Leeham News and Analysis
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Leeham News and Analysis
- Airbus 1Q2024 results: Airbus CEO: “A350 in-service experience drives positive reputation and orders” April 25, 2024
- A350-1000 or 777-9? Part 3 April 25, 2024
- Boeing CEO promises company is turning around…again April 24, 2024
- Solid start for stand-alone GE Aerospace despite cuts to LEAP output April 23, 2024
- SPEEA, Boeing at impasse over safety program, union says April 23, 2024
Airbus’ 9 months 2021 results; Full steam ahead
By Bjorn Fehrm
October 28, 2021, © Leeham News: Airbus presented its results for the first nine months of 2021 today. The company is now heading out of a 15 month COVID hibernation at full steam.
Market demand is strong for its Civil airliners and especially for the larger model in the A320 series. Airbus is now upgrading all four Global Final Assembly Lines (FALs) to A321 production capability.
The strong result came from deliveries of 424 commercial aircraft compared with 341 last year. Guidance remains at 600 airliner deliveries for the year but operating profit is raised to €4.5bn (was €4bn) and Free Cash Flow to €2.5bn (€2bn).
Group-level results
Revenue for 9M2021 was €35.2bn (€30.2bn 9M2020), operating profit €3.4bn (called EBIT adjusted, -€0.1bn 9M2020), and net profit was €3.4bn (-€2.2bn).
Free cash flow for 9M2021 was €2.3bn (-€12.3bn), and the net cash position end 9M2020 was €6.7bn (end 2020 €4.3bn).
Guidance for 2021 is now:
- Airbus targets 600 commercial aircraft deliveries for 2021.
- Airbus expects an EBIT Adjusted of €4.5bn (was €4.0bn after 2Q2021)
- Free Cash Flow of €2.5bn (was €2bn).
These are strong results and signals from a company that was hard hit by COVID19 over the last 15 months. The commercial aircraft side is now on full song and the daily problem is how to satisfy an increasing demand for Airbus’ airliners.
Commercial aircraft
Of the 424 delivered aircraft, 341 was A320/A321, 34 A220, 36 A350, 11 A330 and 2 A380. Net orders for the period were 133 aircraft.
Market demand for Airbus commercial airliners is “very strong” according to Airbus CEO Guillaume Faury. The ramp plans for the A320 family are therefore intact with rates of 45 now and 65 by summer 2023. Discussions are also ongoing with the supply chain if this can eventually be raised to 70 or 75.
Present supplier delivery problems are on an individual basis due to rehiring problems when the market turns. Airbus could use the European “Kurzarbeit” schemes to keep employment up and does not have the same problems. The company has started hiring again.
As the demand for the larger A321 increases (it’s 50% of production now), Airbus has decided to upgrade all FAL sites to A321 production. Today only Hamburg and Mobile can output A321s. Toulouse follows in 2023 and Tianjin thereafter.
Demand for the A330 has picked up and motivates an increase in the rate from 2 to near 3 by the end of 2022. A350 is presently produced at a rate of 5 and will increase to rate 6 in early 2023.
Helicopters
The helicopter increased revenue by 14% to €4.1bn (€3.6bn) and profits 32% to €0.3bn (€0.2bn).
Defense and Space
Revenues and profit were stable at €6.9bn (€6.9bn) and €0.3bn (€0.3bn).
Four A440M were delivered in 9M2020.
Interesting that AB delivered 49 widebodies in the first 9 months, despite the longhaul malaise. The recipients of those airframes now have actual planes that they can fly and generate revenue with. In contrast, poor Tim Clark still doesn’t know when (or even if) he’ll receive his 777Xs.
Also interesting to see that all 4 FALs are going to be producing A321s. Fits in somewhat with the continuing series of LNA articles on cargo demand: the whole A320 family can take containerized cargo, and the A321 can carry more than its siblings. Of course, Michael O’Leary won’t be able to get in on that action because of his all-737 fleet, but other LCCs with A321s may be tempted to start upping revenue by carrying some cargo…after all, one can easily unload/load a few LD3s during a 30 minute turnaround.
