After this week’s A330neo, one might assume that Airbus is taking another leaf out of the Boeing playbook – sticking with one engine maker. What GE is to Boeing may be starting to look like what Rolls-Royce is to Airbus. With the foreseeable future in aviation looking like being filled with “MAX” and “neo” solutions, the obvious question is the A380neo.
Earlier this week Aviation Week put out a story that Airbus might be looking into this next year. Since the primary pressure on the A380neo comes from the largest customer, of course Airbus will give the matter attention. Even so, Emirates’ CEO has also said that absent an A380neo, they will keep taking delivery of the current version because it does the job better than anything else.
Which brings us to the the most obvious item for a “neo” – the engine. Emirates’ uses the GP7200, and yet its CEO has stated he does not think its maker, Engine Alliance, is in for the fight to develop a neo version. Turns out that this comment may be, shall we say, “guidance” – the type of guidance the larger Gulf carriers are well known for.
In our conversation with Engine Alliance’s CEO at FAS, there was no hesitation regarding the firm’s commitment of its its owners to the program. Even though this engine is focused on only one airplane, that also means its focus is finely focused. To think that the maker of the most popular engine on the A380 program will give up the fight is really premature. Take a look at these two charts.
These numbers don’t look like those from a program that is an underdog. The data is confirmed by the Airbus Orange Book. Moreover all three Gulf carriers that have A380s in service or on order have the GP7200 engine.
Then take a look at how Engine Alliance is developing a future for their engine. It appears that the GP7200 is in for the race if and when Airbus decides to offer an A380neo. As we understand it, both Rolls-Royce and Engine Alliance are waiting for the specs before they make any moves. The investment costs of an A380neo program will have to be really attractive for either engine maker to do something new.
The posturing for an A380neo is coming from Emirates and Qatar. Airbus’ John Leahy expects anything like this to see the light of day in 2020. We expect to see Engine Alliance in there for the fight.
Its still a numbers issue. With 324 sold over the program start (1995) and a lot of operators deferring and in reality dead orders (Virgin, Qantas, AF) that leaves ?
So call it in 2020 a new engine and you only get 100 orders for the next 15 years? 400 engines? Whats the ROI on that?
The A330NEO program is probably worth a fight for and GE had the engine for it (setup for Bleed Air and relaible track history) and elected not to.
Even with the majority of the numbers GE and PW may not get an ROI on the current.
According to the Airbus press conference about launch of A330NEO it was mentioned that the costs are between 1 billionen or 2 billionen Euro. List price for A380 is €300 million. That is about twice as much for one A330. For just 100 A380NEOs the price would just raise by €20 million for each A380.
The whole thing is about how much Emirates or others are willing to pay for a NEO version.