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Outlook for current A380 remains cloudy

Airbus president and chief executive Fabrice Brégier has robustly defended the prospects for the A380, insisting that the aircraft will eventually be re-engined and that a stretched variant will be developed.

Speaking during a 10-11 December investors’ forum in London, Brégier sought to inject confidence into the programme in the wake of an Airbus financial outlook indicating that the A380, on a production basis, would still be breaking even around 2018.

Brégier’s upbeat prognosis followed a more sombre outlook from chief financial officer Harald Wilhelm, who hinted at an outside chance of halting the programme instead of upgrading the aircraft. The A380, said Wilhelm, will break even at production level next year and, given the efforts of reducing fixed and recurring costs, will stay at break-even in 2016-2017, with “flat” earnings in 2018 keeping the programme “close to the break-even with the current product”.

He added: “If we would do something on the product, or even if we would discontinue the product, that’s what it means.”

Wilhelm did not elaborate on the remarks, but his financial projections showed the A380’s contribution towards earnings are at odds with those from the A320neo, A330neo and A350 programmes. He said the A320 and A330 programmes would be “rather stable” in 2015, and he expects a volume and price pressure impact from the A330 in 2016, before ramp-up of the re-engined A320neo and A330neo programmes drive a recovery from 2017 onwards.

Speaking earlier, group chief executive Tom Enders said Airbus would need to make a decision, at some point, on upgrading the A380 – pointing out that the design was effectively 15 years old.

While more than 300 have been ordered, sales of the type have been uneven, with around half of the orders booked by Emirates, the carrier pushing hardest for modernisation of the aircraft.

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