What will the carrier do with 90 A380s?

This week, Emirates boosted its A380 order by 32. By 2017, airbus' major customer will have taken delivery of 90 new super jumbos. Routes News investigates where these aircraft could be deployed and the rationale behind this huge order.

From Dubai, Emirates currently serves nine routes non-stop using its flagship A380, as well as a tag flight from Sydney to Auckland. When you combine the combined weekly frequencies of its biggest aircraft, this amounts to 73 flights a week on the A380. The table below illustrates the A380 schedule from Dubai on a weekly basis.

Source: Flightbase: 14-20 September, 2010

How does Emirates justify its order for 90 addition. In existing markets the A380 has, and will allow Emirates to maximise capacity per aircraft movement. This is particularly important in heavily slot-constrained markets, such as at London Heathrow, Frankfurt, Narita and Sydney. The A380 will also allow Emirates to compete on a lower seat cost with competitor such as Etihad in Manchester.

Where else will the A380 help Emirates? Looking at its hub, Emirates can of course use the aircraft to increase traffic flow through Dubai, making it a focal point for connecting traffic and will seek to balance traffic flows on either side of the hub.

But with a small home market in Dubai, local traffic will evidently not support such a huge order - particularly when you consider Emirates' average seat capacity of 503 on the A380. Ninety A380 aircraft would place over 45,000 one-way weekly seats alone into the Emirates network. What is clear is that Emirates will seek to make Dubai the leading transit market in the world, competing for flows and trying to attract as much connecting traffic away from competing carriers..

The tables below illustrate some of the global traffic flows that Emirates may target with the A380.

NORTH AMERICA-ASIA

Interestingly, Emirates only carries 1% of all traffic from North America to Asia. This translates to over 346,000 passengers out of a total of nearly 30 million passengers.With North American traffic able to travel both eastbound and westbound, Dubai's geography means that it may not capture a significant share.

The top 5 carriers carrying passengers between North America and Europe are summarised:

Source: Airport IS March 09-10

EUROPE-ASIA

During March 2009-2010, traffic flows between Europe and Asia were larger, with over 55 million passengers flying between the two continents. Emirates accounts for 6% of this traffic, handling 3.1 million passengers. This places the carrier in second place in terms of market share. With a number of slot constrained airports and the passenger volumes on some of these markets, there are good target traffic flows for the A380.

Source: Airport IS March 09-10

AFRICA-ASIA

Between Africa and Asia, Emirates is the leading carrier for all O&D traffic.

Over 4 million passengers have flown between Africa and Asia between March 09-10 and the leading carriers are:

Source: Airport IS March 09-10.

IN WHICH MARKETS COULD EMIRATES BEST DEPLOY NEW A380s?

There will certainly be interest for Emirates to expand into China, as the carrier serves just three markets here from Dubai: Beijing, Shanghai and Guangzhou, with a total of 35 weekly flights and will no doubt place its A380 on Shanghai and Guangzhou in time.

Also with large traffic flows coming from India and Emirates' existing services to ten Indian markets, the country could be a big focus for the A380. The India to Dubai market has grown at a rapid rate since 2008, when just over 1 million passengers flew between the two countries. In 2010, this figure rose to over 1.7 million, helped by Emirates increasing capacity into India.(IATA BSP data)

The table below illustrates Emirates' five leading routes on the basis of passenger numbers that do not currently offer an A380 service. Some of these routes will be more appropiate than others for the A380.

Source: Airport IS

However there could be challenges ahead with the A380, as India has also tried to keep the A380 out of its market. Notably Lufthansa was refused permission from operating its A380 to Delhi by India's Ministry of Civil Aviation. Canada, too has restricted Emirates' growth with Emirates pushing to add capacity to capture large Asian flows in Canada.

Given that the A380 has less freight lift potential than the B747, Emirates will have to ensure that the economics are calculated on passenger lift. The A380 will require Emirates to grow its Dubai connecting flows. To achieve this, Emirates must strike a balance between feed and connecting traffic, ensuring that load factors are balanced in both directions.

In the medium-term, the order will place big demands on the pilot market. Only Emirates, Qantas and Singapore Airlines will have a sizeable pool of personnel to operate, fly and maintain the aircraft.