Airbus cuts delivery target and delays jet production goal

Undelivered Airbus wide-bodied jets are seen parked without engines outside the former A380 factory, near Toulouse, as Airbus faces continued supply chain difficulties, France, June 22, 2024, REUTERS/Tim Hepher

PARIS (Reuters) -Airbus on Monday lowered its 2024 total delivery target to around 770 airplanes from around 800 and pushed back a targeted deadline for reaching production of 75 narrow-body airplanes per month to 2027 from 2026.

In a fresh blow to its troubled space activities, Europe's largest aerospace group also announced fresh charges of around 900 million euros after its latest review.

"We are facing headwinds right now; we have to bite the bullet," Airbus CEO Guillaume Faury told analysts.

The downward revision in industrial forecasts comes weeks after Reuters first reported Airbus faced new output delays as it grapples with increased parts shortages.

Industry sources said Airbus concluded it had exhausted its spare margin for deliveries after falling short of its internal target in the first five months, and then starting June at an insufficient delivery rate.

The aerospace industry has been struggling to rehire workers and stabilise supplies after the pandemic left many suppliers with weak finances.

Faury said supplies of engines for its best-selling A320-family of narrow-body jets had deteriorated "significantly" in recent months, one of several factors that prompted the planemaker to cut output forecasts.

The shortfall, he said, affects both engine suppliers for the A320neo narrow-body family, which competes with the Boeing 737 MAX accounts for most of Airbus' cash and profits.

Neither supplier - RTX subsidiary Pratt & Whitney and French-U.S. venture CFM International, co-owned by GE Aerospace and France's Safran - had any immediate comment.

Hinting at a tussle over penalties, Faury said engine suppliers would have to "face the consequences" of any delays.

SPIRIT AERO UNCERTAINTY

Faury also told reporters an uncertain outlook for the industrial commitments of aerostructures maker Spirit Aerosystems had contributed to the downward revision.

He declined to comment on the timing of a widely expected deal to acquire Spirit assets related to the A350 and A220 jet programmes as part of a carve-up of the supplier with Boeing, which sources have said they expect in days or weeks.

Spirit had no immediate comment.

Shortages of seats and cabin parts were also blamed. "We continue to observe a very difficult situation on interiors," Faury told analysts.

Christian Scherer, who took over as head of the planemaking division in January, told German newspaper Hamburger Abendblatt in an interview published on Saturday that engines, landing gear and cabin components were contributing to tight supply chains.

In Canada, workers who produce components for some Airbus and Boeing landing gear at a Safran factory near Montreal have been striking for nearly four weeks.

In Toulouse on Saturday, a Reuters reporter identified five undelivered Airbus wide-bodied jets parked without engines.

Faury said engines for wide-bodied jets from Rolls-Royce are running behind schedule for the A330neo but not the A350. Industry sources said the fitting of some engines has been held back while Airbus awaits seats and other parts.

(Reporting by Tim HepherEditing by Chris Reese and David Gregorio)