COVID-19: Airbus cuts production by one-third

Says business impacted by COVID-19 pandemic; 21 net orders and 36 deliveries in March 2020; 290 net orders and 122 deliveries in Q1 2020; Production rates revised downwards adapting to new market environment.

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European plane maker Airbus said it was cutting production of some of its previously best-selling aircraft as the COVID-19 coronavirus pandemic brings passenger air traffic to a virtual halt. The production cuts had been reported as possible a week ago by various media outlets and Airbus made it office on Wednesday (8 April), when it announced the new production rates.

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An Airbus A320. (PHOTO: Airbus)

The company said its new production rates would be:

  • A320s at 40 per month
  • A330s at 2 per month
  • A350s at 6 per month
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The Airbus final assembly line in Tianjin, China. (PHOTO: Airbus)

The cuts will likely lead to additional job losses rippling through the global aviation supply chain as manufacturers like Boeing and many others have either paused production entirely or suspended production of certain types of aircraft.

Airbus said the cuts represent “a reduction of the pre-coronavirus average rates of roughly one-third” and allows the company to preserve “its ability to meet customer demand while protecting its ability to further adapt as the global market evolves”.

“The impact of this pandemic is unprecedented. At Airbus, protecting our people and supporting the fight against the virus are our chief priorities at this time. We are in constant dialogue with our customers and supply chain partners as we are all going through these difficult times together,” said Airbus Chief Executive Officer Guillaume Faury. “Our airline customers are heavily impacted by the COVID-19 crisis. We are actively adapting our production to their new situation and working on operational and financial mitigation measures to face reality.”

Airbus said in the first quarter it booked 290 net commercial aircraft orders and delivered 122 aircraft. A further 60 aircraft were produced during the quarter, but remain undelivered due to the COVID-19 pandemic. Thirty-six aircraft were delivered in March across the different aircraft families, down from 55 in February 2020. This reflects customer requests to defer deliveries, as well as other factors related to the ongoing COVID-19 pandemic, they said.

Airbus said it is working “in coordination with its social partners to define the most appropriate social measures to adapt to this new and evolving situation. Airbus is also addressing a short-term cash containment plan as well as its longer-term cost structure”. This means that Airbus, like Boeing, is working to shore up its balance sheet and prepare for a future world in which orders will be slim as most of the world’s passenger fleet remains grounded and demand for new planes in the near term will be not be anywhere near that of the recent past.

Boeing announced previously that it was suspending production at all of its Puget Sound facilities in the US state of Washington and was also pausing production of the 787 Dreamliner at its plant in the US state of South Carolina.

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