Airbus Forges Ahead with Increased Jet Production Amid Profit Surge and Space Program Charge

Airbus is steadfastly proceeding with its plans to escalate jet production across various models next year, a decision underscored by the company’s commitment to meet demand and navigate “challenging” supply chains. This determination comes as the company’s third-quarter profits soared, driven primarily by robust jetliner demand.

In the third quarter, Airbus reported a 21% increase in adjusted operating earnings, reaching 1.013 billion euros ($1.08 billion). This growth, however, was partially offset by a 300-million-euro charge related to undisclosed satellite programs, reportedly including the commercial telecoms family OneSat. Despite this, Airbus has not divulged specifics about the charge, concurrent with the formal announcement of a restructuring in its Defence & Space division that has been in the works for several months.

The company has confidently reaffirmed its financial and delivery forecasts for 2023. In a strategic move to meet the anticipated surge in wide-body jet demand, Airbus plans to augment the production target for its A350 jets to 10 per month by 2026, up from a previous goal of nine by the end of 2025. This announcement comes just ahead of the Dubai Airshow, where wide-body jets are expected to be a focal point.

Air Lease Executive Chairman Steven Udvar-Hazy had earlier speculated that planemakers might fall short of this year’s targets and raised concerns about production issues at Pratt & Whitney. This has sparked a debate over engine supply allocations. However, Airbus CEO Guillaume Faury remains resolute, confirming adherence to the company’s ramp-up plans and dismissing suggestions of easing production pressure in 2024.

Faury emphasized the commitments made by engine suppliers Pratt and CFM, jointly owned by GE Aerospace and Safran, to fulfill agreed quantities. He cautioned against premature assumptions about Airbus’ production based on supplier comments, noting Pratt’s reconfirmed commitments despite their widespread challenges.

Regarding production levels, industry sources indicate that Airbus is currently producing A320-family jets at a rate slightly lower than planned but maintains potential for future catch-up. The A220 program, though facing temporary supplier slowdowns, continues with plans to increase output. Airbus, while not commenting on specific production figures, remains on track to deliver the extended-range A321XLR in the next year’s second quarter, progressing steadily towards certification.

The company also braces for negotiations with Spirit AeroSystems, following the latter’s recent price increase agreement with Boeing. Faury expects a mutually supportive relationship, given Spirit’s significant role as a supplier for Airbus.

Airbus is navigating the complexities of supply chain challenges and internal restructuring with a clear focus on ramping up production to meet the growing demand for its jetliners. The company’s strategic decisions and steadfast commitment to its production goals signal a robust outlook for its operations in the coming years.

Sources: AirGuide Business airguide.info, bing.com, airbus.com, reuters.com