What does the 777X or Boeing have to do with this topic of discussion. You really can’t help yourself. a shame. It seems Boeing lives rent free in your head. Sad
You think that, on a day on which one OEM presents results and outlook, those can’t be compared with results/outlook from another OEM?
It’s called benchmarking.
I’m tempted to ask what planet you’re on…
Bryce, your fanboy tendencies are so ripe on this platform it’s kind of tiring.
Compare but you can compare without your constant sly digs. Like we get it mate. You don’t like Boeing. That’s fine. But I mean you’re constantly on and on and on about them.
The whole aviation press is “constantly on and on and on about” Boeing…hadn’t you noticed, “mate”?
Referring to Tim Clark’s frustrations is not a “sly dig”: Clark has given us plenty of opportunity to hear his various grievances in the press. And why wouldn’t he be vexed? His competitors — particularly right beside him in Qatar — are getting brand new, fuel-efficient widebodies whereas his are (at least) 3 years late, and potentially not up to spec.
If you’re unhappy with Boeing’s lot, then give Calhoun an earful rather than trying to take it out on others here. Various financial commentators on CNBC yesterday wiped the floor with Boeing — are you going to contact them to chide them for their “sly digs”?
Agreed. Over the top fanboying on every Airbus or Boeing post. I would not at all be surprised if Bryce works for Airbus’s PR team.
Interesting:
“Airbus A350F market potential above 100 units”
https://cargofacts.com/allposts/business/strategy/cfs-airbus-a350f-market-potential-above-100-units/
There is no space for 2 of them and they all know it. It’s either XF or 350F. and Fedex already seems to be getting cold feet
https://cargofacts.com/allposts/carriers/cfs-fedex-ponders-fleet-renewal-as-icao-deadline-looms/
The fact that Airbus ‘launched’ A350F without any customers is not exactly encouraging.
Because they rode the hype, they wanted to get that product to market quickly, they thought Boeing was not in position to respond when in fact Boeing had been working on the XF For about 6 years.
Now they actually have to convince people to buy their product for reasons other than it being the only new gen freighter.
XF is now in play, it’s a great freighter, it’s efficient, Leeham has shown us it moves more payload, has more volume and is already part of the Boeing ecosystem that’s about 90% of the freighter market but yeah it’s going to “sell over a 100 copies.”
FEDEX already expressed their reservations about the 350 freighter and it’s incorporating it, the training of pilots, engineers, let’s not forget it’s RR who is also non existent in the freighter market, engineers now have to be rated on those all that stuff costs money. And airbus has to foot the bill for every air cargo company that will buy that thing because they have a cheaper more capable alternative.
This is not the passenger market. The cargo market likes things cheap and straightforward.
For a cargo company what can the 350F offer you that the XF cannot already do better other burning a few less pounds of fuel
How do you want to get cargo companies to move OUT of their well managed Boeing ecosystem for a product that is not categorically better? And where Airbus can also make a profit on sales
Let’s get real
…and this commenter accuses others of “sly digs” and “fanboy tendencies”… 😉
One thing that A350F can offer is quicker time to market. 777X passenger version is nowhere near to be certified so who knows when Boeing manages to get 777XF ready. It might be also price – Airbus is in a better financial situation and it can afford to offer a very good deal to break into freighter market. Splitting the ‘Boeing ecosystem’ could be worth enough long time to justify short time losses.
However as mentioned, launching A350F with no customer suggests that this plan is not going to work and Boeing’s stronghold will remain unconquered for now.
-> “For a cargo company what can the 350F offer you that the XF cannot already do better other burning a few less pounds of fuel.”
Only if the XF is priced comparably as the 350F, right? Is BA willing to go that low??
-> “… when in fact Boeing had been working on the XF For about 6 years.”
Didn’t FAA come out to slam BA’s work on B777X and state that certification won’t happen until 2023 even though BA has been working on it for many years?
Let it sink in for a moment.
Axios: Amazon is now a bigger shipper in the U.S. than FedEx
https://pbs.twimg.com/card_img/1453664305723936770/3EWlA3V8?format=jpg&name=small
> XF is now in play, it’s a great freighter, it’s efficient <
"It" doesn't exist yet, and given its
[possible] maker's recent track
record, I will definitely wait and see.
more vaporware ?
