Daily Management Review

Airbus: production problems impede achieving targets


Airbus, a European aircraft manufacturing corporation, will rely on the aircraft it acquired in July to maintain supplies and fulfill its promise to produce 800 aircraft in 2018, reports Bloomberg.

The company still expects to achieve the goal set at the beginning of the year, but only taking into account the 18 A220 aircraft - the model that it acquired from Bombardier Inc. In earlier forecasts, Airbus did not take into account these items.

The change, which was announced along with the results for the third quarter, underlines the production difficulties that Airbus faced during the year, starting with the shutdown of the production of the narrow-body A320neo aircraft due to engine problems.

Airbus also confirmed that delays in the supply of engines from Rolls-Royce Holdings Plc will lead to a decrease in the supply of the A330neo wide-body aircraft.

The British company said in a letter to the employees that by the end of October only 10 Rolls-Royce Trent 7000 engines would be delivered. The production volume was "much less" than the 30 engines promised by Airbus, so it will be able to transfer only 15 wide-body aircraft to airlines by the end of the year.

It is expected that the first commercial flight of the A330neo will take place in the coming weeks, about a year later than the originally scheduled date.

Earlier interruptions, as well as "some internal production problems" make it difficult to achieve the goal for the whole of 2018, Airbus said. "Much remains to be done before the end of the year to fulfill the obligations," the company said.

Airbus adjusted operating profit more than doubled in Q3, as an increase in the supply of A350 wide-body aircraft provided an inflow of cash. The cost of the program decreases as production accelerates.

source: bloomberg.com