A380 suppliers are frantically adjusting delivery plans and schedules. Airbus chief executive Christian Streiff acknowledges that the restructuring and cost-cutting plan for Airbus will also involve the company’s suppliers. “We are aware that after the customers, our suppliers are our most important partners,” says Streiff. Airbus was due to hold an initial supplier conference call last week.
In the UK, Rolls-Royce has suspended production of the A380’s Trent 900 engine for at least 12 months. In the USA, Engine Alliance (EA) – the General Electric/Pratt & Whitney joint venture which builds the alternative GP7200 engine – is likely to be one of the most severely affected.
P&W, which undertakes final assembly at its Middleton, Connecticut site, says it has “no immediate plans for change [in workforce]”. The company believes it can rejig its plans on other lines to accommodate the employees who had expected to be working on the GP engines.
Programme sources say, however, that the latest A380 delay has been a “big shock to the system”, and has caused a flurry of urgent negotiations throughout the supply chain.
Talks between Airbus and EA are expected to be further complicated by the prospect of changes in the mix of GP7200 and Trent-powered aircraft in the revised delivery schedule. Pratt & Whitney Canada, which produces the PW980 auxiliary power unit, says it does not expect lay-offs.
The crisis at Airbus has sparked particular fears among local French suppliers. Martin Malvy, president of the Midi-Pyrénées region, where Airbus is headquartered, says the “whole industrial fabric faces challenges from the cost-cutting measures announced by EADS and from a possible change in Airbus’s internal organisation across Europe”.
Other suppliers are playing down the financial implications. MTU Aero Engines says: “The delay will not have any effect on our profits, but just lead to a slip of our revenues of around €100 million [$127 million] for the period of 2006, 2007 and 2008.” B/E Aerospace expects A380 delivery delays to have a negative impact on its revenue and earnings in 2006. Goodrich expects a “slightly reduced” cashflow in 2006, but thinks the impact will be temporary.
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Source: Flight International
