Thai Airways May Cancel A380 Jet Order

[Ricardo]

Compared to qantas, these days, Thai IS a good airline. thats a bad comparison as qantas has slipped to the level of a second rate airline too.same problems as Thai..crappy old planes, indifferent and surly crew,profit at all costs obsessed management, indifference to their core customers, and a slipping safety record. they have become an embarrassment to australia.

However at least Qantas manage to renew their fleet, having taken delivery of their first A380 recently, I believe ? It is ideally-suited to their long-haul routes, where it will finally replace the 1960s-era Jumbo-design, on high-density routes between major hubs.

Airbus has always been in a jam from the start they are behind in manufacturing and thus delivery.

Unfortunately this is true of just about any new aircraft, such as the Boeing-787, for example ... how many years late ?

I loved the on-time roll-out ceremony, with bands playing & flags flying bravely, before it was wheeled back into the production-hall, because it wasn't actually finished yet. But enough of this partisan Airbus vs Boeing -bashing ...

Thai Airways have a problem. They have failed when profitable to modernise their fleet fast-enough, or keep-up on cost-control & service-quality, and now they're facing aggressive competition in a cut-throat depressed-market, from a range of new operators with different business-models, but all having more-modern (hence cheaper-to-operate) fleets.

On long-haul to Europe, or the transit-passengers on to Australia & the Far-East, they're being beaten on quality and price by the Gulf-based likes of Emirates, Etihad & Qatar. On regional and domestic-routes they're facing Low-Cost-Carriers, notably Air Asia & its subsidiaries, and winning less of the inbound-tourist market that they used to take for granted.

All of which is compounded by long-term poor management, cronyism and corruption.

And now they cannot afford to replace their elderly Jumbos with the A380, which is the correct long-term replacement, on those high-density long-haul routes which they had planned to use it for.

Long-haul passengers may well continue to arrive in Bangkok in large numbers, increasingly over-the-years having been carried on A380s or their future derivatives, but unfortunately it now appears that they won't be operated by Thailand's national carrier. I doubt those passengers will care.

[JoeThePoster]

Hope they dont get the deposit back. No thoughts about all the job losses this could bring to Airbus? How is it so easy to just cancel an order.

The order hasn't been cancelled yet. The 1-sided idea has been floated by Thai - it may well be just political posturing to pretend that someone is addressing Thai's economic woes.

Anyway, wait till they contact Airbus and their lawyers get on the job.

[churchill]

Thai Air May Become First to Ax A380 Passenger Plane

June 9 (Bloomberg) -- Thai Airways International Pcl said it may cancel Airbus SAS A380 orders, threatening to become the first customer to scrap contracts for the passenger version of the world’s largest commercial plane.

“We need to determine whether it’s worth the large investment,” President Narongsak Sangapong said by phone today from Kuala Lumpur. The Bangkok-based airline, with six A380s on order, has begun a review which may lead to the planes being axed or delayed, he added.

Emirates Airline, the largest A380 customer, also said today it may join Air France-KLM Group and Deutsche Lufthansa AG in delaying planes as the global recession hammers travel. Customer delays may lengthen the time Airbus needs to recoup spending on the A380’s development, which has ballooned to about $18 billion from the originally planned $12 billion on cost overruns and penalties.

Emirates may defer as many as 10 planes, either A380s or Boeing Co. 777s, beginning in about 18 months, President Tim Clark said in an interview today. Still, Clark reiterated that the Dubai-based carrier wouldn’t ax any of the 53 A380s it has on order. The airline is already flying five of the planes.

Delays, Cancellations

The A380 program has suffered two years of delays caused by manufacturing problems related to wiring systems. FedEx Corp. and United Parcel Service Inc. have also canceled orders for a total of 20 A380 freighters, forcing Toulouse-based Airbus to shelve plans for an all-cargo version.

International Lease Finance Corp. is also re-examining its order for 10 A380s, according to WirtschaftsWoche. The magazine cited an interview with Steven Udvar-Hazy, the leasing company’s chief executive officer, yesterday in an advance report ahead of its next edition. The A380’s list price is $327 million, though the earliest customers for planes got discounts.

Airbus has scaled back production of the A380 this year as customers resist taking large planes on the travel slump. The planemaker plans to hand over 14 of the double-decker aircraft this year, down from 18 previously, it said on May 6. Airbus has 200 orders for A380s, of which 15 had been delivered by the end of last month, according to data on its Web site.

International air travel fell for an eighth straight month in April as business and leisure passengers pared flights because of the recession. Price cuts and the impact of swine flu may cause airlines to post combined losses of $9 billion this year, almost double a previous forecast, the International Air Transport Association said yesterday.

