CAPA: SQ to retire A380s coming off lease

[leops1984]

Interesting article from CAPA re the A380:

http://centreforaviation.com/analysi...ampaign=buffer

The bits that are SQ-related:

• Five A380s to be delivered in 2017/2018
• Will be used to replace existing aircraft coming off lease
• Older A380s don't have programme/efficiency gains of later models
• Even with lease discounts, early A380s not "viable to operate".

[FN-GM]

Nothing new to be honest, this was known about when they made the order for the extra 5.

[SQ228]

Would this mean we are unlikely to see PEY installed in SKB-E then? I'm figuring they used SKA as a guinea pig given it's the least valuable of all the early ones in terms of resale.

[FN-GM]

I'm figuring they used SKA as a guinea pig given it's the least valuable of all the early ones in terms of resale.

SQ do not own the Aircraft so it shouldn't matter to them.

[SQ228]

SQ do not own the Aircraft so it shouldn't matter to them.

Would they need to negotiate permission to modify them from the lessor?

[vasqflyer]

Interesting article from CAPA re the A380:

http://centreforaviation.com/analysi...ampaign=buffer

The bits that are SQ-related:

• Five A380s to be delivered in 2017/2018
• Will be used to replace existing aircraft coming off lease
• Older A380s don't have programme/efficiency gains of later models
• Even with lease discounts, early A380s not "viable to operate".

It will be interesting to see what happens to the 3 other A380s that are leased.

[FSJZ]

Oh dear the fate of the A380 programme looks bleak :/

[726]

never was a fan of A388. In fact I avoid it whenever possible. Too many people waiting for boarding, and hated queuing at immigration afterwards.
I'm a fan of B78x series and A330 series.

[saobangpo]

hmm interesting

[hjerapa]

Interesting follow up article :

http://www.bloomberg.com/news/articl...ngapore-planes

[leops1984]

There was a discussion of that article on airliners.net. That $25 million they mentioned is the most that SQ must pay IF the leased A380s are not returned in "full life" condition. It will cost SQ far less to have the A380s returned to that condition (or as close to it as feasible), so the incentive to keep the early-build A380s are far less than implied.

There's probably a lot of negotiating-in-public going on here.

[vasqflyer]

There was a discussion of that article on airliners.net. That $25 million they mentioned is the most that SQ must pay IF the leased A380s are not returned in "full life" condition. It will cost SQ far less to have the A380s returned to that condition (or as close to it as feasible), so the incentive to keep the early-build A380s are far less than implied.

There's probably a lot of negotiating-in-public going on here.

Agreed. I suspect Dr Peters are trying to get SQ to extend by a few years (maybe the 2 refereed to in the article) to extract as much value out of the aircraft as they can. Even if SQ were to spend the full $25 million, it would not help Dr Peters if they cannot find anyone else to take the aircraft which is likely owing to the large cost of retrofitting them with new products. Best case for them is SQ extends a little and then they can scrap the aircraft as suggested by CAPA. The extension might give SQ flexibility to retrofit the full fleet with the new products being introduced in the new aircraft too

[SQ228]

Agreed. I suspect Dr Peters are trying to get SQ to extend by a few years (maybe the 2 refereed to in the article) to extract as much value out of the aircraft as they can. Even if SQ were to spend the full $25 million, it would not help Dr Peters if they cannot find anyone else to take the aircraft which is likely owing to the large cost of retrofitting them with new products. Best case for them is SQ extends a little and then they can scrap the aircraft as suggested by CAPA. The extension might give SQ flexibility to retrofit the full fleet with the new products being introduced in the new aircraft too

Yeah, I can't see SQ refitting them unless they plan to keep them and that seems unlikely. I think your idea isn't a bad one. Depends on the financial terms offered.

If there are really no genuine buyers for them, they could offer SQ a deal where they only pay for the percentage of time during the year that they fly them. That would allow seasonal upgauges to occur more frequently without the need to have them in the air during low seasons. I see that dilemma as the biggest disadvantage of the A380 and if it's a lessor's market, it would be better than parking them at VCV, letting them deteriorate and earning nothing...

[FN-GM]

Some of the A380's coming off lease maybe headed to BA - http://leehamnews.com/2016/01/18/iag...medium=twitter

Unless they are coming from MH?

[leops1984]

Some of the A380's coming off lease maybe headed to BA - http://leehamnews.com/2016/01/18/iag...medium=twitter

Unless they are coming from MH?

Could be TG as well.