The history of the Airbus A330neo has been full of twists and turns.
For many years, the aircraft has been Airbus’ answer to Boeing’s launch of the 787. The requirement to make the aircraft more capable over time in terms of payload and range has led to a massive increase in maximum take-off weight (MTOW) to the current upper limit of 251 tons and in range to 8,150 nm for the A330-800 and 7,200 nm for the larger -900. Airbus turned the original A330-200/300—once more of a medium-range high-capacity aircraft somewhat like the A300/310—into a true long-haul jet.
But the latest performance changes, now approved by the European Union Aviation Safety Agency (EASA), indicate a change in direction. EASA has certified versions of the A330-800 and -900 that are significantly lower weight than the in-service A330neo fleet. MTOW of the -800 and -900 so far varied between 230 and 251 tons, depending on the version the airlines wanted. Now, additional versions of the -800 are being offered which are as light as 200, 205, 210, 215 and 220 tons, while the -900 is now also available at 205, 210, 215 and 220 tons.
Because of a variety of factors, notably lower airport fees, the changes can lead to a significant reduction in operating costs and are making the aircraft more attractive to operators that don’t need the long-range capabilities.
There are likely two main reasons why Airbus is broadening the A330neo offering. First of all, the aircraft isn’t selling well—and this was also the case before the pandemic when airlines were still in buying mood. Condor’s recent order for 16 does not change the picture that much as less than half of the aircraft are adding to the backlog—most come from lessors. And Condor is a niche operator with specific requirements that don’t necessarily reflect those of the big legacy airlines Airbus had hoped to attract with the A330neo.
The backlog is a mere 11 aircraft for the A330-800 and 257 for the -900. But the -900 order book looks better than it is: it includes 76 aircraft from AirAsia X, an airline that has been grounded since the start of the pandemic and has also indicated it no longer wants a large A330neo fleet. Airbus also still lists 28 aircraft for Iran Air and 42 for undisclosed customers, 38 of which are believed to be allocated for HNA Group, the distressed Chinese conglomerate that owns several airlines. Almost 150 aircraft in the backlog must therefore be considered in doubt.
Unlike the original A330, the A330neo has not really taken off in Asia. The reason may well be that the A330neo is more capable— andthus heavier and more expensive than most Asia-Pacific airlines need for their medium-haul services. For long-haul, there is still the A350 or the Boeing 787 and 777. The lower-weight versions might address that issue.
The other component for the decision is competitive dynamics. Airbus has driven A330neo performance about as far as it could and if airlines want even more there is always the A350. Boeing’s only new widebody project is the 777X, which is beyond the A330neo’s capabilities anyway. But with Boeing still pondering how to fill the gap between the 787 and the 737 MAX, Airbus has an incentive to make that decision as hard as possible for its competitor. The strategy has always been based on two pillars: attacking whatever Boeing offers from the top using the A330neo and from the bottom with the A321neo—the XLR version in particular. The two aircraft pretty much cover the space for the time being, meaning Airbus can afford to wait for and react to any Boeing initiative before making any massive moves itself. Until then, lower take-off weight A330neos are one easy way to handle the situation.
Airbus has always bet on the flexibility of the A330 and A330neo but it has also had to correct some strategic mistakes over time. When Boeing launched the 787, Airbus initially pitched an aircraft to airlines that looked quite similar to today’s A330neo. Airlines and lessors, particularly Steve Udvar-Hazy, rejected the idea. The market response forced Airbus to launch an expensive development program for an all-new aircraft, the A350, which has become a success both in terms of performance and customer acceptance. It is now also offered as a freighter. The A330neo came in behind the A350 finally, and ironically Hazy’s Air Lease Corporation (ALC) is now one of its biggest customers.
Because of the extremely low demand for widebodies in general, Airbus has been forced to reduce output to around two aircraft a month with no prospect of the situation improving in the immediate future. But the company has been clear that it has no plans whatsoever to terminate the program despite the current difficulties. It still sees strategic value in the A330neo.
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