Airbus Is Said to Be in British Airways Talks for More A380s

(Bloomberg) -- Airbus SE is in talks to sell new A380 superjumbo planes to British Airways this year after securing a program-saving deal from Persian Gulf operator Emirates, according to people familiar with the matter.

The U.K. carrier, which currently has 12 A380s in its fleet, had said in the past that it was looking for six to seven second-hand A380s. Now it’s considering taking a larger number of new ones, said the people, who asked not to be named because the discussions are private.

Airbus’s outgoing head of sales, John Leahy, said on Bloomberg Television Friday he was confident the European planemaker would secure one more A380 order this year. That customer is British Airways, the people said. Airbus, based in Toulouse, France, and BA parent IAG SA declined to comment.

British Airways is interested in the superjumbo because of the jet’s ability to maximize the number of passengers per flight at its London Heathrow hub, which is running close to capacity limits. The carrier’s main focus is on North Atlantic routes that are among the world’s busiest long-haul services, and it ranks as the No. 1 operator of Boeing Co.’s 747 jumbo, the second-biggest passenger plane after the A380.

BA is examining a deal for new planes after concluding that refurbishing used examples of the Airbus behemoth for its own needs would be too expensive, one of the people said. The carrier’s superjumbos are fitted out in a four-class configuration featuring 469 seats, according to its website.

Order Drought

IAG Chief Executive Officer Willie Walsh has been mulling the business case for second-hand A380s for as least two years, with planes becoming available as the oldest ones come off lease from Singapore Airlines Ltd. after a decade of service. Walsh also ran the rule over six younger aircraft deemed surplus to requirements at Malaysia Airlines Bhd.

An order for new double-deckers from IAG would help vindicate Airbus’s efforts to save the A380, which Leahy said Monday might be scrapped after failing to attract a buyer for more than two years. That was before Dubai-based Emirates announced its deal for as many as 36 planes worth $16 billion.

While Airbus says that order will keep the A380 production line going for more than a decade, it’s still looking at slashing build rates to just six annually from 12 this year. Follow-on orders from carriers such as British Airways are therefore still vital in lifting the annual tally to a level where the manufacturer can break even on each plane.

©2018 Bloomberg L.P.