PARIS, Nov 8 (Reuters) – Airbus (AIR.PA) doubled down on plans to raise jet output across the board next year, with its top executive reminding engine makers of their commitments in the face of “challenging” supply chains, as jetliner demand led its third-quarter profit higher.
Airbus said adjusted operating earnings rose 21% to 1.013 billion euros ($1.08 billion) and would have been higher but for a 300 million-euro charge on unidentified satellite programmes, said by sources to include commercial telecoms family OneSat.
Airbus declined to elaborate on the charge, which came as the planemaker formally announced a restructuring in its Defence & Space division that has been in preparation for several months.
It reaffirmed 2023 financial and delivery forecasts and said it would raise the target for A350 jet production to 10 a month in 2026 from a previous goal of nine by end-2025 amid demand for wide-body jets, expected to resurface at next week’s Dubai Airshow.
The comments came after Air Lease AL.N Executive Chairman Steven Udvar-Hazy predicted planemakers would miss targets this year and voiced concern about production flaws at Pratt & Whitney, which have led to a tug of war over engine supplies.
Airbus CEO Guillaume Faury stuck to his guns, however.
“I confirm that we will deliver according to our ramp-up plans,” he said after presenting Wednesday’s results.
For 2024, Faury gave no sign that Airbus was willing to relax the effort, despite pressure to divert engines from aircraft factories to ease shortages in overloaded repair shops.
“2024 is again about ramp-up,” he told analysts. Some analysts have said the coming year may bring new supply woes.
Faury stressed that both Pratt and competing A320 engine supplier CFM, owned by GE Aerospace (GE.N) and Safran (SAF.PA), had pledged to stick to agreed quantities and cautioned against making too many assumptions about Airbus’ own production based on supplier remarks.
Referring to Pratt, which has suffered the most widespread problems so far, he said: “They have commitments that they have reconfirmed to us several times that they intend to stick to.”
Pratt & Whitney parent RTX declined to comment. Chief Operating Officer Chris Calio said in September “our plan currently is to continue to meet our commitments to Airbus,” while at the same time trying to send enough spares to airlines.
GE last month trimmed a 2023 growth forecast for total CFM LEAP engine deliveries and signalled a slower pace of growth for next year. It has said it is aligned with planemakers on demand.
Industry sources said there is little margin for error for Airbus as it is already below planned levels of production for small and medium jets, though there is scope to catch up later.
Airbus is producing A320-family jets in the low-50s per month instead of a planned level closer to 58, they said.
On the loss-making A220, Airbus reiterated plans to raise output to 14 a month. But it has been forced for now to ask some suppliers to slow down as it builds little more than five a month, compared with a current schedule closer to nine, they said.
Airbus declined comment on granular production figures.
It reiterated plans to deliver its extended-range A321XLR – part of a key battleground with Boeing – in the second quarter of next year. Faury said it was progressing well towards certification following scrutiny of a fuel tank design.
“We are working very closely with them in the spirit of supporting them, but we also expect from Spirit to well support Airbus. After all, we are their customer,” Faury said.
Spirit said it had nothing to add to comments by new CEO Patrick Shanahan who said last week that a similar price deal with Airbus was “an item of utmost urgency” and should address cost pressures on the A220, for which Spirit builds wings.
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