It’s no secret that Emirates’ President, Sir Tim Clark, is fond of the Airbus A380. However, as demand for travel returns, he believes that the type will be more viable than ever, thanks to falling fuel prices. After all, fuel is a significant expense when running an airline.
The last 12 months have been pretty grim for most airlines around the world. However, there have been a couple of silver linings here and there. When most of the global fleet was grounded, a lack of demand led to fuel prices plummeting. This meant that some could fill up the aircraft that they were flying on the cheap.
Low fuel prices are great for the A380
While the performance of the A380 has underwhelmed some airlines, Emirates is not one of these airlines. According to Clark, before the COVID-19 pandemic, the Airbus A380 was always packed on routes that it flew.
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Clark told Simple Flying that before the pandemic, 85% of the airline’s profits came from the Airbus A380, showing how effective it was for the carrier. He went on to add,
“We see that continuing. Fuel at the moment is priced at a level that makes [the A380] even more viable, more profitable for us.
Why is the A380 profitable for Emirates?
The A380 is an interesting aircraft from an economic standpoint. With four massive engines, the aircraft gets through an awful lot of fuel. This can be a problem if airlines can’t fill the plane, as the aircraft is uneconomical to run if half empty. For the airlines that have scrapped the A380, one challenge was filling the giant of the skies.
However, when full, the A380 can be a real moneymaker, as Emirates has shown. If the airline keeps flight tickets at the same price but is spending less on fuel, it follows that profits will increase for the airline. This is a bonus for the airline. Clark also told Simple Flying that Emirates intends to fly the A380 for the next 15 years.
What’s happening with the price of fuel?
Since the start of the pandemic’s impact, the price of aviation fuel has changed rapidly. According to IATA’s estimates, the average cost of a barrel of aviation fuel in the Middle East and Africa currently sits at $62.33, making it the cheapest region for fuel. While this is a 168.2% increase from a year ago when the first wave hit the aviation industry, it is down 10% from a month ago.
According to IATA’s price tracker, a barrel of jet fuel cost around $80 per barrel right before the pandemic started to hit fuel prices. The pandemic caused prices to drop to just $15 per barrel at the end of April 2020. However, jet fuel prices have since shown some signs of recovery.
Do you think lower fuel prices make the Airbus A380 more viable? Let us know what you think and why in the comments!