirates A380 blip) its way down.

    Lots on the que, but few new orders. As the 787s come on line the 767s become bargains as well, not to mention retiring A330s and the hull value goes down.

    How good a bird it is you really need to talk to the mechanics, obviously successful but barring a sea change its going to fall off and as reapidly as the A340 in the end (5 years or so).

    Currently the 787 is marginally better, but as time goes by and the issues get worked out and the new lighter hulls come on line that will change as well.

  5. “Yes Addison, we are looking at a A330 re engining for EIS in 2018, but don’t tell anyone because we are negotiating A330 sales at this moment and talking to both GE and RR about various technical and financial scenarios.”

    That would be a highly unlikely answer IMO.

  6. Much of the A330’s success comes by way of Boeing’s dismal failure on the 787’s EIS. No other product available means Airbus had the market to itself. This is not meant to downgrade the A330, but when one factors in the 3 years of no 787’s coming off the assembly line and airlines needing more widebodies, the A330 was all that was left.
    With the 787’s coming on line and the A350 nearing EIS, the case for the A330NEO starts to fade as financing for a obsolete model makes little sense. It will never equal the efficiency of the three other next generation widebodies.

  7. “With the 787?s coming on line and the A350 nearing EIS, the case for the A330NEO starts to fade as financing for a obsolete model makes little sense. It will never equal the efficiency of the three other next generation widebodies.”

    The A330 is as much last generation as the 777. The 777X needs a stretch and an all new larger composite wing with zero commonality with the current 777s. What could Airbus do with the A330 in order to make it fully competitive with the 787?

    First, the A330, in fact, doesn’t need a larger wing. The current one is rightsized. However, the centre and outer wing box was designed to hold up to 139,000 litres of fuel for the A340-300. In comparison, the fuel capacity for the A350-1000 is 156,000 litres, while for the A350-900 it’s reduced to 138,000 litres. Hence, the fuel capacity of a fully competitive A330neo is too large. Even the centre wing box on the A330 is longer than the one on the A350: 10 (fuselage) frames at 0.535m vs. 8 frames at 0.635m.

    For an A330neo not only to match the 787, but to surpass it, IMO Airbus should modify the wing. How?

    The wing box should be reduced in size and volume. The centre wing box should be reduced in length by 2 frames (in the x-axis). Thus, the forward spar would have a greater taper than the current wing between the engines and the centre wing box (i.e. like the 787 and A350 wings). The centre spar should be removed (i.e. like the A350). Since the wing covers would be reduced in area, Airbus will have a clear option of making the entire wingbox in CFRP. That will reduce empty weight by some 7-8 tonnes. However, the wing would not be all new, since the movable surfaces etc would be retained from the current wing as well as landing gear, same engine distance from the aircraft centreline etc (i.e. on the 777X the engines are moved further outboard from the 777’s centreline).

    2nd, this new generation A330 should be equipped with engine technologies at least as advanced as the GE9X, or upwards of 10 percent betterment in efficiency over that of the Trent-1000 and the GEnx engines, which BTW are no longer state-of-the-art. Incidentally, such engines would be perfect for an A380neo.

    3rd, IMO the nose of the A350 (i.e. Section-11) should be integrated with the smaller circular A330 fuselage. Among other things, it would allow for a taller nose landing gear, 100 percent cockpit commonality with the A350 and better aerodynamics.

    With all these improvements plus an all new cabin and larger windows, an A330NG family could have the following members:

    A330-800: Same size as the A330-200, reduced MTOW (220 metric tonnes, optimised MLG); 8000nm range.
    A330-900: Same size as the A330-300, MTOW of 242 metric tonnes; 8000nm range.
    A330-1000: 10 frame stretch, MTOW of 242 metric tonnes; 7000nm range.

    Hence, by using the very latest engine technologies (i.e. TSFC up to 10 percent better than the engines on the 787), and a an affordable re-engineered wing, a next generation A330 family (i.e. not really an A330neo) would not only equal the 787 in performance, but surpass it by some margin.

  8. What will airlines do with their 777-300ERs once they get hold of new A350-1000s?

    Same silly question really as what airlines will do with their A330s once they start receiving B787s; even when considering that the fuel efficiency delta of the A350-1000 compared to the 77W will be greater than for the 787 compared to the current A330.

  9. All that for a stop gap filler?

    The A320 could get away with new engines (big market). The A330 has no such certainty and no one is going to come out with a new engine for it. Maybe (big maybe) a current derivative.

    New wing, no way.

    The 777 is unique in that a new wing and new engines and making it bigger got it away from the competition (at least for a while unitl the A350-1100). That said they should have gone Li-Al fuselage because its not that much better (interesing that either airlines are buying just the 1000 or the 1000 and 777X).

