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Dubai: Emirates airline's surprise $2.6 billion order last week for an additional eight A380 superjumbo aircraft reflects the airline's big bet on transcontinental traffic and also the large discounts Airbus likely gave, experts say. But by placing such a massive wager on the aircraft, a dip in global aviation could put the airline at risk.
With 55 of the planes on order, Emirates is by far the largest A380 customer. It receives the first of its planes in 2008 after a 22-month production delay.
"The A380 will be a major driver of Emirates business plan," said Robert Ziegler, an aviation analyst at AT Kearney, a management consulting firm.
"They are betting strongly on Dubai's continued role as the major hub in the region connecting the continents and this will require seat capacity."
He added: "Part of the decision is also driven by Airbus' flexibility on price, given the recurring delivery delays of the aircraft."
Ultimately, Emirates may use the new planes to increase their reach in North America, Russia and the former Soviet countries.
"Perhaps we will soon see flights to the US West Coast and holiday destinations in the Caribbean and Latin America," said Diogenis Papiomytis, an aerospace consultant at UK-based Frost & Sullivan.
Papiomytis said Emirates may also be feeling competition from Gulf carriers. "[The purchase] has to do with their ambitious expansion plans and the indirect competition with the likes of Qatar Airways and Etihad, which have also been bold in their orders," he said.
However, he warned that Emirates could suffer if the growth seen in the aviation industry begins to slow.
"The longer term viability of their plans is arguable, as the airline is growing perhaps too fast and may soon face a worldwide recession in air travel at a point in time when the bulk of the orders is planned to be delivered," he said.
The A380 is expected to be phased into Emirates' long distance and high-density routes between large regional hubs or destinations. They will likely replace smaller aircraft on existing routes to North America, Europe, Australia and Asia.
Emirates also plans to order as many as 100 mid-sized Boeing 787 or Airbus A350XWB aircraft. They will be used serve as feeder planes for their main routes, especially as the older A330, A340 and B777 get replaced, Ziegler said.
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