UK

Airbus accused of reigniting ‘Project Fear’ after issuing Brexit threat to pull out of UK

An Airbus SAS A380 super jumbo performs a flying display on day two of the 51st International Paris Air Show in Paris, France, on Tuesday, June 16, 2015

Airbus has been accused of reigniting “Project Fear” for political reasons after the European planemaker threatened to pull out of the UK in the event of a “no deal” Brexit. The aerospace giant, which employs 14,000 people at 25 sites across the country, said it would “reconsider its investments in the UK, and its long-term footprint in the country” if Britain crashed out of the single market and customs union without a lengthy transition agreement. But Brexiteers said you “couldn’t have a more politically motivated threat than this” and suggested Airbus was seeking to pressure the Government into staying as close as possible to the EU in order to protect its own “narrow, vested brexit3interests”. Airbus set out its stance in a “risk assessment” published on its website in which it also called on the Government to extend the Brexit transition period which is currently due to run until December 2020 if a deal is agreed. It said the proposed transition was too short for the business to reorganise its supply chain and that if there was no extension it would “carefully monitor any new investments in the UK and refrain from extending the UK suppliers/partners base”. But Peter Bone, the leading Tory Brexiteer, said: “It is just another part of Project Fear. I have given up counting how many times people have said it will be the end of the world. They are not going to pull out. “They are just trying to put pressure on the British Government because they want us to continue to be a part of the European Union. You couldn’t have a more politically motivated threat than this and I don’t believe for one minute that Airbus would move from the UK.” Nigel Farage, former Ukip leader, said it was “hardly surprising Airbus are threatening us today when they’ve taken billions in EU funding” as he also questioned whether the company would pull out of the UK. He told Sky News: “Twenty years ago I heard car manufacturers saying if Britain didn’t join the euro they may well consider pulling out of Britain – Nissan, others like that. “We build the wings in this country. If they close down production it would take them at least two years to put that back in place somewhere in France or Germany. “Big business will always lobby for their interests, of course they will. I understand that.” Meanwhile, John Longworth, the co-chairman of the Leave Means Leave campaign group, said: “The latest scare story from Airbus screams of more Project Fear. “The French-run Airbus is a classic multi-national business that clearly doesn’t care about the UK as we embark on a new post-Brexit future, because it is intrinsically wrapped up in the EU and trying to undermine the UK Government’s negotiating position.” Tom Williams, the chief operating officer of Airbus Commercial Aircraft, told BBC Radio 4’s brToday programme the firm was “becoming increasingly frustrated with the lack of clarity” over Brexit and “obviously time is running”. He said: “Now we have to come to the point where we have to make serious decisions. Quite often those decisions are long-term in nature and without clarity it’s too dangerous for us to proceed. “We’re talking about decisions in terms of safety stocks, buffer stocks of components, assuming that there will be chaos at the borders and that material won’t be moving freely. “We are talking about ‘do we invest in further capacity?’ And we are also talking about what will happen to components from suppliers to us and to airline customers, which today are certified under IATA rules and at the end of March next year those certifications will be invalid. Those components won’t be able to be fitted in aeroplanes.” Asked how soon decisions would have to be taken, Mr Williams said: “As we go through this summer, over the next weeks, we need to get clarity. We are already beginning to press the button on crisis actions. “The challenge of this is not a one-off decision. It will be a series of significant decisions that will accumulate as we go over the next couple of months.” He added: “When we look at the next generation of wings – which is called Wing of the Future – we are working on that today in the UK. Clearly now we are seriously considering whether we should continue that development or find alternative solutions.” Mr Williams insisted no political pressure had been put on Airbus to speak out. “I’m an engineer, not a politician,” he said. “I have to deal in certainty. We can’t continue with the current vacuum in terms of clarity.” The Airbus row comes after Philip Hammond, the Chancellor, warned the EU against an “ambition to force the location of business into the EU”.

A380

Why is the world’s largest passenger plane facing the scrap heap?