It seems to me Calhoun may have been prompted to announce the B777-XF as a response to the A350F announcement. I don’t even think Boeing have authority to offer yet for the B777-XF, do they?
At least with the A350F there is now competition in the freighter market, that’s a good thing. Airlines with a freight operation (Lufthansa, Qatar etc) already operating A350 have an natural option.
One rumour is that the customer is Cargolux (on the basis of a call sign used by an airbus test flight) who being European based have no chance of escaping ICAO regulations.
… commenter accuses ….
This is a Jovi non Bovi thing.
any over the top statement about a Boeing potential future product is “just facts”.
slightl more realistic statement in relation to Airbus is nothing but common fanboism.
OK, We’ve got it.
Fully expect an announcement from Qatar airways at the upcoming airshow to officially launch the 777xf…
We could create an excel to compare 777-200LRF, 777-8F, A350-950F, 777-9F, 777-300BCF and a 2028 engine PIP’d 777-200LRF, with all data available and reasonable interpolations.
Objectively looking at program risks, payload, empty weight, efficiency, economies of scale, costs, I already have a pretty good idea which ones would come out on top, and which ones not. You don’t have to be an aeronautical scientist / modeler for that.
If I was Boeing I would consider asking GE to fix the GE90-115B into a 2028 compliant GE90-115C and keep producing 777-200LRF’s. If the 777F works, don’t fix it. Specially if the fix seriously risks being another 777x Pandora’s box
“If I was Boeing I would consider asking GE to fix the GE90-115B into a 2028 compliant GE90-115C and keep producing 777-200LRF’s”
A wise idea, in view of how shaky the existing 777X program is: if the passenger version bites the dust, will there be enough ROI to go ahead with the freight version?
It’s not going to ‘bite the dust’. It is 2 years from EIS and it already has more
solid orders than A380 had over its entire program lifespan. Boeing management would have to be insane to cancel the program after major expenses are already paid. So 777X will happen and 777XF will almost certainly happen as well. What might actually not happen is A350F since Airbus can’t find a single customer for it months after launch.
Boeing management won’t have to pull the plug if customers (particularly Emirates) walk away from the 777X. LNA has done several articles on the shaky order portfolio…they make interesting reading.
@Bryce of course you recgonise fanboy tendencies and sly digs its literally the only content you bring mate
Material like this for example. did they pull the plug on the 747-8?
Did airbus pull the plug on the 380?
Oh what of the 330neo, that has the weakest order book of all products on offer seeing as we’re since learned that airasia X wants to cancel all 78 jets
Airbus still counts Iran air’s 28 in that Orderbook. Take those away doesn’t look so pretty
🙂 Have a good one!
OK, Everyone: let’s knock off the fanboy stuff. Reader Comment Rules don’t allow for personal attacks.
Hamilton
@Scott
Right! Let’s get back to subs, covid and how the blasted phone needs to be changed, huh? 🙂
When BA wrote off $6.5 billion in Q4/20, they said that the order book for the 777X was at 190 under ASC 606 rules. Accounting block is 350
No need to do anything to the GE90-115b’S. The GE-9X is good for 110K on take-off – same thrust as what the 777F uses (Ge90-110’s)
> If I was Boeing I would consider asking GE to fix the GE90-115B into a 2028 compliant GE90-115C and keep producing 777-200LRF’s. <
A good call, and a likely scenario.
I think the 350F will probably appear in the real world; the 777XF I'm less sure about,
since its *base aircraft* has had so many issues, and delays into service.
ET phone home
Please find link to relevant AB website
https://www.airbus.com/investors/financial-results-and-annual-reports.html
I looked and looked, but no mention of if only China- no half hearted geopol pleading loved by CC and disapproved of by Mr Hamilton
Indeed: AB is expanding its FAL in China rather than whinging about the country.
As a backup, BA may instead be considering its chances in Russia, Ukraine and CIS:
“Boeing has predicted that airlines in Russia, Ukraine and the Commonwealth of Independent States (CIS) will require 1,540 new aircraft by 2040.”
