Airbus SE’s decision to shut down the A380 program has been a long time coming, but the blow is more to the European manufacturer’s pride than its pocket.
Right now, Boeing Co. is knocking spots off its rival in terms of cash generation and shareholder returns. The capacious A380 – a hit with passengers though not with airlines – made Boeing’s 747 jumbo seem rather diminutive. From 2021, when the production line closes, Airbus will have to give up those bragging rights. Without this symbol of Europe’s industrial might, it will seem more ordinary. Arguably, that’s a good thing.
Lessors and owners of A380 investment funds will be unsettled by the decision because it may impact the resale value of the aircraft. Yet for the manufacturer, it’s a logical and necessary step. The A380 isn’t an important source of revenue – accounting for just 2 per cent of the company’s aircraft deliveries in 2018 – and it doesn’t make money. Putting it out of its commercial misery is the kind thing to do.
