Lower Airbus deliveries put focus on ‘challenging’ target

PARIS – Airbus deliveries fell 9 per cent in September to 50 jets compared with the same month in 2023, the European planemaker said on Oct 9, rekindling a debate over the strength of its industrial goals as suppliers struggle to keep up with demand.

The deliveries figure, which confirms a recent Reuters report, brings the total so far in 2024 to 497 jetliners, up 2 per cent from 488 at the nine-month stage in 2023.

Airbus is targeting 770 deliveries for the full year after reducing its goal from 800 jets in July, citing shortages of engines and other parts as the aerospace industry’s supply chain struggles to recover from the Covid-19 pandemic.

Reuters, quoting industry sources, reported on Oct 4 that Airbus had delivered 50 jets in September, leaving it facing a sprint towards the finish line in the busy fourth quarter.

Airbus has said it is on track to meet its annual target of “around” 770 jets.

The figures suggest that Airbus would have to deliver 273 aircraft in the fourth quarter to meet its headline target figure, up 11 per cent from the same quarter in 2023.

Analysts disagreed whether the planemaker would once again recover lost momentum in the fourth quarter, a period during which it traditionally speeds up but has occasionally stumbled.

Agency Partners analyst Sash Tusa said Airbus’ 2024 guidance and later deliveries “increasingly look a stretch”. He also raised concerns about the underlying production of single-aisle planes that had failed to make visible progress towards a goal of 75 a month by 2027, recently pushed back from 2026.

Industry sources and analysts estimate current production of the single-aisle A320neo family at around 50 a month.

“The A320 rate ramp is simply not coming through,” Mr Tusa said in a note.

Bernstein Research analysts said they now saw risks to Airbus reaching its goal of 770 deliveries and cut their forecast to 750, echoing a similar prediction from consultancy Cirium Ascend. They also cut their forecast for deliveries in 2025 to 820 jets from 880.

Investment bank Jefferies, however, said Airbus should be able to reach its 2024 target, albeit with a risk of coming in as low as 760.

“The 2024 guidance, while challenging, is still within reach,” Jefferies analyst Chloe Lemarie said.

Jet deliveries drive revenue and play a key role, alongside a new programme of cost cuts, in shaping operating earnings, which Airbus will report for the third quarter on Oct 30.

Monthly delivery data was overshadowed by a profit warning from a key supplier.

Senior, which supplies to both Airbus and Boeing, said on Oct 8 that it was cutting headcount in response to challenges in commercial aerospace manufacturing, sending its shares tumbling.

Senior said it was resorting to both furloughs and job cuts in response to an ongoing strike at Boeing’s commercial aircraft operations and supply chain issues facing Airbus.

Airbus, meanwhile, said it had won 235 new orders in September, including demand from an undisclosed customer for 75 narrow-body jets and 10 wide-body A350s. So far in 2024, the world’s largest planemaker has won orders for a total of 667 jets, or 648 after cancellations.

Airbus does not publish a target for orders, but industry sources said it was informally aiming for about 1,100 net orders. REUTERS