Airbus Must Step Up Plane Deliveries to Reach Its Annual Target

(Bloomberg) -- Airbus SE needs to almost double jetliner deliveries next month to meet its target for full-year handovers, setting up a race to accelerate production over coming weeks.

The European planemaker handed over 77 planes in November, the same number as in October, according to a statement Thursday. That leaves the company 135 aircraft shy of its 12-month target of 860 deliveries.

Key Insights

• Jetliner output is being held up mainly by the introduction of new “Cabin Flex” options for Airbus's A321neo model. The manufacturer is allowing airlines to increase customization of the plane after stretching its range, adding complexity to the manufacturing process.
• The full-year delivery target is already 20 down on an earlier goal after Airbus acknowledged in October that its plants couldn't cope. Chief Executive Officer Guillaume Faury said last month that A320-series output won't be fully on track until 2021. Deliveries are now booked out until 2024.
• November proved a bumper month for new orders, with Airbus logging 222 aircraft sales, most of them from the biennial Dubai Airshow. The biggest deals saw discount carrier Air Arabia PJSC purchase 120 narrow-bodies and Gulf super-carrier Emirates add 50 long-haul A350s, though it didn't didn't confirm other outline deals.
• Airbus has logged 718 net orders this year, while rival Boeing had a net figure of minus 95 through October. That reflects a slump in firm deals for the U.S. company's 737 Max model, grounded since March after two deadly crashes in five months.

Market Reaction

• Airbus shares have surged 51% this year, buoyed by better-than-expected demand for the long-range A320 variants. Boeing is up 8%.

To contact the reporter on this story: Siddharth Philip in London at sphilip3@bloomberg.net

To contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net, Christopher Jasper

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