Yields may drop a further 5 percent to 10 percent before reaching their bottom, Emirates’ Clark said today.

http://www.bloomberg.com/apps/news?pid=206...id=a5FgOx.UlNbc

[OnNutter]

Thai Airways may cancel A380 jet order

THAI reconsiders costly jumbo jet deal

KUALA LUMPUR: -- Thai Airways International (THAI) seems poised to cancel its order of six A380 superjumbo jets, which it considers not viable for its operations and, at a total cost of about US$1.8 billion, too expensive to fund.

Wallop Bhukkanasut, chairman of THAI's executive board, revealed the national carrier's revised stance on procuring the world's largest civil aircraft, which it agreed to purchase back in 2007 when the carrier [more...]

-- Bangkok Post 2009-06-09

How stange! last week when I returned to BKK there was a big Airbus/Thai Airways reception at Swampy for the delivery of the A380's. All the TV and press where there, big wigs and politicians chowing down on the free buffet at what seemed was the official handover ceremony!

[thaigold]

The A380 is dead meat...as it was, since it's inception. A modern day Edsel...

[jackdanielsesq]

I believe the A380 amortization period was 25 years.

100 years looks more like it at this rate of travel.

BR>Jack

[paulchiangmai]

Good grief...what a bunch of miserable s.o.b.'s the vast majority of you people on here are! Such colonialist, superior and arrogant attitudes and points of view. While maybe not as great as Quantas or some others, THAI is vastly superior to many (if not most) international airlines. And the belief that all things Thai must come with a back story, hidden agenda or potential scam is ridiculous. Why do so many of you live in Thailand and continue to travel there if you are so jaded and dissatisfied? Do all of us (and the Thai people as well) a favor and pack your bags or zip your lips!

Not as great as Qantas? Tell me your joking.

[paulchiangmai]

Good grief...what a bunch of miserable s.o.b.'s the vast majority of you people on here are! Such colonialist, superior and arrogant attitudes and points of view. While maybe not as great as Quantas or some others, THAI is vastly superior to many (if not most) international airlines. And the belief that all things Thai must come with a back story, hidden agenda or potential scam is ridiculous. Why do so many of you live in Thailand and continue to travel there if you are so jaded and dissatisfied? Do all of us (and the Thai people as well) a favor and pack your bags or zip your lips!

Not as great as Qantas? Tell me you 're joking.

[wackysleet]

The A380 is dead meat...as it was, since it's inception. A modern day Edsel...

Is this just your opinion or do you know some little secret?.

[toret]

The main reason Thai Air is stuck with 6 A380's it doesn't want is because the EU twisted Thailand"s arm way up its

back with the threat that if Thailand didn't buy their crappy aeroplane then Thailand would might well face extra tariffs when exporting goods to Europe etc etc.

The joint european Airbus project had to be seen to be successful so they used their power to force smaller countries to buy.

I am sure that six expensive impractical aircraft were the last thing the management of Thai Airways wanted.

I find that a very believable statement.

If not mistaken I remember Mr. T threatening with cancelling the Airbus deal if the EU stopped importing thai rice, after it was found it had unacceptable levels of pesticides or some other chemicals in it.

[peecee]

I too made the mistake of flying Thai after a long self imposed absence. The kite was dirty and the interior shabby, as for in-flight entertainment less said the better! The crew did a reasonable job but I noticed a more tardy drink's service than before. Wilst in the cruise I noticed a fluid leak from the port wing, the crew took foto's and my details & on leaving the chief purser told me that the captain would get the company to write to me about the technical investigation of what was clearly a flight safety hazard. That was in January & I'm still waiting!

[peecee]

The A380 is dead meat...as it was, since it's inception. A modern day Edsel...

Is this just your opinion or do you know some little secret?.

On busy routes flying near capacity you're getting far better environmental returns than other a/c so why is this jet dead?

[nookiebear]

Thai airways is not the only company suffering from the global money problems, and the related travel cutbacks. All mayor airlines are hurting bad. Contracts are being cancelled, aircraft are being stored, you name it, and it is happening.

Very true but how is it that a carrier as large as Virgin are making profits, is it because of the superior service they offer in relation to most other airlines?.

Virgin successfully hedged (I promise to pay X per barrell in month A, B, C) their fuel prices before the price of oil reach historical highs so this period did not impact them as much as the other airlines. However the extent of their hedging could be detrimental for next set results. They also nicely benefited from BA's <deleted> up at T5, so Virgin managed to grab a good share of BA's premium traffic, nicely time due to Virgin investments in better premium cabins in the previous years.