    RR might take a stab at the A330 with a derivative enigne and the factory could build down the wing, but its not going to be anything beyond that if it even makes it that far.

  10. I fully agree with this comment from kees on January 3, 2014 at 6:03 pm

    The blogosphere is now full of speculation on a possible A330neo launch. It may be not important because airline executives do not read blogs or discussion forums when deciding an order. So I guess they are well briefed by Airbus about the issue.

    Mr Crawford Hamilton did not validate nor deny the speculations about a possible A330neo. Is it a good thing or is it a bad thing? I do not know. In the meantime, I guess people will continue to speculate fiercely.

    The more the speculation drags on and on in the blogosphere the harder the communication will be.

  11. The 777 is no more “unique” than the A330. They are of the same generation. In contrast to the 777X, the A330 doesn’t need an all new wing, it merely needs a lighter one. By re-engineering the wing box (i.e. not the entire wing), the OEW could be reduced by a significant margin. As the movable surfaces on the leading and trailing edges accounts for up to 70 percent of the development costs for an all new wing, modifying only the wing box would lead to a much more affordable undertaking, overall.

    As for new engines for an upgraded A330, I would expect GE to only offer a souped-up GEnx while RR will in all likelihood offer an all new engine based one the new RB3039 engine concept. Rolls Royce offered the RB3025 for the 777X and lost out to GE. Why should RR not want to offer an all new engine for a new generation A330 that would be up to 10 percent more efficient than the Trent-1000, when such an engine would be ideal for an A380neo as well?

    Although both Rolls and the Engine Alliance have improved the fuel burn of the current A380 engines over time, Clark says a more radical improvement would boost the operating economics of the aircraft into the future, keeping it competitive with the new generation of large twins. He believes the engine makers could pick and choose from a raft of technology either developed or still in works for the 787, 747-8, 777X and A350 families over the past decade. The A380 “came to market in 2004-2005. A lot has changed,” he says. Referring to the General Electric GE9X in initial development for the 777X and the Rolls Trent XWB under test for the A350, Clark says options could include “a smaller version of the 9X. It could be a smaller version of the Trent.”

    Rolls says “it continues to study all options and is constantly working with Airbus” on prospective engine solutions. However program sources indicate a variety of options are under evaluation ranging from scaled ‘light’ derivatives of the Trent XWB, to an adapted variant of the Trent 1000TEN in early development for the Boeing 787-10. The manufacturer is also believed to be reviewing designs based on the RB.3025***, an all-new engine configuration which lost out to the GE9X in the contest to power the newly-launched 777X.

    http://www.aviationweek.com/Article.aspx?id=/article-xml/awx_11_19_2013_p0-638323.xml

    *** Now designated the RB3039 engine concept.

  12. Did your assessment of the 330neo change or do you just leave the Airbus communication without comment? Only possibility I see is that the engine manufacturer basically covers the costs of a neo. Otherwise, I wouldn’t find it so intelligent to sink lots of money in a plane that is in the end an old plane with its biggest strengths availability and reliability, which the current 330 has as well.

  13. IMHO, A will cancel the A358 in the sense that they will refuse to build it in it’s present form because the wing is not optimized for it, and the fuselage is too heavy. It is these deficiencies that have contributed significantly to it’s low sales. However, A WILL build a version of the A358 which corrects these defects instead of neoing the A330 because, as CM, a knowledgable Boeing person put it on Leeham Net, why spend billions on the A330 just to end up with the same aluminium plane when you have already spent billions on a perfectly good composite state of the art plane in the A358 which you can improve for about what it would cost to neo that A3330; and even if the price is significantly higher the value will still be far greater than a neod A330.

  14. Why shouldn’t Airbus build the A330NEO then someone else pays most of the costs (e.g. engine manufactures)? Maybe the A350 is too much aircraft (range) for many airlines and the smaller A330 with more fuel efficient engines is quite OK and less expensive? Why should Airbus have problems with an aluminium aircraft while Boeing does an aluminium fuselage on the 777-X? Boeing needs an enlarged new wing on 777-X but the aluminium wing of the A330 is quite fine.

    The next thing is availability. A350 and B787 are sold out for years. The production of the B787 is not at 10 aircraft per month and A350 entry into service is still ahead.

  15. why not put a scaled down wing on A350-800….325 sq meters instead of 443? and new optimized engine. it make it much lighter and efficient than 787. should make a better investment than A330neo. I don’t understand why A350 fuselage wall thickness is 14″…787’s is 11″…777x’s is 9″ thick that means 3 to 5 inches of extra cabin width from the same fuselage!!

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