Should Qantas Replace Its Airbus 380s With Boeing 747s?

Should Qantas Replace Its Airbus 380s With Boeing 747s? Qantas, Australia's national airline, has never had a fatal crash since it introduced jet-powered planes in the late 1950s. It's the only major airline that can say that, and that reputation for safety is one it justifiably wants to protect.

But Qantas is in a pickle following its decision to ground its six Airbus A380s Thursday after an engine on one of them exploded as it flew over Indonesia. The Los Angeles Times reported that the plane was "shooting flames and raining large metal chunks before making a safe emergency landing in Singapore with 459 people aboard." Needless to say, it was extremely lucky for all concerned that the engine failure did not have worse consequences.

According to Bloomberg, Airbus is trying to fill the gap in its system caused by the grounding of the A380s by replacing them temporarily with some of its 27 Boeing (BA) 747s. The real question though, is what Qantas should do long term: Should it make that transition to 747s permanent?

A380: Over Budget, Undersold and Way Behind Schedule

The double-decker A380, which debuted in October 2007, is the world's largest airliner, a product Airbus had hoped would seal competitor Boeing's doom. But as I wrote in my book about Boeing, You Can't Order Change, the 555-seat A380 is highly unlikely to make a profit for Airbus because it suffered major delays and ended up costing at least $12 billion instead of the original $5 billion.

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Moreover, demand has turned out to be much smaller than the 1,000 planes Airbus originally anticipated selling. As the Los Angeles Times reports, Airbus has only delivered 37 of them in the last three years -- Emirates Airline (13), Singapore Airlines (11), Qantas (6), Air France (4) and Lufthansa (3). So far, only 243 more A380s are on order, according to The Age.

Should Qantas stop flying those A380s for good and replace them permanently with Boeing 747s. In doing so, it would be getting an older aircraft (the model has been around for 40 years) that's smaller (467 seats for the latest 747-8I model to be rolled out by mid-2011, according to Airline Reporter) but has a comparable range (8,000 nautical miles with 467 passengers compared to 8,000 nautical miles for the A380, according to Aerospace Technology).

Troubling Questions About Rolls-Royce Engines

Unfortunately, the 747 might not actually be a solution to the specific problem at hand. That's because the culprit in the A380 incident appears to be the plane's Rolls-Royce engine -- a Rolls-Royce RB211 Trent 900, which is the most common type fitted to A380s. (According to Aerospace Technology, the A380 is also available with the General Electric (GE)/Pratt & Whitney Engine Alliance GP7200.)

As it turns out, the Boeing 747 also comes with the option of a Rolls-Royce engine. And in October 2010, a Rolls-Royce engine on a Boeing 747 exploded just after takeoff from San Francisco, according to The Age.

Nor was Thursday's incident the only time a Rolls Royce engine has failed recently. According to The New York Times, there have been at least two cases over the last year in which A380s with Trent 900 engines were forced to land after engine failures. On Friday, Qantas passengers suffered a scare when a 747 returned to Singapore after another Rolls-Royce engine burned out. And as I reported in a DailyFinance article in August, a Rolls-Royce Trent 1000 test engine on the Boeing 787 blew up during a ground test.

It appears that Qantas doesn't have any ideal options, but it sure would be nice if the airline could acquire some 747s with engines from a safer manufacturer. Fortunately, the 747-8I comes with the GE GEnx engine, according to Airline Reporter.

Perhaps that's what Qantas will do. The airline wants to maintain its fatality-free record and Boeing could always use more sales. Meanwhile, Airbus must be scrambling to keep the 37 A380s it already has sold in service, and hoping that this latest incident doesn't lead to any order cancellations.

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