Airbus forced to write off almost a billion dollars
Even though the problems that Boeing has been driving its customers to Airbus, Airbus yesterday revealed that its own business outlook is presently suffering, forcing it to write off $965 million.
Yielding to growing scepticism among suppliers over its plans for jet output, Airbus lowered its widely watched forecast for deliveries this year to around 770 jets from around 800. It also tempered plans to raise output of its best-selling A320neo family, by delaying the date at which it expects to reach a record production speed of 75 jets a month to 2027 from 2026. That compares with an estimated 50 jets a month now.
As a result of the lower delivery forecasts, which imply annual growth of 5% instead of 9%, Airbus lowered its main financial targets for 2024. It now expects underlying operating income of around 5.5 billion euros, instead of a range of 6.5 billion to 7.0 billion, and free cashflow of 3.5 billion instead of 4.0 billion.
The article focuses on Airbus’s engine supply issues that are restricting its ability to build jets. It makes no mention of the company’s joint partnership with Safran to build the Ariane-6 rocket, which has failed to garner the business predicted, even as it is about to make its inaugural launch on July 9th. Though peripheral to the airplane issues described, it is certainly a factor in these financial issues.
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Even though the problems that Boeing has been driving its customers to Airbus, Airbus yesterday revealed that its own business outlook is presently suffering, forcing it to write off $965 million.
Yielding to growing scepticism among suppliers over its plans for jet output, Airbus lowered its widely watched forecast for deliveries this year to around 770 jets from around 800. It also tempered plans to raise output of its best-selling A320neo family, by delaying the date at which it expects to reach a record production speed of 75 jets a month to 2027 from 2026. That compares with an estimated 50 jets a month now.
As a result of the lower delivery forecasts, which imply annual growth of 5% instead of 9%, Airbus lowered its main financial targets for 2024. It now expects underlying operating income of around 5.5 billion euros, instead of a range of 6.5 billion to 7.0 billion, and free cashflow of 3.5 billion instead of 4.0 billion.
The article focuses on Airbus’s engine supply issues that are restricting its ability to build jets. It makes no mention of the company’s joint partnership with Safran to build the Ariane-6 rocket, which has failed to garner the business predicted, even as it is about to make its inaugural launch on July 9th. Though peripheral to the airplane issues described, it is certainly a factor in these financial issues.
The support of my readers through the years has given me the freedom and ability to analyze objectively the ongoing renaissance in space, as well as the cultural changes -- for good or ill -- that are happening across America. Four years ago, just before the 2020 election I wrote that Joe Biden's mental health was suspect. Only in this year has the propaganda mainstream media decided to recognize that basic fact.
Fourteen years ago I wrote that SLS and Orion were a bad ideas, a waste of money, would be years behind schedule, and better replaced by commercial private enterprise. Even today NASA and Congress refuses to recognize this reality.
In 2020 when the world panicked over COVID I wrote that the panic was unnecessary, that the virus was apparently simply a variation of the flu, that masks were not simply pointless but if worn incorrectly were a health threat, that the lockdowns were a disaster and did nothing to stop the spread of COVID. Only in the past year have some of our so-called experts in the health field have begun to recognize these facts.
Your help allows me to do this kind of intelligent analysis. I take no advertising or sponsors, so my reporting isn't influenced by donations by established space or drug companies. Instead, I rely entirely on donations and subscriptions from my readers, which gives me the freedom to write what I think, unencumbered by outside influences.
Please consider supporting my work here at Behind the Black.
You can support me either by giving a one-time contribution or a regular subscription. There are five ways of doing so:
1. Zelle: This is the only internet method that charges no fees. All you have to do is use the Zelle link at your internet bank and give my name and email address (zimmerman at nasw dot org). What you donate is what I get.
2. Patreon: Go to my website there and pick one of five monthly subscription amounts, or by making a one-time donation.
3. A Paypal Donation:
5. Donate by check, payable to Robert Zimmerman and mailed to
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Cortaro, AZ 85652
You can also support me by buying one of my books, as noted in the boxes interspersed throughout the webpage or shown in the menu above. And if you buy the books through the ebookit links, I get a larger cut and I get it sooner.
The 900 million Euro write-off is not related to either jet airliner production or the Ariane 6. It’s reportedly entirely due to the telecom / navigation satellite unit. That unit also had a 600 million Euro write-off at the end of last year.
Airbus has won *a lot* of telecom satellite orders the last six or so years at the expense of Boeing and Space Systems Loral. It now appears that they did so by selling those satellites at a loss.