“Randy Heisey, managing director of commercial marketing for Russia, Ukraine and CIS at Boeing, said: “Boeing is ready to support carriers in Russia, Ukraine and CIS as they transform their business models and take advantage of opportunities for further growth.”
https://www.key.aero/article/boeing-predicts-growth-russia-ukraine-and-cis-demand
Sounds like another wet firecracker to me…
Defecating on your (potential) customers doormat isn’t the perfect strategy to introduce yourself as a viable business partner.
Off-topic, but important because it relates to LH2 penetration into regional air travel. Also, even though not related to snowmobiles, wrestling or knitting, it may be of interest to the Alaska delegation 😉
“Alaska Air Group Collaborating with ZeroAvia to Develop Hydrogen Powertrain for 76-Seat Zero-Emission Aircraft”
https://www.zeroavia.com/alaskaair
I think ZeroAvia are using metal hydrides to store the hydrogen since their website illustration shows the hydrogen being stored in the wing. I recall there were a few breakthroughs in the UK in the technology a few years ago. The technology should also make its way into eVTOL and agricultural machinery. In 5 years the technology Airbus will have to choose from for their hydrogen program will be quite different. It’s becoming clear that hydrogen will work for aircraft up to the size and range now served by ATR-72 and Q400.
I read that AB is confident enough to lift production rate for both the A350 and A330, while BA remains coy about the B787/B777X.
The increase in the A330 rate is particularly interesting…
There’s a large A330 replacement market in e.g. China, Turkey, that might not automatically order Dreamliners. https://www.airfleets.net/exploit/production-a330.htm
Regarding Airbus’ planned future production hike, the up-and-down continues:
“Engine maker Safran renews concerns about Airbus output hopes”
“PARIS (Reuters) – French engine maker Safran (PA:SAF) said on Friday it had yet to be convinced about the case for raising Airbus A320-family jet output towards 70 to 75 a month, despite assurances from the planemaker on Thursday about the industry’s post-COVID outlook.
Chief Executive Olivier Andries said he saw no difficulty in producing enough engines to meet Airbus’ firm target of 65 a month by summer 2023, but voiced fresh doubts about its hopes of going well beyond that. He also noted global labour shortages.
“On the exploration of rates above 65, it is obviously a challenge, and for us the question remains the same – whether such rates can be sustained over the medium term. It is still an open question,” he told reporters.”
https://www.investing.com/news/stock-market-news/engine-maker-safran-renews-concerns-about-airbus-output-hopes-2660332
On the A220:
“Breeze Airways eyes Airbus A220 for long-haul flights”
Interestingly:
“ACJ TwoTwenty, a business jet version of the A220, which was unveiled by Airbus in 2020, can fly to destinations up to 5,650 nautical miles (10,464 kilometers) away. However, this range is reached owing to significant modifications that have been made to the aircraft, including auxiliary fuel tanks.”
https://www.aerotime.aero/29304-breeze-airways-eyes-airbus-a220-for-long-haul-flights
Quietly, very quietly, the A220 is creeping up on the narrowbody market. Two new carriers are getting it into their fleets in the next week or two, AF is picking up some more, Delta is grabbing some more -100’s. Mgmt has had to fend off questions of a -500, which is not a bad thing.
Now if they only could make the hamburgers cheaper…
The “ACJ TwoTwenty” operates under the MTOW of the A220 airliner variant it is based upon by carrying far fewer passengers but much extra fuel also leaving little room for cargo. That’s not an issue in a business jet.
To obtain more range on the A220 airliner variants Airbus will need to increase the MTOW and also install more fuel capacity. I don’t think either is a problem given the growth built into the C series by Bombardier. Simply increasing MTOW and fitting a few ACT will I suspect obtain the same range as the A321LR (4000-4200nmi) and developing an integral RCT type tank should take the aircraft to the same range, if not more, as the A321XLR. New engines aren’t even needed so this could happen sooner rather than latter.
An aircraft that can connect two cities (towns) over 4000nmi apart while being profitable with only 140 passengers will change things.
Not even JetBlue believes it’s a good idea to fly 140 passenger in a NB across the pond. The A220 is a smaller jet.
