AIRBUS estimated it will deliver 820 aircraft this year, setting modest target as the planemaker contends with trade tensions, persistent supply constraints and an ailing space business.
The European planemaker’s projection represents a 7 per cent increase from 2024, and is roughly in line with the 823 units estimated by analysts, though well shy of the company’s peak in 2019. Shares in the Toulouse, France-based company fell as much as 3.4 per cent, even as Airbus released earnings for 2024 that met analysts projections.
The aircraft manufacturer continues to be held back by supplier woes that extend back to the Covid-19 pandemic. Progress will be slowed by Airbus taking over work from an ailing parts maker this year, while engine shortages will hold narrowbody output in the first quarter below year-ago levels.
The issues have made it harder for Airbus to press its advantage as airline customers clamour for new, more fuel-efficient planes and rival Boeing continues to work through years of crisis.
“The tension on narrowbody continues to persist,” chief executive officer Guillaume Faury said on a conference call. “We expect the situation to normalise” in the latter part of the year.
Adjusted earnings before interest and taxes will be around 7 billion euros (S$9.8 billion) in 2025, while free cash flow before customer financing is expected to be in the range of 4.5 billion euros – little changed from 2024’s result, Airbus said. Any financial forecasts don’t take into account the potential for tariffs as US President Donald Trump presses his America First agenda.
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The cash target reflects the impact of several hundred million euros tied to the integration of work from struggling supplier Spirit Aerosystems Holdings, slowing output in the near-term. Airbus will absorb some parts of that business, while Boeing is buying the majority of a company it once owned to gain tighter control over component manufacturing.
Issues with Spirit are currently putting pressure on the ramp-ups of both the A350 and the A220, Faury said. Without its contribution of structural components, “we just cannot build the plane,” the CEO said.
Airbus is proposing to pay an ordinary dividend of 2 euros for 2024, alongside a special payout of 1 euro.
Faury has pushed for a surge in output that would take Airbus well beyond pre-Covid levels and decisively separate the company from Boeing. Yet issues with its shaky supplier network have repeatedly frustrated these goals, forcing the French executive to repeatedly revise the targets.
Faury said he anticipates taking over Spirit work packages for the A220 and A350 by midyear. “We believe that adding this at Airbus, with our experts and our capabilities, that we will be able to do the ramp-up” in time to meet longer-term goals, he said.
Faury said it’s too soon to quantify any fallout from possible tariffs, given there’s still a “lot of uncertainty” about possible levies, their breadth and duration.
“Like other companies, we are in front of those uncertainties,” Faury said. “We have a lot of ways to adapt.”
Besides the commercial business, Airbus has struggled to turn around its defence and space operations. The company booked 1.3 billion euros in space-related charges in 2024, including 300 million euros in the fourth quarter.
Airbus recorded additional charges for its troubled A400M military transport plane, and said it was continuing to assess the impact of low order volumes on the production plan.
Further costs are in the offing to pay for job cuts once it’s reached an agreement with labour representatives. The company said last year that it plans to eliminate about 2,000 positions, an overhaul that’s focused on space.
Airbus has started exploratory discussions with Thales and Leonardo “aimed at assessing different scenarios to consolidate and strengthen the European space sector,” Faury said on the call. “What we expect is gaining scale and speed” needed to compete effectively.”
Bloomberg reported this month that Airbus had hired Goldman Sachs Group for advice on an effort to forge a new European space and satellite company that can better compete with Elon Musk’s dominant SpaceX.
Because of the troubles lifting output, a freighter version of the A350 will now come in the second half of 2027, a year later than initially planned. The company stuck with a target to make 14 per month of its smallest jet, the A220, by 2026, and 75 of the top-selling A320 narrowbodies by 2027. It also still aims to make 12 A350 widebodies a month by 2028.
The production holdups come at a time when Airbus has built a formidable lead in commercial jet deliveries over Boeing, though the US planemaker is showing signs of recovery under new leadership after a series of self-induced crises.
Airbus reported revenue of 69.2 billion euros in 2024, a 6 per cent increase from the prior year. Adjusted Ebit of 5.35 billion euros, an 8 per cent decline from 2023, matched the average estimate of analysts tracked by Bloomberg. BLOOMBERG
