In a hit-piece entitled Airbus’s Lesson for Young Socialists, a Wall Street Journal column heaps scorn on the Airbus A380 program.
The column is by Holman W. Jenkins Jr, a long-time columnist and editorial writer for the Journal. He starts by praising the resiliency of the Boeing 747 and 737 programs, noting that both aircraft are still being produced over 50 years later.
These programs are contrasted with the short-lived A380 program, which Jenkins blames on socialism:
Socialism is currently in vogue. If the word means anything in today’s context, it means projects of unusual government ambition, built on our globally shared capitalist technological and commercial base. The A380 was exactly such a project. Underwritten by massive European government subsidies, the plane was an engineering sensation. Passengers loved the roomy jet. Yet now it’s kaput. What went wrong? Or to phrase the question more usefully, what technological and commercial realities would its sponsors have had to overrule to assure its success?
He then argues that Airbus missed obvious consumer desires for direct flights and more frequencies sustainable with smaller aircraft in order to pursue a vain dream to outdo the 747.
His conclusion is that “socialism” may build airplanes, but it cannot sell them:
This should guide us in our thinking about what kind of “socialism” is possible today. Governments can tax their own people until they rebel at the ballot box, refuse to pay, or emigrate. They have no power, in our world, to dictate what kinds of goods and services and technologies (green or otherwise) the global marketplace will accept.
When the end came, it came because the A380’s last dedicated customer, the government-backed Emirates Airline of Dubai, gave up on the superjumbo. Planes in pristine condition were lingering unsold on the used-plane market. A 10-year-old jet was recently retired by Singapore Airlines . Now it’s being broken up for scrap, proving once again socialism’s knack for making grown men cry.
Finally, he links the Airbus A380 program to California’s bullet train project–facing massive cost overruns–to again reiterate his thesis that socialism doesn’t work.
I have subscribed the Wall Street Journal for 15 years and unabashedly call it a newspaper I look forward to reading each day. I’m also not keen on government subsidies, like the kinds Delta receives to operate essential air service, from Canada for its Bombardier program, from the State of Georgia, and when it unloaded employee pensions onto the federal Pension Benefit Guaranty Corporation.
But I think Jenkins is far too quick to play into his own zeitgeist biases when it comes to the A380 program. In fact, over in the news section of the same February 19th edition, another article appears entitled, How Airbus’s A380 Went From Wonder to Blunder.
Sure, there were cost overruns, serious production problems, and pride issued involved, but the biggest problem of the A380 program was that Airbus made a calculated risk of market conditions that turned out to be wrong.
As the article points out,
All jetliners are expensive bets on technology, engineering and market trends. When Boeing’s 747 first flew in 1969, it was triple the size of any other plane in the air and for several years its success was uncertain.
Boeing took a huge bet on the 747 program…and won. It proved to be a remarkably successful program. Airbus figured that it could create a larger, more comfortable aircraft that could more efficiently shuttle passengers from hub to hub. It was a commercial decision that could have turned out splendidly.
Instead, though, the Boeing 787 and Airbus A350 programs were what airlines really wanted. And we see that within Airbus the A350 and later A330neo programs were key competitors to its A380 program.
Not every commercial risk is going to be pay off, but with great risk comes the potential of great reward.
The A380 was hardly the only aircraft to experience cost overruns, delays, and disappointments. I just cannot be as hard as Jenkins is on Airbus. Were there seriously blunders? Absolutely. But let’s give Airbus credit for creating an amazing aircraft and at least trying something new and different that may well have taken off under different conditions beyond the control of Airbus or Boeing.