Airbus Reinforces Jet Production Plans Amid Supply Chain Challenges

Airbus has reiterated its plans to increase jet output in 2022, despite the challenges faced by its supply chain. The increased demand for jetliners led to its third-quarter profit rising by a significant amount. The company reported a 21% increase in adjusted operating earnings, which would have been higher if not for a 300 million euro charge on unidentified satellite programs.


Airbus did not provide any further information on the charge, but it announced a restructuring of its Defense & Space division. Airbus reaffirmed its 2023 financial and delivery forecasts, and it plans to raise the target for jet production to 10 a month in 2026. The previous goal was nine by the end of 2025, which is expected to resurface at next week's Dubai Airshow. Steven Udvar-Hazy, the Executive Chairman of Air Lease, predicted that planemakers would miss their targets this year and voiced concerns about engine supplies. 

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However, Airbus CEO Guillaume Faury confirmed that they will deliver according to their ramp-up plans. Faury also stated that both Pratt and competing engine supplier CFM, owned by GE Aerospace and Safran, had pledged to stick to agreed quantities. He cautioned against making too many assumptions about Airbus' production based on supplier remarks. Referring to Pratt, Faury said, "They have commitments that they have reconfirmed to us several times that they intend to stick to.

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"There is little margin for error for Airbus as it is already below planned levels of production for small and medium jets, though there is scope to catch up later. Airbus is producing A320-family jets in the low-50s per month instead of the planned level closer to 58. On the loss-making A220, Airbus reiterated its plans to raise output to 14 a month. But it has been forced to ask some suppliers to slow down as it builds little more than five a month, compared with a schedule closer to nine. Airbus declined to comment on granular production figures. However, it reiterated plans to deliver its extended-range A321 in the second quarter of next year. The company said it was progressing well towards certification following scrutiny of a fuel tank design. Airbus is also preparing for negotiations with Spirit AeroSystems after the aerostructures maker secured a price hike from Boeing. Faury said, "We are working very closely with them in the spirit of supporting them, but we also expect Spirit to well support Airbus." Spirit said it had nothing to add to comments by new CEO Patrick Shanahan who said last week, that a similar price deal with Airbus was "an item of utmost urgency" and should address cost pressures on the A220, for which Spirit builds wings.

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