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Things are changing…

Things are changing…

There’s an interesting movement in the types of planes which the large airlines are demanding.

10 years ago, the Airbus A380 or the “Super Jumbo” as it’s known, was launched with the aim to transform the airline industry by enabling up to 868 people to fly in one plane.

But things are changing and the anticipated demand for the superjumbos hasn’t materialised. Airlines are instead preferring smaller but more efficient twin-engine planes.

The most number of A380s that Airbus produced in a year was 30 but the order book has collapsed. Last week it was reported in Euronews that Airbus are exploring plans to cut A380 production to 6 aircraft per year.

Another company that has been affected by the drop in demand for A380s is the leasing company Amedeo.

Amedeo’s business model involves them buying aircraft from the likes of Airbus and Boeing and then leasing those aircraft to airlines.

Amedeo for example has purchased four A380s from Airbus and leased them on to Emirates.

The challenge for Amedeo though is that they have eight A380s in their portfolio and have another twenty on order from Airbus. Given that the demand for A380s from airlines has dried up, that’s not particularly good news for them.

However, they have come out fighting and announced that they will be launching their own airline.

Instead of simply leasing the plane out, the new business model will involve them running things as an airline. They will offer seats to existing carriers who will provide the ticketing service but Amedeo will operate the flight using their own cabin crew.

As well as offering the flights to existing airlines, Mark Lapidus the chief executive of Amedeo raised the prospect of providing flights for potential partners such as Airbnb.

Time will tell how successful this will be but it certainly is a novel approach to trying to find a solution to what to do to address the fall in demand.

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