Also consider that Virgin operate only a small set of route, they are leaner than a national airline which carries an expectation to be full route service.

Admittedly though a reputation and consistency of service will carry some weight, and if they aim to the same standards of Singapore Airlines then this is promising, but remember though most airlines will need a load of 80% plus to be profitable including 5 star airlines such as Singapore Airlines (all three sectors were <50% full last time as an indication) so expect some rough results ahead,

Virgin have always been in the fortunate position to 'cherrypick' their routes,unlike BA............

[nookiebear]

Thai Airways may cancel A380 jet order

THAI reconsiders costly jumbo jet deal

KUALA LUMPUR: -- Thai Airways International (THAI) seems poised to cancel its order of six A380 superjumbo jets, which it considers not viable for its operations and, at a total cost of about US$1.8 billion, too expensive to fund.

Wallop Bhukkanasut, chairman of THAI's executive board, revealed the national carrier's revised stance on procuring the world's largest civil aircraft, which it agreed to purchase back in 2007 when the carrier [more...]

-- Bangkok Post 2009-06-09

How stange! last week when I returned to BKK there was a big Airbus/Thai Airways reception at Swampy for the delivery of the A380's. All the TV and press where there, big wigs and politicians chowing down on the free buffet at what seemed was the official handover ceremony!

I think what you saw was the big party due to Emirates commencing flights to/from Dubai using the A380,ON June 1st.

[nookiebear]

The A380 is dead meat...as it was, since it's inception. A modern day Edsel...

Reading that statement leads me to believe you know absolutely nothing about the aircraft industry....I've only spent 42 years as a 'Licensed Aircraft Engineer'...............

[Carib]

The A380 is dead meat...as it was, since it's inception. A modern day Edsel...

Reading that statement leads me to believe you know absolutely nothing about the aircraft industry....I've only spent 42 years as a 'Licensed Aircraft Engineer'...............

Something is going wrong with the quoting, post removed

Edited June 9, 2009 by Carib

[wackysleet]

Admittedly though a reputation and consistency of service will carry some weight, and if they aim to the same standards of Singapore Airlines then this is promising, but remember though most airlines will need a load of 80% plus to be profitable including 5 star airlines such as Singapore Airlines (all three sectors were <50% full last time as an indication) so expect some rough results ahead,

Virgin have always been in the fortunate position to 'cherrypick' their routes,unlike BA............

I'm sure you will remember that the old BOAC Co and BEA had the UK market sown up with their planes on every available route, and I am sure you also know that BOAC and BEA were making profits, BOAC and BEA merged and new airlines started to get a look in and undercut what then became BA in what was to become a free market and we all know the tricks BA did in an attempt to stop Virgin getting a foothold in the north american market, unfortunately they started to lose out to the budget airlines even starting one of they're own, so what happened to that?........ your quote over simplifies the position.

[cosmont]

Thai air initially planed to replace old and costly Boeing 747/400 by A380 for some congestioned destinations.

The cancelation fees will be Huge, they might think to swap to A350 long liner and negociate with Airbus...

Thai Air need a strong audit if they want to cut expenses

Edited June 9, 2009 by cosmont

[Lopburi99]

I have never flown Thai but wifey has, most recently last month back to BKK from LHR.

Her opinion was that the plane was very old and dirty with no seatback IFE. Cabin crew were 'very old' and disinterested.

It was very poor compared with the outgoing flight with Etihad for which she had nothing but praise.

If Thai are no unable to ungrade their deteriorating long haul fleet I can only see them losing even more of what should be their core customers.

The seats do look old and look like something out of the 60's. Food sucks too and the stewards can be balshy. I'll not fly with Thai anymore. Too expensive as well.

I think the profits go into pockets and not on improving the fleet or service. Mind you, it's like other Thai companies that have got big and provide a shoddy service.

True Internet - sucks

UBC - sucks

Some Thais told me they believe that the TG stands for "tomorrow go" because they are always late or have delays.

Personally I fly EVA and apart from the food, think they offer a great service and value for money

Reminds me of LIAT Airlines I used to take when going to St. Vincent from Barbados in the Caribbean many times. LIAT surely stood for "Leave the Islands Another Time!" They'd often just close the ticket counter and go home if there were too few customers...and they didn't give a rip about doing it either.

Edited June 9, 2009 by Lopburi99

[SantiSuk]

Thai Airways - up to 3 times more expensive than Air Asia on the Ubon Ratchatani route - RIP!

