How Boeing cut short Airbus's rule as king of the skies.
11:00 PM, Dec 14, 2005 • By JAMES THAYER
EUROPE WAS CROWING, and it could be heard all the way across the ocean.
Airbus called Boeing's new 787 Dreamliner "dreaming in Seattle," and Airbus's then-CEO Noel Forgard dismissed the 787 as a "Chinese copy of [Airbus's] A330." The BBC said Airbus had stolen the march on its arc-rival Boeing, and the Economist predicted Airbus's A380 super-jumbo would "break the 747's longstanding monopoly on the big-jet market." Airbus's sales chief John J. Leahy said Boeing was ''just flailing around looking for something to compete with us.''
Indeed, 12 months ago Airbus seemed about to permanently replace the Boeing Company as the world's dominant airplane producer. It never happened. Instead, Airbus's ambitions have suddenly skidded off the runway.
Earlier this week Australia's flagship carrier Qantas ordered 45 787 Dreamliners worth $8 billion at list prices, and announced it would eventually take delivery of 100 Boeing airplanes, bringing the total order to $13 billion. Earlier in the month Hong Kong's Cathay Pacific Airlines also placed a big order: a dozen 777-300ERs with options for an additional 20 more planes, for a total list-price of $9 billion. The Qantas and Cathay Pacific contracts are bitter blows to Airbus and signaled Boeing's return as the industry king. The inevitability of European aircraft supremacy--so obvious a year ago--suddenly seems a laugher. What happened?
Boeing and Airbus have two competing and vastly different visions of the future of air travel. At least for now, it appears Boeing got it right.
TWO COMPANIES--Airbus and Boeing--manufacture the vast majority of the wide-body passenger airplanes in service around the world. Eighty percent of Airbus is owned by the European Aeronautic Defence and Space Company, formed by a 2000 merger of the German, French, and Spanish aircraft industries. Twenty percent is owned by the British company, BAE Systems PLC. Most Airbus fabrication occurs in Toulouse, Hamburg, Barcelona, and Broughton, in Wales.
Boeing's corporate headquarters are in Chicago, but its main commercial airplane plants are in the Seattle area. Both Airbus and Boeing believe that air-passenger traffic will triple in the next two decades. Half a world apart, the two manufacturers have been desperately dueling to gain a majority of orders for the 40,000 new planes they anticipate the industry will need in that time.
Airbus believes that the hub-and-spoke system will govern air travel in the coming decades, where larger airplanes fly between major cities--the hubs--and then the passengers are shunted to their final destinations on smaller planes. In their vision, travelers going from New York City to Little Rock would first fly the Chicago or Atlanta hubs on a jumbo jet, then on to Arkansas in a smaller plane.
To meet this perceived need, Airbus has developed the A380, which will enter service in a year. With a wingspan of 266 feet, the plane is routinely described in the European press as being as wide as a football pitch. The A380 is 240 feet long, and the top of its tail is 80 feet off the concrete.
How can airports handle such a behemoth, one that when fully loaded weighs 177 tons more than a loaded Boeing 747-400, and has a 50-foot wider wingspan, and will carry as many as 853 passengers, almost twice as many as the Boeing plane?
They can't. No airport older than brand new is wide enough, high enough, or thick enough to handle the A380.
So port authorities are scrambling to get ready. London's Heathrow will spend $821 million to accommodate the plane, and will widen taxiways, build double-decker loading ramps, construct new corridors that will segregate the hordes of arriving and departing passengers, and install longer luggage carousels in an enlarged baggage claim area. Heathrow's director of planning and development, Eryl Smith, says the A380 "will change the face" of the airport.
Los Angeles International will erect a new terminal for the A380. Singapore's Changi airport has widened runway shoulders and taxiway junctions, and lounges and passenger concourses have been increased in size. Some cities--Hong Kong, Seoul, and Bangkok--have built new airports that will handle the A380.
Airbus spent $12 billion developing the A380 super-jumbo, and those triumphant predictions made last year about Airbus's new dominance should have come true. And they would have, too, except for one small irritant: the Boeing Company.