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Airbus defends slowing A380 production to trickle

Airbus believes it can justify maintaining A380 production despite imposing another cut in output.

The airframer, which had already committed to slashing annual production to 12 A380s, has further reduced the level to just eight of the type from 2019, a rate of around one every six weeks.

Airbus chief executive Tom Enders, speaking during a first-half briefing, acknowledged that the A380 situation was "not so great".

But the airframer is expecting a relatively small impact from the decision, as a result of its continuing effort to bring down fixed costs associated with the programme.

While chief financial officer Harald Wilhelm, also at the breifing, would not quantify margin dilution on the A380 for 2018-19, he said the airframer would "harvest the benefit" of the cost focus.

Wilhelm acknowledges that eight aircraft per year is a "fairly low number", but says the impact in 2017 would be "marginal", and similarly for 2018, and by 2019 there should be "no material impact" on the A380, even at the reduced delivery rate.

He also points out that Airbus would not be prepared to continue producing the aircraft at such a low rate if such action significantly affected the margin situation.

Wilhelm had once sowed doubt over the future of the A380 programme when, at the end of 2014, he made remarks which appeared to hint at an option to discontinue the programme a possibility which Airbus vehemently dismissed shortly afterwards.

The airframer recently unveiled an upgrade package for the double-deck type, during the Paris air show, which includes the addition of fuel-saving winglets.

Airbus had 104 aircraft in its A380 production backlog at the half-year mark.

Emirates, which has deferred delivery of a number of A380s, accounts for 47 of these aircraft, while lessor Amedeo is the second-largest outstanding customer with 20.

Twenty-four aircraft on the backlog are assigned to carriers including Qantas, Virgin Atlantic, Singapore Airlines, All Nippon Airways and Qatar Airways, while the remaining 13 are listed against an unidentified customer and an entity called Air Accord.

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