Hello All,
Airbus announced its first quarter 2024 orders and deliveries earlier this week. The European OEM is on an aircraft production recovery for the A330neo and A350, and ramp-up on the A220 and A320 to new levels.
Airbus wants to produce 14 A220s, 75 A320s, 4 A330s, and 10 A350s per month by the end of 2026. How did the OEM do during the latest quarter?
Production struggles across the board
The below table shows first-quarter deliveries during 2024 and previous years.
| Year | A220 | A320 | A330 | A350 |
| 2020 | 8 | 96 | 4 | 14 |
| 2021 | 9 | 105 | 1 | 10 |
| 2022 | 11 | 109 | 6 | 16 |
| 2023 | 10 | 106 | 6 | 5 |
| 2024 | 12 | 116 | 7 | 7 |
| YTD 2024 vs. 2023 | 2 | 10 | 1 | 2 |
| YTD Monthly Average | 4.0 | 38.7 | 2.3 | 2.3 |
While deliveries are higher vs. previous years for the A220, A320, and A330, they are still very far from long-term goals (29% for A220, 52% for A320, and 58% for A330). The A350 is still running well below 2022 levels (and only 23% of long-term goals), partly due to seat supply chain issues (Air France is badly affected by the issue).
Conclusion
Airbus still has a mountain to climb to reach long-term production goals. This blog does not believe they will be reached by the end of 2026 unless Airbus pulls off an unprecedented ramp-up while preserving quality. With Boeing’s latest production incident, there will be high scrutiny to avoid a major production problem.
This blog is skeptical about the A220 goal of reaching 14 units per month. The program is currently losing hundreds of millions of dollars per year. Airbus will likely be forced to purchase Spirit Aerospace’s Belfast plant that builds the A220 wings, knowing that Spirit loses money on those deliveries.
EPSILON AVIATION 
Spirit also loses money on its production of A350 carbon fibre wing spars according to its financials.
Its ‘fashionable’ to only raise this for the A220.
It doesnt make sense that Spirit paid real money for buying the plant and IP ( a lot previously funded by UK government) if its an ongoing money pit . It must be cash positive somehow.
https://www.theguardian.com/business/2019/oct/31/bombardiers-belfast-factory-sold-to-spirit-in-850m-deal
Thats $1.1 bill .
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good point that Spirit is also losing money on the A350 but the magnitude is lower.
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… I understand Airbus has challenges with the A220 production line. The steps set up by Bombardier to build the aircraft were not conducive to higher volume production.
… Can Airbus even increase production enough to make a profit without making changes to the aircraft? Are there some design elements to the A220 that just cannot be changed, and hold up production rates?
… How much of the production rate problems relate to Pratt and their GTF problems?
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GTF is definitely contributing to delays, but the program is overall struggling with reaching breakeven. I am not familiar enough to know what Airbus can do to make the program profitable, if anything.
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… My understanding is that profitability is a volume issue. Roughly speaking, to average down fixed costs.
…A while back I watched a factory floor thing on the A220. There were just all these kinks in the process. One thing about the A320 & 737, they have been manufactured for so long, that manufacturing those models is very efficient.
… That said, indeed, the GTFs were the biggest problem last year.
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yes it is true that as volumes increase A220 profitability should get better but if you look at historical deliveries Airbus has not been able to ramp up by more than 1 per month every year on average. As you pointed out Bombardier designed an excellent plane but they did not plan production well.
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Well, if this is the not-so-rosy situation for the better half of the duopoly, I don’t want to even think what the report for the other half is going to look like…
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yes as the twin post that i’ll do next show, Airbus is indeed the least dirty shirt by far
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