I was having a discussion with a friend the other day who works for FEDEX. He was conveying to me about how FEDEX had scrapped their plans on purchasing the freight versions of the A380 in favor of purchasing freight versions of the Boeing 777. The reasoning behind this was due to massive delays in delivery by Airbus.

Mind you this wasn’t new news as I researched this and found FEDEX backed out around November 2006.

I’m not at all surprised about this news, whether old or new. From Day 1 I have always believed the A380 to be a massive business failure that will make the company and each of the countries that cooperate to form Airbus hemorrhage money. Sure the plane is the world’s biggest for passenger capacity, has a fantastic range and computer systems galore but the motive for developing this airplane is late by around 30 years. The 787 by far has the future in mind in terms of avionics, airframe composites, interior comforts and vision of where the airline industry is headed. These are of course my opinions.

Let’s start with why Boeing and Airbus have developed such different aircraft. As all media outlets have been hitting upon recently, the visions are very different. The A380 was developed with your typical “hub and spoke” travel in mind, which has been occurring for the last 30+ years. Airbus still believes that passengers want to fly to hub cities like London, New York, etc.. and take massive aircraft to a hub near their intended destination. This would mean yet another regional flight to get to a destination that may nor cater to international travel.

Boeing believes a little differently. “Hub and spoke” service will never disappear but wouldn’t it make more sense to have an aircraft that was more flexible in it’s use? With security delays, airline delays and the cost of air travel getting more expensive, the company believes people just want to get to their destination as quickly as possible.

With the A380 the biggest concern is cost. First off, the plane itself costs between $292 -$318 million. Second, there are no airports large enough to handle this aircraft without spending millions of dollars themselves in upgrades to handle the logistics of the aircraft (i.e. double jet ways to handle passengers alighting and boarding, wider taxi shoulders to minimize turbine ingestion of debris and wider gates to make certain the wings don’t hit another parked aircraft). New York and Los Angeles seem to be the only two airports willing to cough up the $100 - $300 million to upgrade their facilities. Don’t bet every major airport will do this let alone a minor airport having the financial capacity to dream of it.

The 787 is far more economical in terms of costs. First the 787 costs around $138 - $188 million depending on equipment. Second airports can already handle a jet of this size as it is set to replace the aging 767. Not only can major airports like London, New York and Los Angeles handle this plane but so can smaller airports such as Manchester, Orlando and Seattle. The best part is airports don’t have to make any major overhauls or spend money on upgraded gate and taxiway design to handle this aircraft.

Both planes have a “wow” factor. In this I mean their amenities are top notch but again, I give the nod to Boeing. The Airbus relies on size for ease of travel. In First Class and Business Class there will be sufficient space to have your seat go back a full 180 degrees. Some airlines have envisioned First Class where each passenger will have their seat segregated from other passengers with what amounts to office cubicle walls and a few showers at hand to get freshened up prior to landing. That’s if you’re traveling in First or Business Class. Get into Economy Class and the A380 is your typical claustrophobic sardine can.

The 787 obviously is smaller than the A380 so segregated First Class seats may be a stretch but they will be nicer and roomier than Economy. However, in terms of comfort Boeing has taken into account climate control. This will be the first plane with a humidifier on board which means no more dry eyes, scratchy throats or dry noses which typically accompanies any long duration flight. The other thing is lighting that automatically gets dimmer or lighter depending on the time. This way it somehow helps a passenger acclimate to their destinations current time zone and thus lesses the effects of jet lag. In terms of engine noise, new sound suppression technology promises to lessen the sound of droning engines.

I could go on forever with a comparison of both aircraft. However, with as many delays surrounding the Airbus combined with a hefty price tag and asking airports to ante up the multi-millions of dollars to upgrade their facilities, I don’t see the company selling enough to break even. So far Airbus has 163 firm orders but their break even is 420. At $292 million per aircraft that’s $47.5 billion income compared to a break even point of $122.64 billion.

In comparison, Boeing has 634 firm orders for the 787. At $138 million per plane that’s $87.49 billion. I’m unaware what Boeing’s break even point is on this aircraft and whether they have released the figure; but with it’s total flexibility and current airport logistics able to handle the jet without any cost to upgrade their facilities, I believe Boeing will be the winner out of this competition.