Airbus has stuck by its target to deliver 700 aircraft by the end of this year and raised its outlook for free cash flow but warned that supply chains remained fragile because of raw material and labour shortages.
The European aircraft maker said on Friday it was still working towards a monthly production rate of 75 for its A320 family of single-aisle jets by 2025. The company is also assessing higher production rates for its large widebody aircraft to meet growing demand as international air travel recovers from the huge hit taken during the pandemic.
Guillaume Faury, Airbus chief executive, said global supply chains remained “very degraded” and the company was still experiencing “problems a bit all around the place”. It would take “at least to the middle of next year and probably now a bit more” for the aerospace supply chain to recover significantly, he added.
Airbus, like other manufacturers including US rival Boeing, has struggled with shortages of raw materials, electronic components and labour. Faury’s comments echoed those of David Calhoun, Boeing’s chief executive, who this week said he expected the supply chain to remain “challenged over the course of 2023”.
Unlike Boeing, however, which said deliveries of engines were its main constraint, Faury said engine makers were now meeting their commitments.
Airbus delivered 437 aircraft in the nine months ending September 30 — leaving another 263 to come by the end of the year if the company is to meet its target of 700 planes.
It is delaying the introduction of its extra-long range A321XLR to the second quarter of 2024, from early 2024.
On the defence side, Faury reiterated his support for Europe’s next-generation fighter programme, the Future Combat Air System, which has been dogged by disagreements between Airbus and its partner Dassault over who would lead critical parts.
The project, said Faury, was “very important” for Europe, noting that these large and complex systems have to be developed “in co-operation”.
Airbus, he added, was still working “towards an agreement”, which he hoped would be secured before the end of this year.
Faury’s comments came as the company reported third-quarter adjusted earnings before interest and tax of €836mn, up from €666mn a year earlier. Revenues rose 27 per cent to €13.3bn.
Airbus maintained its target to achieve €5.5bn in adjusted earnings before interest and tax for the year. It raised its outlook for free cash flow to €4.5bn from previous guidance of €3.5bn, driven by the strong dollar.
Its shares were largely flat in early morning trading at €106.