Abu Dhabi, UAEWednesday 26 June 2019

Japan's ANA shows faith in Airbus A380 superjumbo

Airline to boost frequency of double-decker flights to Hawaii, convinced it can fill the vast jet with tourists flying from Tokyo

ANA is confident of success with the huge Airbus A380. Bloomberg
ANA is confident of success with the huge Airbus A380. Bloomberg

Just as a tide of cancelled orders has prompted Airbus to halt production of the A380 superjumbo, Japan’s biggest airline is betting it can succeed where others have failed - by filling the luxurious double-deckers with tourists flying to Hawaii.

Starting May 24, ANA has scheduled three flights a week from Tokyo to Honolulu on the 520-seat behemoths, painted in a special sea-turtle theme.

The carrier will bring on one more A380 for the Hawaii service in July and a third next year, ANA president Yuji Hirako said, adding that reservations for the route are already more than 40 per cent higher than a year ago.

The plan leaves ANA as the only passenger line with A380s on order, other than Dubai's Emirates, which has been the plane’s mainstay airline, Bloomberg said. The aircraft - which wowed travellers with in-flight showers, bedrooms and bars but was too big to win over most carriers - may help ANA close the Hawaii market-share gap with arch-rival Japan Airlines. Still, some question whether the carrier can keep filling the plane once the novelty wears off.

“ANA is spending a lot on advertising, so they will initially be able to fill the planes, but in coming years, it may get harder to consistently sell all the seats,” said Yasuo Hashimoto, chief researcher at Japan Aviation Management Research.

Japan Airlines, or JAL as it is known, has counted on Hawaii and the route has become one of the few where it surpasses ANA. JAL replaced ANA in a code-share partnership with Hawaiian Airlines in March last year and controls about 33 per cent of the Japan-Hawaii air travel market, compared with about 14 per cent for ANA, according to JAL.

“This is one of the few major routes where JAL dominates ANA,” said Mr Hashimoto. “If ANA can reverse that, that would be big. Their aim is to take at least part of JAL’s market share.”

Even with the added capacity, ANA won’t directly challenge JAL on some Hawaii routes. JAL offers Japan’s only direct flights to Kona, a hotspot on Hawaii’s largest island, and schedules service to Honolulu from the Japanese capital and cities including Osaka and Nagoya.

“We welcome the competition because it will expand the overall market for travel to Hawaii,” JAL president Yuji Akasaka said of ANA’s decision to use the A380. “Our strength is that we fly to more than one city in Hawaii, including Kona.”

ANA said adding the plane will help it compete.

JAL shares gained 0.7 per cent as of 2:01pm in Tokyo trading Thursday, while ANA was little changed.

“We are introducing all three of our A380s on the Hawaii route because we want to dominate that in terms of market share,” ANA chief executive Shinya Katanozaka said last week.

After a dozen years in service, Airbus last month decided it will stop making the A380 in 2021, burying a prestige project that faded as airlines grew to prefer smaller, more fuel-efficient aircraft. Fuel-efficient, twin-engine planes that use lighter material such as carbon fibre have undermined demand for the world’s largest passenger airliner, a guzzler powered by four turbines.

By 2021, there will be about 250 A380s flying with 15 airlines, Airbus said. “The A380 will continue to fly, with A380 operators to be supported by Airbus.”

ANA allocated the super-jumbos to the Honolulu route in 2016 with a plan to start flying two of them this year. The A380s will gradually replace the 787s it currently flies to the mid-Pacific islands in a bet that first- and business-class seating on the massive planes can help draw more and higher-paying fliers.

“That kind of customer drops a lot of money at the destination,” Mr Hirako said. Local officials in Hawaii welcome that trend, he added, because they want to boost the islands’ image as a high-end vacation option.

Separately, Germany is in talks with Airbus about €600 million (Dh2.49bn) in outstanding loans advanced for development of the A380, the Berlin government said on Monday.

The loans are at the centre of a longstanding trade dispute about mutual claims of illegal aircraft subsidies between the European Union and the United States, according to Reuters.

A spokeswoman for the German economy ministry confirmed the value of the outstanding loans, first reported by Funke Mediengruppe newspaper chain, but said it was premature to discuss how the issue would be resolved.

"We are analysing the consequences and discussing the issue with the company," she said.

Updated: March 7, 2019 04:49 PM

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