Airbus SE reported its 2Q/first-half 2020 results, further revealing the scale of the losses that the COVID-19 pandemic has imposed on the commercial aircraft industry. With a first-half loss of €1.9 billion ($2.255 billion), compared with 1H 2019 profit of €1.2 billion ($1.42 billion), Airbus noted it booked just eight new orders for aircraft during Q2, after 290 new orders in Q1.
Along with production and job cuts it has implemented to address its losses, CEO Guillaume Faury emphasized that Airbus has set a corporate objective to conserve cash. The group also indicated it does not expect to increase its production rate again sooner than 2022.
Airbus now holds a backlog of 7,584 orders for commercial aircraft, though it has imposed a company-wide production cut to manage the slower rate of deliveries, now that airlines have reduced their orders.
“The impact of the COVID-19 pandemic on our financials is now very visible in the second quarter, with H1 commercial aircraft deliveries halving compared to a year ago,” commented 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."
At the start of July Airbus put forth a plan to reduce total employment by 15,000, a process that is ongoing.
Airbus also implemented a slower production rate across all its product series, in line with the new business forecast since the onset of the pandemic. It reduced A350 wide-body production rate from six aircraft per month to five, and the A320 narrow-body production rate by 30%, to 40 jets/month.
The A220 jet final assembly line in Mirabel, Quebec, is expected to return to its pre-COVID assembly rate of four aircraft/month, while the new final assembly line in Mobile, Alabama, opened as planned in May.