[in fairness they do give you a cup of coffee and a sticky bun to compensate for your extra 3,000 baht]

Edited June 9, 2009 by SantiSuk

[bino]

Reminds me of LIAT Airlines I used to take when going to St. Vincent from Barbados in the Caribbean many times. LIAT surely stood for "Leave the Islands Another Time!" They'd often just close the ticket counter and go home if there were too few customers...and they didn't give a rip about doing it either.

Ahhhh.... LIAT... great memories- typical Caribbean. Loved and hated them at the same time for the kind of stunts you describe! Another apt anagram for them: Luggage In Another Terminal.

[Carib]

Reminds me of LIAT Airlines I used to take when going to St. Vincent from Barbados in the Caribbean many times. LIAT surely stood for "Leave the Islands Another Time!" They'd often just close the ticket counter and go home if there were too few customers...and they didn't give a rip about doing it either.

Ahhhh.... LIAT... great memories- typical Caribbean. Loved and hated them at the same time for the kind of stunts you describe! Another apt anagram for them: Luggage In Another Terminal.

Yes LIAT ...say no more.. but..... they are still around for 50 years now. It is beyond me how they did it. On the other hand it is a part of the Caribbean ways and lifestyle, there always is another day..

[clioclio]

Thai Airways is not a private company, it belongs to the public, and their management style reflects that, the board is appointed

by the government, (and it's a well sought position bonuses free ticket for family + friends for the rest of their life etc...), none of the board come from within the company, the board is changed every time the government changes, so at the helm of Thai we have non qualified people and no long term strategy is implemented, every time there is a new board new aircraft are ordered, re- negotiation of old orders....

aircraft acquisition is a lengthy process, airline don't just an aircraft because it's new and it's flashy, (maybe the only companies that did that are the middle eastern one, they have huge capital they can tap from, what is a company going to do with 53 A380 if only less the 10 airports worldwide can service them?) , if an airline decide to by A380 it's because it it has done it's homework .... infact thai has ordered 6 of them, to service 3 routes (one route needs 2 aircraft if the frequency is daily) London Frankfurt and Sydney. Thai Airways was hit hard in the last 2 years, Fuel prices, Global Economic Crisis, Swine Flu, Coup d'etat, airport ocupation etc. and it's not something unexpected that their plan had to be changed... Personaly i don't think that the order will be cancelled they need new aircrafts and with that capacity in those routes {by the way no shower/sauna/spas or 1st class personal cubicles in the thai A380 configuration}, maybe the'll opt for B777 which are more flexible to operate...

Personaly i prefer the cabins of Boeings compared to similar Airbuses ie B777 and A34x, they are wider and higher, more room to breath...

for those whom the price is the main concern, even with 380s thai ticket prices will not go down,

evacuation : if i remember well the was an airfrance aircraft that overshoot the runway and all the passenger and crew was evacuted without major injuries, the training of the crew was superb, so don't call them waither their main duty is to evacuate us from the aircraft as fast as possible and as safely as possible...their duty is to give first aid, CPR AED etc... during the flight.

[clioclio]

Thai Airways - up to 3 times more expensive than Air Asia on the Ubon Ratchatani route - RIP!

[in fairness they do give you a cup of coffee and a sticky bun to compensate for your extra 3,000 baht]

then you are right to choose air asia, you are lucky that you can choose....

[mrdome]

Strange nobody has mentioned this yet, the one good thing Thai were always known for was 34 inches legroom in economy.

It is shocking how just so not interested Thai has acted over the years to roll out a new business or first class product when others were doing it. There is a certain arrogance behind THAI I feel. In the product, pricing, the whole package.

For a different comparison experience, last year I flew LHR - KUL on MAS and back on KLM. I really liked everything about MAS (although they had thoroughly p*ssed me off 2 years earlier when several mishaps occured) but the return on KLM was just bad. KLM never again.

[LazarusLong]

While Thai Air has been lambasted for poor management and massive corruption, this is a wise decision. Buying new planes in the middle of a global recession is not prudent. Anyway- I haven't flown TG in years as their prices just aren't competitive anymore...

Folks,

Gotta get a bit of sense into this topic.

1) It IS wise to BUY aircraft just now. Because of financial crisis and recession you get discounts previously unheard of, especially if you take over slots from cancelled orders. However, you should be able to pay cash - that"s why Air Asia, Air NZ, Emirates, Quatar, Etihad and others placed huge orders.

2)ILFC, the worlds biggest AC leasing co has hinted they may cancel their A380 order as well.

