Airbus is leaving archrival Boeing behind in its engine wake
Deliveries of new Airbus aircraft are set to grow 18% to a total of around 720 this year, the company said, surpassing the 2017 level but still far from its pre-COVID record high of 863 planes.
“We have a lot on our plate for 2022,” chief executive Guillaume Faury told reporters on Thursday, after reporting record high annual profits. “Ramping up production of our A320 family will remain at the heart of our priorities, and we will continue to work closely with our suppliers to make it happen.”
By comparison, Boeing only managed 340 deliveries last year, barely more than half that of Airbus. It hasn’t even provided concrete guidance going forward.
That’s because the Chicago-based Boeing first has to complete rework or recertification for key aircraft families. Boeing has halted shipments of its 787 wide-body since last May owing to faults in the airframe, reportedly affecting parts made from carbon fiber composites as well as titanium. While it hopes deliveries of its 737 Max to customers in China can resume in the course of 2022, it said earlier this year the rate and timing remains unknown.
A legal dispute between Airbus and Qatar Airways could give Boeing a tiny opening. Airbus took the highly unusual decision to cancel an order for 50 narrow-body A321neo planes placed by the Gulf carrier, which claims it has discovered paint degradation in its Airbus fleet that poses safety risks.
As a result, Boeing was able to scoop up an order for up to 100 planes at the end of January from the Middle Eastern airline.
Bulging order books
In its Thursday earnings announcement, Airbus reported record net income of €4.2 billion ($4.8 billion) and higher cash reserves on balance, prompting the group to reintroduce a €1.50 dividend per share.
This would be the first time it distributed cash to its investors since the company scrapped the planned 2019 payout worth €1.80 each at the start of the pandemic.
While Boeing, which reported in late January, more than halved its annual net loss in 2021, it still reported the company was $4.2 billion in the red owing mainly to a $3.5 billion charge in the fourth quarter related to the delivery delays in its 787 program.
Surprisingly, underlying demand is not a problem for either manufacturer despite the ailing health of many airline customers. They effectively carve up the global market for passenger and freighter aircraft between them and still sit on thousands of backlogged planes on their books.
Airbus registered 7,082 aircraft at the start of the year, one reason why it could afford to turn down the business from Qatar Airways. Meanwhile Boeing estimated it had over 4,200 valued at $297 billion. (There’s no equivalent value for Airbus as the company ceased reporting the list price of its models back in July 2019.)
Keeping their workers busy is not the problem then; if anything the airplane makers worry more about how quickly they can ramp up production at both their factories and those of their suppliers. It’s more a question of Airbus and Boeing juggling their delivery schedule to match the financial health of their customers.
Carriers that cannot immediately afford a plane they had ordered are bumped down the waiting list in favor of those like Irish budget group Ryanair that need added seat capacity to expand their routes.
Never miss a story: Follow your favorite topics and authors to get a personalized email with the journalism that matters most to you.