a380 bragging rights might not be worth it

Posted on March 27, 2008

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You would think that a company as financially-savvy as Singapore Airlines would have thought long and hard before making the decision to be the first airline to fly the super-sized jumbo jet, the Airbus 380. In retrospect, it seemed to be a decision driven by vanity over other factors.

The aircraft, which seats 470 under SIA’s configuration, might have given SIA the bragging rights to be the world’s first carrier to operate the plane. But it has also been providing the world’s most profitable airline a lot of unwanted publicity recently.

Just on Tuesday, SIA was forced to make the embarrassing announcement of grounding its A380 from making its Singapore to Sydney flight, and scrambling to place the stranded passengers on other planes to Sydney. Passengers were reportedly left high and dry for six hours before they could get alternative flights.

The fanfare and media coverage SIA received from being the only airline operating three A380s from Singapore to Sydney, London, and soon, Tokyo, very quickly turned into damage control operations, as the A380s have already generated four well-publicized failures in the few short months it had been in service since October.

The most recent incident was attributed to a pump failure. It suffered other mechanical issues, such as rolling off the tarmac in January, a fuel pump defect in February and an issue with its brakes in early March.

SIA is putting a brave face on these glitches, saying that the aircraft’s reliability had been “generally excellent”. “Its entry-into-service record has been substantially better than any other new aircraft type that we’ve received. While there will be teething issues, we will treat them carefully and cautiously – and won’t be rushing to put a plane into the air which isn’t 100 per cent good to go,” an SIA spokesman told the media.

It had better work out these teething problems and get a grip on them quickly.

SIA’s selling point and its differentiation with a lot of other airlines is its well-deserved reputation not only for first-class service and a young and well-maintained fleet of planes, but importantly, its reliable punctuality. These attributes keep it ahead of the competition, enabling it to charge a premium that many other airlines cannot. If SIA keeps having to issue press statements about one mechanical failure or another of its A380, those are not the kind of publicity that would be helpful to its reputation nor its bottom line.

The A380 flights had reportedly been attracting brisk business due to the novelty factor. But this series of negative public relations is bound to hold potential passengers back from jumping on the A380 bandwagon. No one likes facing flight delays, especially not if they had to pay a premium to get a seat on the A380. What a nightmare it would be to have to reschedule meetings or other arrangements due to the delays.

The delays could also be costly to SIA. Not only do they have to find capacity in a hurry to take care of grounded customers while the plane is being worked on, they would also have to compensate them, if not monetarily, at least for goodwill, in the form of vouchers or other gifts. Let’s hope they have set aside a sizable budget to deal with contingencies like these.

SIA has ordered another 16 A380s, with an option for more. Looking at SIA’s experience with its A380s, other airlines must be glad they did not plunge first into getting the bragging rights of operating the largest jumbo jet ever.

Perhaps the A380s’ mechanical problems are not surprising, given the two-year delay in the delivery by Airbus of the A380 due to various wiring setbacks. The first generation release of any new product has always been and will always be problematic. All this should have been harbingers for SIA. It might now have learned its lesson and be reminded to be more circumspect before rushing to buy new untested planes and putting them into operation.

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