Safran agrees deal with Airbus on 2024 engine output

France's Safran said on Friday it had reached an agreement with Airbus on jet engine supplies for 2024, in a sign the European planemaker is nearing a decision to raise its narrowbody A320-family output targets.

Chief Executive Olivier Andries declined to give a figure for the number of engines it had agreed to build together with CFM International partner General Electric, but told reporters it was equivalent to levels in mind before the crisis.

It is too early to talk about 2025, he added.

Airbus declined comment on the agreement, which follows a year-long standoff with engine makers that have been worried about planemakers raising jet production too quickly.

Airbus Chief Executive Guillaume Faury on Thursday reaffirmed plans to raise A320-family output to 65 a month by summer 2023.

Airbus has said it aims to take a decision by mid-year on whether to press ahead with plans to raise monthly output to 70 in the first quarter of 2024 and as high as 75 by 2025.

The world's largest planemaker is producing around 50 a month and plans an interim step of 61 a month by end-2022, according to a recent filing in a court case with Qatar Airways.

Until now, engine makers CFM and to a lesser extent Pratt & Whitney have voiced concerns about committing to monthly airplane production levels beyond the 65 planned for mid-2023.

They fear their main business of servicing planes already in the fleet would be damaged if new planes pour into a bruised post-pandemic market too quickly, pushing out older planes with plenty of years of repair revenues ahead of them.

Safran said earlier that North America and Europe were recovering, offset by a sudden new slowdown in China.

"We have an agreement with Airbus for quantities in 2024," Andries told reporters in a quarterly briefing.

He would not discuss specifics except to say the new target differs from 2023, effectively ruling out a flattening of production of the A320neo which competes with Boeing's 737 MAX.

"It corresponds to the quantity that we had committed to before the crisis and given (this), we were naturally able to reach agreement on a quantity to supply in 2024," he said.

Source: Reuters

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