Airbus Lifts Delivery Target With Boeing Gripped by Max Crisis

(Bloomberg) --

Airbus SE plans to increase jetliner deliveries to an all-time high in 2020 as it irons out production snags involving the A320 narrow-body model while Boeing Co.’s rival 737 Max remains grounded.

  • The European planemaker aims to hand over about 880 jets, up from 863 in 2019, which was already a record. It’s targeting free cash flow of 4 billion euros ($4.3 billion), a 500-million-euro increase.

Key Insights

  • The Toulouse, France-based group bolstered its advantage in the narrow-body market, where Boeing Co.’s Max is grounded, raising its stake in the A220 jet developed by Canada’s Bombardier Inc.
  • Airbus said it’s looking at lifting build rates for its best-selling A320 narrow-bodies beyond the targeted 63 a month, with discussions underway to add one or two more a month after 2021.
  • While demand for single-aisle jets is soaring, production of the wide-body A350 will be held at nine or 10 a month in 2020, with deliveries of the mid-sized A330 dropping to around 40 for the year from 53.
  • Airbus had a net loss after a 1.2 billion-euro charge against the A400M military transport plane, partly due to a German ban on military exports to Saudi Arabia.

Market Reaction

  • Airbus shares had gained 4.7% this year as of Wednesday’s close. That follows a 55% jump in 2019, when Boeing rose just 1% after two fatal crashes involving the Max tipped the U.S. company into crisis.

Read More

  • Airbus had 2019 adjusted earnings before interest and tax of 6.95 billion euros, ahead of estimates. It’s targeting 7.5 billion euros this year, before a 3.6 billion-euro settlement for a bribery probe.
  • To see the statement click here.
  • Airbus Lifts A220 Jetliner Stake to 75% as Bombardier Exits

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