Airbus has issued its first caution over the planned production ramp-up of its single-aisle aircraft to 40 units a month by 2010, saying that it will re-examine this plan later this year in light of a softening in the market.
"We have a decision today to go to rate 40 and we have no reason today to question that, but obviously we are watching the market and we'll see later this year, when the peak season finishes, whether we should revisit that plan," says Airbus chief executive Tom Enders.
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Airbus had a strong sales performance in the first half of the year, and has racked up 730 net orders to date, which means that the "850 orders for the year we said at the Berlin air show [in May] may have to be ramped up", says chief operating officer John Leahy. However, he cautions that "it's no secret that the market in the second half of the year is going to be much softer than in the first half of the year".
The airframer has a record backlog in excess of 3,600 units - of which 2,600 are for the A320 family models. This means that even assuming that "a third of the backlog could disappear" through cancellations or deferrals, then the single-aisle's 40 a month rate could still be maintained, says executive vice-president programmes Tom Williams. "With our worse case scenario, we could continue at 'rate 40' for two to three years," he says.
Williams says that airlines are responding differently in the current cycle due to the high fuel price. "Usually they'd defer new deliveries and keep their old aircraft, but with the current fuel delta it is more compelling to ground the old aircraft and take the new ones. The difficulty is getting financing."
So far demand for new aircraft has remained strong, with any deferred deliveries being snapped up by other customers, says Williams. "Every time we have an aircraft put back, we have two or three customers looking to take over the slot."
Source: Flight International
