Airbus is having serious trouble finding buyers for its A380 jumbo jet. The latest hit came Tuesday with the cancellation of an order for six of the world’s largest passenger planes from Japan’s Skymark Airlines. At list price, the cancellation will cost Airbus $1.7 billion.
Jumbo jets like the A380 and Boeing Co.’s (NYSE: BA) 747 might be on their way to meet the dinosaurs and woolly mammoths. The order book for the A380 shows a total of 324 orders, of which 135 have been delivered, leaving 189 still to be built.
Since the first 747 was shipped off to PanAm in 1970, Boeing has delivered 1,488 of the planes, and it has just 50 remaining on its order book. The latest passenger version of the plane, the 747-8, has unfilled orders for 29 planes, and the freighter version, the 747-8F, has unfilled orders for 21. Boeing lowered the production rate for its 747 from two a month last year to 1.5 a month beginning this year.
If neither Airbus nor Boeing upgrades its respective jumbo jets, the Boeing 777X family of planes could eat their lunch. A comparison by aircraft industry research firm Leeham shows that when the 777-9X begins being delivered to customers in 2020, it will use 13% less fuel than the A380-800 and more than 15% less than the 747-8. And the range on the 777-9X is equal to the A380-800.
Are the A380 and the 747-8 worth saving? We won’t know until either Airbus or Boeing announces a plan to put new engines on the planes and make other improvements that will attract customers who will be willing to pay what is certain to be a whopper of a price for the jumbo carriers.
Boeing’s stock traded down about 0.2% in the noon hour Tuesday, at $122.79 in a 52-week range of $101.77 to $144.57.