However, when the 747 was launched in 1966, the overall airliner market, as measured by the size
of the active fleet, was much smaller than in 2001, when the first orders for the A380 were made:

The following chart puts this in perspective, and also shows that these very large aircraft typically
represented only a small proportion of overall net orders during the first nine years each was on offer:

In this context, having a customer acquire 90 of a type that cannot be described as selling robustly clearly
is a blessing -- or is it?  Emirates' orders for the A380 constitute, to date, 38% of the order book for the type.
If history is any guide, this does not augur well for the type's long-term success.

There have been a number of cases where a small number of customers (or even one) accounted for the
bulk of the business for a particular airliner type.  Typically, this results from either designing an aircraft for
a particular carrier'(s) requirements, or designing a product for a market segment where there turns out to
be little effective demand.   Examples include the Dassault Mercure; all of the production, 10 aircraft, went
to Air Inter, the French domestic carrier.  The Vickers Vanguard only had two customers:  the UK's BEA
and Trans Canada.  Only 43 were produced.

Several of the early jet types had order books dominated by a single customer.  BEA acquired 64 de
Havilland/Hawker-Siddely Tridents, 55 percent of the 117 built.  Also in the UK, BOAC took delivery of 29 of
the 39 VC-10s built as airliners (74 percent); an additional 14 militarized versions were taken by the RAF.  
On the other side of the Atlantic, TWA took delivery of 27 of the Convair 880s built (42 percent), while
American took delivery of 20 of the 36 Convair 990s produced (56 percent), indicating that geography was
not the sole factor in commercial aircraft programs dominated by a single customer.

A number of types manufactured outside the U.S., which dominated the world market prior to the advent of
Airbus, had relatively broad customer bases, and larger production runs.  The Viscount, which handily
outsold its successor, the Vanguard, achieved a production total of 443.  The Caravelle, Europe's
best-selling jet airliner prior to Airbus, sold 290, with significant diversity in the order book, including United.
Interestingly, the BAC One-Eleven, the UK's best-selling jetliner, had only 18 deliveries to BEA.  This figure
was handily eclipsed by the 30 for  American Airlines; two other U.S. carriers, Braniff and Mohawk, took 14
and 18, respectively.

While it could be argued that conditions in the industry were different during the era when these aircraft were
launched, the jet types cited entered service within a few years of the launch of the 747 program in 1966
(Caravelle 1959; Convair 880 1960; Convair 990 1962; VC-10 1964; Trident 1964; One-Eleven 1965);
indeed, the Mercure's service entry in 1974 post-dated the 747's first service by four years.

In some cases, the design requirements of the principal customer were adhered to so specifically that the
aircraft ended up having little appeal to other potential customers, an example being the VC-10.  Again,
American manufacturers were not immune; Airlife's Commercial Aircraft and Airliners (1999) states that "In
reality, the Convair 880 was too rigidly tailored to the needs of TWA..." (page 156). 

While it is not likely that this is directly the case for the A380/Emirates situation, the combination of significant
customer concentration, slow sales progress and overall low penetration of the market  to date (almost a
decade into the program) suggest strongly that long-term success for the type likely will be elusive.  History
certainly does not always repeat itself, but a modest look back often can provide strong clues about the
future. 

Finally, it is useful to point out that this phenomenon is not new.  Furthermore, the example involves a
prominent name (Boeing) although time-wise, it's necessary to go back to the 1930s.   United Airlines ordered
59 Boeing 247s in 1932, a type that has been referred to as "the first modern airliner".    Ultimately, only 75
Boeing 247s were produced, at least in part because when another airline, TWA, also wanted to order the
type, they were told that they would have to wait until the United order was fulfilled.  Not being that patient,
TWA turned to Douglas Aircraft, which led to the DC-1, and, as they say, the rest is history.  And it's possible
that those who don't remember history may be doomed to repeat it...airliners that have relied on a small
number of dominant customers have generally not been successful programs.

-end-

George W. Hamlin, President of Hamlin Transportation Consulting and previously Managing Director at ACA Associates, has more than 35 years of experience in the commercial aviation and aerospace industries. His previous experience includes senior consulting positions at Global Aviation Associates (now InterVistas-ga2), MergeGlobal and Morten Beyer & Agnew. His advisory expertise includes specialization in transport economics, marketing and strategic planning, aircraft requirements/fleet planning, economic analysis and forecasting for both passenger and cargo operations.
 
Prior to Global Aviation Associates, Mr. Hamlin was Director of Strategic Planning at Airbus Industrie of North America, Manager of New Business Development at Lockheed Aeronautical Systems Company, and Director of Schedule Planning at Texas International Airlines. Mr. Hamlin began his career in commercial aviation as a Financial Analyst with Trans World Airlines, in New York, NY, and later was responsible for the scheduling of the carrier’s freighter operations, after serving initially as a part-time Customer Service Agent at JFK Airport.

To contact Mr. Hamlin, visit www.georgehamlin.com or email contactgeorge@georgehamlin.com

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