Three reasons: a) ILFC, although itself healthy, suffers from refinancing problems as their parent AIG just went down the gutter. They may just want to negotiate a steep discount

c)Probably the best: ILFC hinted in a press release the because of declining passenger traffic the market just isn"t there to operate 500-seater aircraft. I totally agree.

2) United wants to buy 150 aircraft, but only the less costly twin-engine jets (787, 777, 350, 340). Its seen as a bit of an issue as UA does NOT have the necessary cash.

Please do not come up with conspiration myths and statements how poorly TG is managed. I am NOT a TG employee (and have never been) but a customer of TG who has suffered his share. However, TG is BETTER than most - and if they weren't obliged to fulfill certain crazy Thai governmental obligations they WOULD have more cash and better service.

It certainly was nuts to buy those A 340 for the JFK route (which is now cancelled and the 340 parked as these gas-guzzlers have no buyer) and ultimately the 380, but alas, that is politics...Thailand has received EU Support for placing orders. There may have been bribes or not, but that is no specific Thai issue - care to remember how Air Canada placed that big Airbus order in the early 80 ? Germany still tried to get a hold of Gerhard Schreiber :-).

If you don't like TG fly with other carriers, there's plenty of options. For me TG, GF and BR are still my personal favs.

What TG really needs are 3 or 4 777/200F's - as ridiculous it seems, THai doesn't have a freighter any more and they're in dire need of it. Retrofitting their old 744's to BCF's makes little sense, so the cash for the unneeded 380 is wiser spent on upgrading their fleet with 773's and 788's Pax and 772F's.

If you want to follow that up just check airtransportworld and atwonline.

Cheers, Laz

[isanb]

I do think, this fat fuc_ker of an A380 isn't the future at all. Supersonic travel is the future. Who want's to sit 10 hours, while he can do it in 3? The main problem is fuel, the Russians are allready doing a Supersonic liner project, but it remains silent for the world. Concorde was a fine piece of engineering, I't never crashed during it's 27 years of operation, only 1 due debry on the runway from an old plane, take took of before the Concorde. BA wanted the plane to remain functional, but Airbus said NO. They blaim the plane to suck fuel with it's afterburners on, that's nonsense. 2 engines of an A380 produce almsot the same thrust as all 4 Concorde's engines.

The whole reason: MONEY, MONEY, MONEY as always. A380 can stuff more people, so more money.

yes but an A380 carry till 800 folks and concorde only 100 witch make a big difference when you pay the ticket if i remember well the price for a Paris/NY was around 5000 euros with concorde so i'd rather sit 10 hours in the plane than work a couple of month just to pay the plane ticket

Edited June 9, 2009 by isanb

[mau]

Just type in google "canceling A380 orders"

You will find others to cancel as well.

[Kf6vci]

If utilised well, the Airbuas A-380 should be a money maker! What is the operational savings versus the Boeing 747s, some of those are pretty old? 25%?

I flew this plane from Dubai. Very quiet, great entertainment system. But not enough toilets.

Maybe Thai Airways won't fill 6 planes, but they should manage to fill 3. LHR, FRA and a code share...?

The reason for the A-380's success is that it makes financial sense to buy it. Whatever else is wrong with Thai Airways, this order is their chance to make a profit on key routes!

[Carib]

I do think, this fat fuc_ker of an A380 isn't the future at all. Supersonic travel is the future. Who want's to sit 10 hours, while he can do it in 3? The main problem is fuel, the Russians are allready doing a Supersonic liner project, but it remains silent for the world. Concorde was a fine piece of engineering, I't never crashed during it's 27 years of operation, only 1 due debry on the runway from an old plane, take took of before the Concorde. BA wanted the plane to remain functional, but Airbus said NO. They blaim the plane to suck fuel with it's afterburners on, that's nonsense. 2 engines of an A380 produce almsot the same thrust as all 4 Concorde's engines.

The whole reason: MONEY, MONEY, MONEY as always. A380 can stuff more people, so more money.

yes but an A380 carry till 800 folks and concorde only 100 witch make a big difference when you pay the ticket if i remember well the price for a Paris/NY was around 5000 euros with concorde so i'd rather sit 10 hours in the plane than work a couple of month just to pay the plane ticket

True, you cannot compare these two planes. Each cover(ed) a completely different segment in the market.

Datsun, you are saying the Concorde was a fine peace of engineering, but it was fly by wire, and you seem to be very much against that if I remember well, please correct me if I am wrong.

The engines on Concorde did use a lot of fuel, the optimum fuel performance ratio was at mach 2 or above. At lower speeds or even taxiing they drained the tanks.

It was a very very expensive plane to maintain and fly.