MIAMI – European Manufacturer Airbus has released its Q1 2020 results today which have shown the aerospace company is being hurt more than we had all first thought and much like many others around the world.
“We are now in the midst of the gravest crisis the aerospace industry has ever known,” says Airbus Cheif Executive Officer Guillaume Faury, giving a strong message out alongside the companies Q1 report.
The report shows a loss of €481m (US$522m), as countries continue to enforce restrictions on air travel, and the need for new aircraft quickly diminishes around the globe.
Despite the report showing heavy overall looses, it does include some good news for the European manufacturer, including gaining 290 new aircraft orders, something which is quite unprecedented given the current global market and demand for air travel.
Airbus Chief Executive Officer Guillaume Faury said, “We saw a solid start to the year both commercially and industrially but we are quickly seeing the impact of the COVID-19 pandemic coming through in the numbers.”
Airbus had a prosperous start of the year with 112 aircraft comprised of eight A220, 96 A320, four A330 and 14 A350 being delivered. This was only 40 fewer than those from the Q1 2019 results, which the manufacturer says was partly down to a more favourable foreign exchange environment.
However, Airbus was unable to deliver 60 of it’s built aircraft to its customers prior to COVID-19 lockdowns and restrictions.
The report did not go into detail on the break down of these aircraft, whose customers have had their orders delayed, an omission that would indicate that, just like many airlines around the world, Airbus is unsure of when restrictions will be lifted to resume deliveries.
Aircraft production Changes
Airbus confirmed the details on the announcement made in early April on the new production numbers for aircraft with the manufacturer saying monthly production rates would now be adjusted to 40 A320 Family, two A330, and six A350.
These reductions would see production levels around one-third of what they were pre-crisis.
In addition to this, Airbus said that the final assembly line in Mirabel, Canda is expected to progressive return to a monthly production rate of four A220 aircraft.
Furay said, “We’re adapting commercial aircraft production rates in line with customer demand and concentrating on cash containment and our longer-term cost structure to ensure we can return to normal operations once the situation improves.”
With the final impact of the COVID-19 crisis still not fully known, Airbus did confirm in the report that it would continue to implement cost-cutting measures in order to save the company,
One measure, announced in early April, was Airbus’ decision to halt plans on both the new A321 XLR production line and the A380 production line transformation.
Furay went on to say that Airbus was implementing additional measures to ensure its future. “We kicked off early by bolstering available liquidity to support financial flexibility. At all times, the health and safety of Airbus’ employees are our top priority.”
“Now we need to work as an industry to restore passenger confidence in air travel as we learn to coexist with this pandemic. We’re focused on the resilience of our company to ensure business continuity,” said Furay.
In all, it would appear that the strain on Air travel will be the biggest in the history of aviation. We are truly in uncharted territory with the restrictions and challenges we currently face around the world.
With airlines fighting for survival and after the implementation of these cost-cutting measures, the question remains on how manufacturers will be able to meet the demands for increased air travel in the years that follow.