Business & Investment

Despite supply disruptions by Reuters, Airbus sticks to jet delivery targets

© Reuters. File photo: On July 2, 2020, the Airbus logo is displayed at the entrance of the factory in Brañac, near Toulouse, France.Reuters / Benowatecie

Tim Heffer

Paris (Reuters)-Airbus to maintain widespread forecasts for 600 jet deliveries this year, despite signs of labor shortages as the economy exits COVID-19 “hibernation” Overcame new obstacles in the global supply chain.

The world’s largest aircraft manufacturer raises its full-year profit and cash targets after profits exceeded expectations in the third quarter and refuses to succumb to industry critics who question the bullish forecasts of jet production bottom.

After a series of supply chain warnings, ignoring the global stock recession, Airbus shares rose about 3% and then 1%.

Guillaume Foley, CEO, said pre-crisis output 15 months after the European group continued to brake to avoid adding excess aircraft during the worst crisis in the aviation industry. He said recovery to the level is in progress.

“We are observing labor shortages around the world affecting all sectors,” Foley told reporters.

“We are now up and witnessing all the difficulties of getting out of some hibernation and returning to business in a world where many products and sectors are up again.”

Airbus said it faced some problems in receiving parts on time, leading to jet rework and contributing to the flattening of recent deliveries, but what seemed systematically Said not.

“I think we can manage these in the last few months of this year,” Foley said.

Analysts said Boeing (NYSE :)’s decision to maintain delivery provided a boost, especially after years of turmoil in aerospace facing industrial problems.

“In essence, we’re back in’delivery, profit, and repeat’,” said Sash Tsusa, an analyst at Agency Partners.

Airbus reported that operating profit fell 19% to € 666 million ($ 772.7 million) in the third quarter and revenue fell 6% to € 10,518 million. Full-year operating profit of € 4.5 billion and free cash flow of € 2.5 billion are above the previous targets of € 4 billion and € 2 billion, respectively.

Analysts expected an average operating profit of € 623 million, based on a consensus compiled by the company.

Commitment to output the view

By the summer of 2023, Airbus raised its production target for the major A320 family to 65 a month, leaving room for timetable shifts. In May, it plans to have a fixed rate of 64 per month by the second quarter of 2023.

Airbus claimed that it remained in the same overall orbit. Demand for air travel is recovering, especially in the busy A320 category, where Boeing 737s compete.

However, it remains involved in controversy with suppliers and leasing companies over its ambition to raise it to 75 per month by 2025.

Engine makers and lenders have protested that the proposal risks overheating the market and damaging their own business, which relies heavily on the life of old planes.

Some in the industry have personally accused Airbus of dumping jets to steal market share from troubled Boeing-Airbus says its output decisions are fully backed by demand. I’m denying it.

Boeing has lower tariff caps to recover from overlapping safety crises, but CEO Dave Calhoun warns of a “supply-constrained world” from late 2022 to 2023 on Wednesday. It was implicitly weighted when it was done.

“We know there are many views on this, but we also have our own views, and we have our own views that demand supports rate 75, but supplies,” said Foley of Airbus. We need to consider the status of the chain. “

He didn’t say if Airbus was still aiming to reach that level by 2025, but later told analysts: ..

The clash between leasing companies and suppliers and Airbus reflects the contrasting benefits that the crisis has pushed to the boiling point, sources said. Airplane makers make money from new sales rather than relying on old jets to repair or generate rents.

Lenders intervene when the times are tough and they are afraid that overproduction will devaluate jets. Some critics blame it for future production quotas, even if they say there is no demand.

In a large jet program, Airbus announced that it would increase its depressed A330’s output from twice a month to nearly three by the end of 2022. It repeated increasing production of the flagship A350 from 5 to 6 a month, but postponed this from the fall of 2022 to the beginning of 2023.

Despite supply disruptions by Reuters, Airbus sticks to jet delivery targets Despite supply disruptions by Reuters, Airbus sticks to jet delivery targets

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