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Airbus cuts A350 production as revenue slumps

Airbus cuts A350 production as revenue slumps

Airbus has seen revenue fall to €19 billion in the first half of financial 2020, down from €31 billion during the same period last year.

The collapse was driven by the difficult market environment created by the Covid-19 outbreak, with the commercial aircraft unit delivering around 50 per cent fewer planes year-on-year.

A total of 196 commercial aircraft were delivered in the last six months, down from 389 in the first half of last year.

These comprised 11 A220s, 157 from the A320 family, five A330s and 23 A350s.

Airbus’ reported adjusted EBIT of -€1,3 billion, down from a profit of €2.1 billion for the first six months of last year.

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The fall mainly reflected the reduced commercial aircraft deliveries and lower cost efficiency.

Airbus said steps had been taken to cut costs, including slowing A350 production to five jets a month, having brought the rate down from 9.5 to six in April.

“The impact of the Covid-19 pandemic on our financials is now very visible in the second quarter, with first half commercial aircraft deliveries halving compared to a year ago,” said Airbus chief executive, Guillaume Faury.

“We have calibrated the business to face the new market environment on an industrial basis and the supply chain is now working in line with the new plan.

“It is our ambition to not consume cash before mergers and acquisitions and customer financing in the second half of 2020.

“We face a difficult situation with uncertainty ahead, but with the decisions we have taken, we believe we are adequately positioned to navigate these challenging times in our industry.”

Airbus withdrew full-year guidance for 2020 in March.

The impact of Covid-19 on the business continues to be assessed and given the limited visibility, in particular with respect to the delivery situation, the company issued no new guidance.

Boeing yesterday reported huge financial losses and a slowdown in aircraft manufacture.