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.
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.