Singapore Airlines (SIA) confirmed plans to take delivery of its tenth A380 this month, and its 11th in early 2010 (Bloomberg, 08-Sep-09). Last week, SIA deferred the delivery of its last eight A380s on order by up to one year. SIA stated it has flown over 1.6 million passengers on its A380 fleet since their introduction in Oct-2007, with an average load factor of 80%.
Singapore Airlines to add tenth A380 this month
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Where the A380 flies: Japan and intra-Asia routes decline while Australia & Middle East grow
The A380 is once again under media scrutiny, despite there being no major movement on the type. Comments from Air France and Qantas about not taking further A380s have long been assumed, and it has been apparent that Malaysia Airlines does not even have the need for its A380s. Singapore Airlines not renewing the lease on its first A380 is hardly surprising, and offers no definitive conclusion about the A380 or second-hand market; early A380s had different production and are not as efficient as later models. The lack of movement on the A380neo continues to irk the model's largest customer by far, Emirates, and may not make for a productive relationship as Emirates weighs an A350 or 787 order.
For most, the A380 continues to fly. How and where it flies is changing. Flights to and from the Middle East are becoming more common as Gulf airlines, and mostly Emirates, take delivery of A380s. A further shift to the Middle East is inevitable. In Japan there has been a near exodus of A380s; airlines dropping the type as they moved from Narita to Haneda, which cannot accommodate the A380 during the day, and Singapore Airlines down-gauging. Intra-Asia flying is decreasing – notable given the growth of A380s based in the region. Services by the A380 to Australia are growing, perhaps as it becomes an easy market for airlines to redeploy capacity amid European security concerns and trans-Pacific overcapacity.
Project Hope: Malaysia Airlines outlook hinges on spinning off new high-density A380 charter airline
Malaysia Airlines is planning to set up a new airline to operate its A380 fleet on religious pilgrimage charters to Saudi Arabia. All six of the airline’s A380s will be reconfigured from 386 to up to 700 seats by the end of 2018, and transferred to a new operator's certificate.
Malaysia Airlines is hoping to attract a combination of foreign and local investors to take control of the planned new airline and all six A380s. The group is calling the plan “Project Hope” – an appropriate name given its current predicament with the A380 fleet.
The flag carrier’s A380 operation has been highly unprofitable and the aircraft is too big for operation to London – its only remaining long-haul route. Malaysia Airlines is now committed to acquiring six A350s, which will be used to replace the A380 on London. As selling or subleasing the A380s is not possible given the virtually non-existent demand for the type, establishing a new charter airline is the only sensible option – although still with some risk, given the need to find investors.