Airbus Deliveries Impacted by Parts Shortages on Engines, Aerostructures, and More

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Aviation Safety and Tech

Airbus tries to Navigate a difficult Turbulence: Parts Shortages Disrupt Jet Deliveries

Airbus SE, the world’s largest aircraft manufacturer, is facing significant challenges due to a severe shortage of millions of parts essential for its commercial aircraft production. The shortages, affecting engines, aerostructures, and cabin interiors, are forcing the company to revise its delivery plans and financial forecasts.

The situation, worsening rather than improving, has led Airbus to reduce its 2024 aircraft delivery target from 800 to 770 units. This adjustment impacts their flagship A320 model and reflects broader supply chain constraints that have plagued the industry since the pandemic disrupted global aviation.

CEO Guillaume Faury highlighted that engine shortages have become a critical pinch point, adding a new layer of complexity to the existing supply chain issues. This unexpected challenge has prompted Airbus to push back its goal of producing 75 A320 jets per month to 2027, further exacerbating the shortfall in new jets, especially as Boeing faces similar production woes.

American Airlines, a major Airbus customer with nearly 500 jets, is among those affected by delivery delays, forcing them to rely on older aircraft. The ripple effect is also felt by suppliers, with companies like Safran SA and MTU Aero Engines AG experiencing declines in their stock prices due to the cascading impact of Airbus's revised outlook.

The financial implications are substantial. Airbus adjusted its expected earnings before interest and tax to €5.5 billion, down from a previous target of up to €7 billion. Free cash flow projections were also cut to about €3.5 billion. This stunning profit warning led to a significant drop in Airbus shares, which fell by as much as 12.4% in Paris.

Faury acknowledged that the economic and geopolitical challenges contributing to these supply chain disruptions are likely to persist for the next two to three years. He emphasized the need for the company to adapt its goals accordingly.

Airbus's revised plans come amid ongoing discussions with Spirit AeroSystems Holdings Inc., as the company considers strategic options including potential acquisitions and restructuring to address its supply chain challenges.

The Toulouse-based manufacturer also faces €900 million in charges related to space program complexities, with a review of these programs nearing completion. This comprehensive reassessment underscores the broader difficulties Airbus faces as it navigates an increasingly challenging landscape.

As the airline industry continues to recover, Airbus's ability to overcome these obstacles will be critical, according to reports, an insider thus remarked: in the normal case, if Airbus ought to face situation like this, then it would hardly take a hand wave to set all of the things correct, but today with geopolitical challenges, that has almost alienated Airbus from the supply chain source, it would take more than a hand wave, may be a flat ought bow to get the planes in air. He, continued, this is the hard truth that we as engineers and technicians know, but apparently the element of ego among the higher ups without considerations for the workforce and their families, is something nobody talks about and that will be critical in solving things.

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