Tom Enders is not the kind of man that beats around the bush. “We have challenges galore in this company,” the 59-year-old chief executive of Airbus admitted, naming Brexit, protectionism, and a pending trade war between the U.S and China and the U.S. and Europe as external challenges. But, he added reassuringly, “Airbus has always thrived on challenges and I am very optimistic about the future of Airbus and this industry. We’re in the third revolution of aerospace and Airbus will come out of this very strong.”
While this year’s Farnborough Airshow will be Enders’ last one as head of the European OEM, it will be Airbus’s first one with a two-member family of small single-aisle aircraft: the A220-100 and -300, the rebrand from Bombardier’s CS100 and its larger variant CS300, respectively. The manufacturer’s static display here is featuring three A220s, indicating its interest in promoting the aircraft.
“We can now throw, and we do throw, all our weight behind the C Series. You will soon see the benefits in terms of procurement on costs and sales. Watch this space,” Enders said. Airbus, he added, has a competitive advantage compared to arch-rival Boeing because its venture with Bombardier’s C Series is “up and running” whereas Boeing’s tentative $4.75 billion deal for a controlling stake in the commercial aircraft arm of Embraer is expected to close only at the end of 2019. “We were lucky to be the first mover and have the support of all stakeholders,” Enders asserted. Airbus on July 1 took effective control of C Series Aircraft Limited Partnership, following a deal announced in October 2017.
Change of Mind
Former Airbus chief salesman John Leahy once described the C Series as a “cute little airplane,” but the company now sees the aircraft as a worthy complement to its single-aisle family. “We now have full market coverage, in terms of range and capacity,” said Antonio Da Costa, head of product marketing.
Airbus expects to sell a “double-digit” number of the jets this year, said David Dufrenois, the program’s head of sales. It raked in a first commitment from JetBlue on July 10, for 60 A220-300s, with deliveries to start in 2020, and another 60 options for delivery from 2025. The U.S. airline also converted 25 of its current orders for A320neo aircraft into orders for the larger A321neo. JetBlue’s A321neos and A220s will be powered by Pratt & Whitney GTF engines.
“JetBlue’s selection of the A220 as a complement to its growing A320 family fleet is a tremendous endorsement—both of the A220 itself and of the way these two aircraft can work together to provide airline network flexibility and a great passenger experience,” noted Airbus chief commercial officer Eric Schulz. JetBlue was also in talks with Embraer to replace its existing fleet of 60 E190s with E2s.
Bombardier delivered 17 C Series last year. The new venture, in which Airbus holds a 50.01 percent stake, aims to double that figure this year. Executives remained tight-lipped on the 2019 delivery goal, with Da Costa saying only, “It will be assessed with Airbus.” The main A220 assembly line remains at Bombardier’s plant in Mirabel and Airbus plans to have a second line operational at its facilities in Mobile, Alabama in 2020. “The U.S. market accounts for 40 percent of the 100- to 150-seat category market, so we will need Mobile to be up rapidly. We can’t have customers waiting for their aircraft,” he said.
Race to Delivery Target
Meanwhile, several customers are suffering delays in the delivery of their A320neos mainly due to the type’s persistent engine problems, a situation that Guillaume Faury, Airbus president Commercial Aircraft, admitted is “stressful.” But Airbus and the engine manufacturers—Pratt & Whitney and CFM— have seen progress on mitigating the delays, according to Faury. “In May and June we delivered more neos than ceos,” he said, adding that the number of gliders—A320s without engines—parked at Airbus facilities had fallen to 86 at the end of June from around 100 at the end May. The OEM handed over just 303 aircraft to customers in the first six months—239 single-aisle aircraft, including 110 A320neo family aircraft, 18 A330s, 40 A350s, and six A380s. The A330 output is compared to 30 units in the year-ago period amid low demand for the widebody and the transition from the ceo to the neo, with the latter “becoming reality,” Feury pointed out. The A330-900neo, on display here, is the final stage of certification.
Despite the slow pace of deliveries in the first half, Enders is confident that the company will meet its target of 800 aircraft this year. “It will be hard. But it is doable, absolutely,” he stressed during a press briefing in London ahead of the airshow.
“The roadmap is clear, we have an exceptional backlog to deliver,” Faury said. As of June 30, Airbus’s overall backlog across the A320, A330, A350 XWB, and A380 product lines stood at 7,168 aircraft, representing approximately nine years of production at current rates. A320 family aircraft account for about 85 percent of the backlog. The inauguration of the fourth A320 production line in Hamburg last month is a key enabler for ramping up the single-aisle programme to 60 aircraft per month by mid-2019. Analysing the possibility to move to the so-called “rate 70” is the next step, Faury revealed, “but first indications show that our engine manufacturers are not yet ready to commit to higher rates.”
This could be problematic for the future as Airbus raised its forecast for aircraft demand over the next 20 years. It now expects the market will need 37,390 new passenger and freighter aircraft, around 2,500 more compared with the OEM’s outlook last year. The bulk of the new deliveries, 28,550 aircraft, will go to what the airframer categorises as the “small” segment (from 100 to 230 seats and a range up to 3,000 nm). According to Airbus, it controlled a 54 percent share of the global passenger aircraft backlog at the end of 2017 and a 54 percent share in the “small” segment.