Airbus has confirmed it is preparing to end production of the world’s largest passenger plane after receiving no new orders in two years. The A380 was launched to much fanfare in 2005 with commentators declaring it the future of aviation. But just 13 later, and with only 222 units delivered, the entire project is on the brink. Airbus says it must build at least six of the planes each year to keep the programme running, and had been banking on a new order in November from its biggest customer, Emirates. However, the Dubai carrier chose to purchase 40 Boeing 787 Dreamliners instead. Yesterday John Leahy, Airbus’s sales director, admitted that only Emirates could save the superjumbo. “We are still talking to Emirates, but honestly, they are probably the only one to have the ability right now… to take a minimum of six per year for a period of eight to 10 years,” he said.  “If we can’t work out a deal with Emirates there is no choice but to shut down the programme.” Emirates bought 50 A380s in 2013, but since then Airbus has only received one more order for the model, when Japan’s ANA bought three jets in January 2016.

What went wrong for the A380?

The jet has been widely praised by passengers for offering a smooth and comfortable flying experience, but the economics of operating it have proved off-putting for airlines. Simply put, every service needs to run at close to full capacity for carriers to make money. Airlines are instead opting to buy medium-sized planes, such as the Dreamliner, the A320neo, which launched in 2016, and the A350, introduced in 2015. Independent air transport consultant John Strickland told the Telegraph: “The A380 is a well regarded aircraft by airlines which operate it and by customers flying on it. Generally, however, twin-engine aircraft such as the Airbus A350 and the Boeing 777 reduce the financial risks involved with filling capacity and operating costs.” Last year Singapore Airlines, the A380’s first customer, started putting its superjumbos into storage, while in November an Irish aircraft leasing company said it was considering creating its own airline because it couldn’t find anyone to borrow its A380s.

Which airline owns the most A380s?

Emirates, by a long way. With a fleet of 100, it’s one of the few carriers able to get the maximum value out of the four-engine A380, and has made it the core of its long-haul fleet. Other airlines have ordered them in far smaller quantities: British Airways, for example, has 12 of them in its fleet of 270 aircraft.

How many orders are outstanding?

Production rate of the aircraft is falling fast, from 30 a year in 2014 to 15 in 2017, 12 this year, and eight next year. “We will deliver 12 aircraft as planned in 2018,” said Airbus’s chief operating officer Fabrice Bregier. “The challenge will be to maintain at least this level in the years to come.”

Can new markets save the A380?

Airbus had been hoping Chinese airlines would help revive the superjumbo. China will be the world’s biggest air travel market by 2022, according to the International Air Transport Association. But John Leahy’s comments this week would suggest these hopes are fading. Besides, China has spent the last decade developing its own plane manufacturer: Comac. Its first purpose is to reduce the reliance on Boeing and Airbus planes on China’s domestic air network – but the Far East’s rising super-power also has ambitions to take its investment in aviation beyond its borders.

What’s the next biggest passenger plane?

Hypothetically, should every single A380, capable of carrying 853 passengers in a single class, be grounded, the Boeing 747-800 would become the largest passenger aircraft in the world, capable of carrying 700 passengers in a single class.

But isn’t the 747 falling from favour?

Correct. Last month United waved goodbye to its final 747 with a farewell flight from San Francisco to Honolulu (recreating the route of its first 747 service in 1970). Not one US carrier now flies the iconic Boeing aircraft, which – after almost 50 years of tireless service – is gradually disappearing from our skies. Even it’s biggest customer, British Airways, is phasing it out of its fleet. It currently has 36 jumbo jets, according to the website Airfleets.net, but a further 34 have already been placed in storage and it has said the model will be gone from its hangars by 2024. Demand for the 747, which has been tweaked and upgraded many times since its first flight in 1969, has dried up. No new orders were received last year and it is expected that Boeing will be forced to call time on the jumbo jet before long. Since 1969 Boeing has produced more than 1,500 747s. But around two-thirds of these have now been scrapped, written off, or placed in storage at one of the world’s aircraft graveyards.