FILE PHOTO: The logo of Airbus is pictured at the entrance of the Airbus facility in Bouguenais, near Nantes, France, July 2, 2020. REUTERS/Stephane Mahe/File Photo
Airbus SE is pushing ahead with ambitious plans to ramp up production of its bestselling A320-family of jets to 75 a month by 2025.
The figure represents a jump from a build rate of about 50 of the narrow-body planes per month right now and the 65 targeted for the middle of 2023, and comes as demand recovers from the coronavirus crisis, the European planemaker said in a statement Wednesday.
Airbus also reiterated a goal of 720 jetliner deliveries this year, even as the war in Ukraine and new Covid lockdowns in China make building and operating aircraft more challenging. It reported first-quarter earnings that beat analyst estimates and backed prior financial targets for 2022.
"Our 2022 guidance is unchanged, even though the risk profile for the rest of the year has become more challenging due to the complex geopolitical and economic environment,” Chief Executive Office Guillaume Faury said in the release. "Looking beyond 2022, we see continuing strong growth in commercial aircraft demand driven by the A320 family.”
Suppliers and leasing firms had previously pushed back against the pace of the planned construction ramp-up, before Airbus secured an 18-month extension to key engine-supply contracts last week. The hike should help the firm consolidate its advantage over Boeing Co. in a single-aisle jet market that dominates sales, reducing production backlogs and freeing up delivery slots.
The Toulouse, France-based manufacturer’s adjusted earnings before interest and tax increased to 1.26 billion euros ($1.3 billion) in the first three months, from 694 million euros a year earlier. Results were helped by a one-time gain of 400 million euros from a remeasuring of pension obligations.
Airbus also reiterated a free cash flow target of 3.5 billion euros for 2022 before customer financing and spending on acquisitions, about the same last year, and an increase in adjusted Ebit to 5.5 billion euros.
Less positive for the company are issues complicating the introduction of its new A321 XLR extra long range jet, which it said will slip into 2024 amid certification delays.
Bloomberg reported Tuesday that the model is under scrutiny from regulators amid concerns about increased fire risk from an extra fuel tank, with safety improvements likely to add weight and slightly curb its range.
