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Etihad is an important Airbus and Boeing customer, but there's one plane it won't buy

Dec 11, 2015, 21:55 IST

AP
APEtihad CEO James Hogan.

Eithad Airways is one of Airbus and Boeing's most important customers.

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But the Abu Dhabi-based airline refuses to buy anymore of the respective companies' most expensive flagship models - the four-engined Boeing 747-8I jumbo and the Airbus A380-800 superjumbo.

Two years ago, Etihad placed one of the largest airplane orders is aviation history - 199 jets from Airbus and Boeing, along with engines from Rolls-Royce, GE and CFM to power them.

In total, the order is worth $67 billion.

The order form includes everything from small, short-range airliners to long-range widebody jets to freighters.

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But there are no four-engined jumbo jets.

In 2008, Etihad chose the Airbus A380 over Boeing's 747 and placed an order for 10 jets.

Thus far, Airbus has delivered five of the 10 planes, with the rest expected to enter service over the next few years.

Even as Etihad CEO James Hogan promotes the airline's new A380 service to New York, the chief executive is reiterating the company's plan to refrain from purchasing anymore four-engined jets in favor of smaller, twin-engined airliners.

"We are taking over 70 Boeing 787s, over 60 Airbus A350s, and we are the launch customer for the next generation Boeing 777," Hogan said. "We just believe in two-engine technology - they are much more efficient."

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Currently, Eithad's fellow Middle Eastern airline, Emirates, is lobbying Airbus for an upgraded variant of the A380, with more fuel efficient engines and optimized aerodynamics.

Will an upgraded A380 be enough for Etihad to change its mind?

"No, we're done," Hogan reiterated.

REUTERS/Fabian Bimmer
REUTERS/Fabian Bimmer

Unfortunately for Airbus and Boeing, there are few airlines left with an appetite for its flagship jumbos. In the last eight years, Boeing has sold just 45 747s - the majority of which are to be deployed as heavy freighters.

Earlier this year, Boeing announced it will be cutting back 747 production to just one per month in an attempt to extend the production run and buy the sales team some extra time to generate more orders.

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The Airbus A380 isn't doing much better. Since its introduction more than a decade ago, Airbus has sold just 317 A380s with half them to a single customer - Emirates. In fact, Airbus hasn't won an airline order for the double-decker jet since it sold Emirates a batch two years ago.

The demise in popularity of the jumbo jet can be attributed to a change in aviation regulations, airline business models and improvements in jet engine technology.

Traditional aviation thinking dictates that there is safety in numbers. As a result, planes flying long-distance routes were required to have more than two engines- on the off chance one of them fails, there are at least two more to keep the plane going.

Boeing
BoeingBoeing 747-8I.

These days, with turbofans engines getter much more powerful and reliable, engine failures are becoming increasingly rare. As a result, aviation regulating organizations have now certified fuel-efficient twin-engined jets such as the Boeing 777 and the Airbus A330 to fly the routes traditionally reserved for gas-guzzling jumbos.

In addition, airlines are moving away from the "hub and spoke" business model which calls for massive numbers of the passengers to be routed through a single mega-hub. Smaller, fuel efficient jets such as the Boeing 787 Dreamliner allow airlines to offer passengers non-stop, point-to-point service without transiting through a hub. But the airlines can still make a profit.

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