David Neelenan is the CEO of both JetBlue and Breeze. He’s the one making the request for a longer range intercontinental A220.
He has founded five commercial airlines: Morris Air, WestJet, JetBlue Airways, Azul Brazilian Airlines and Breeze Airways. Along with Humberto Pedrosa and Aigle Azur, he owned 45% of another commercial airline in Europe, TAP Air Portugal.
I think he’s a heavy hitter.
Developing an RCT would benefit both the business jet version and the potential A220-500 stretch.
If the 3400nmi range A321neo can be developed into the A321LR and A321XLR I think the 3400nmi range A220-300 can as well.
Yah, because I really enjoy being stuck in a sardine seating 9 or 10 across on a widebody on those flights. If the legroom is right, give me the A220 any day.
I really don’t understand the predilection of people who think that being on a widebody is better. You have two aisles…great. You also have three times the people.
As well, in economy 80% of the time you are guaranteed either a window or aisle seat. 40% of the time, you will get an aisle. Much better odds then on a wb.
Just my $.02
Widebodies have higher ceilings, and give a smoother ride in turbulence (larger dimensions and mass). The sidewalls also generally have less curvature = more shoulder room in a window seat. And, up to recently, very few NBs had personal IFE screens.
But sure, if a widebody is jam-packed with coughing passengers, with some crying babies in the mix, it can feel more cattle-like.
I’ll take an Emirates A380, thank you.
The A220-300 has 18 inch wide seats in a 3/2 arrangement. The centre seat in the 3 row side is even 19 inch to compensate this passengers.
Compare this to 17.4 inches on a B777-9 in 3/4/3.
The extra 1.2 inches possible between shoulders counts on an Airbus. I’m a big guy and if I’m next to another big guy we touch shoulders and it can get a bit annoying. If I’m next to a lady I tend to invade her space and this embarrass me. I can see why KLM went for the A220, those big Dutch guys need the space.
So in the A220 you will have
1 a much wider seat giving you 1.7 inches between shoulders in the 3 seat.
2 Be statistically much closer to both an aisle or window.
Much as I respect Boeing a lot of their ‘efficiency’ is just squeezing more people in a smaller space.
An A220 or A321XLR flying 4000nmi routes (about 9 hours) will have lower seat density. They won’t often if ever 10 hours due to the crew rest requirements.
What also matters is the availability of direct flights and/or availability of flights from smaller airports: a direct flight from a local airport on an A220 becomes a very attractive option when compared to a layover-flight on a widebody from a larger airport.
For example, if passengers in Fresno could fly directly to Hawaii on an A220, who’d be temped to instead drive to SFO and fly from there in a 787?
What I’m trying to say is a NB for long-haul is different from a NB for short-haul. The JetBlue A321 for London flights has 138 seats. Thus I said it’s not a good idea to fly 140 passengers ….
The Breeze A220 for domestic flights has a flexible layout, the one for media flight has 36 “first class” recliners and a total of 126 seats. The long-haul A220 is said to have 21 “flat bed” instead.
Interesting:
“Airbus operates (on October 28) the first A319neo flight with 100% sustainable aviation fuel”
“Airbus, Dassault Aviation, ONERA, the French Ministry of Transports and Safran have launched the first in-flight study of a single-aisle aircraft running on unblended sustainable aviation fuel (SAF).
During the flight test over the Toulouse region on October 28, 2021, one CFM LEAP-1A engine of an Airbus A319neo test aircraft operated on 100% SAF. Initial results from the ground and flight tests are expected in 2022.
The unblended SAF is provided by Total Energies. It is made from Hydroprocessed Esters and Fatty Acids (HEFA), which primarily consists of used cooking oil, as well as other waste fats. HEFA is made of paraffinic hydrocarbons and is free of aromatics and sulfur.”
https://worldairlinenews.com/2021/10/30/airbus-operates-the-first-a319neo-flight-with-100-sustainable-aviation-fuel/
” … upgrading all four Global Final Assembly Lines (FALs) to A321 production capability”
What’s next?
Laying the ground work for A321 plus/A321 plus plus?