Boeing and Airbus lose $641 million and $523 million in the first quarter of 2020
Two planmakers released the results on Wednesday and expect further losses in the coming months
Boeing and Airbus released the first quarter of 2020 results almost at the same time on Wednesday. And both had a significant loss, of $641 million for the US manufacturer and 481 million euros ($523 million) in the European group.
For Airbus, the outlook was reversed with the pandemic. “We saw a solid start to the year both commercially and industrially but we are quickly seeing the impact of the COVID-19 pandemic coming through in the numbers,” said Airbus CEO Guillaume Faury.
Boeing acknowledged the negative impact of the coronavirus: “The COVID-19 pandemic is affecting every aspect of our business, including airline customer demand, production continuity and supply chain stability,” said Boeing President and CEO David Calhoun.
In common, the two planemakers see a pessimistic future for commercial aviation, with the collapse of air traffic and the consequent reduction in the number of aircraft orders. Airbus, however, chose not to make predictions in the face of the current “limited visibility”.
The manufacturer said it could not deliver about 60 aircraft in the first quarter due to the COVID-19 pandemic. This situation reflected in the adjustment of the monthly production rate of its commercial jets, which reduced to 40 A320, 2 A330, 6 A350 and 4 A220 aircraft.
Airbus had revenue of 10.6 billion euros in the first quarter, of which 71% from the commercial jets line and which fell by 22% compared to the same period in 2019.
Cut in production and jobs
Boeing’s outlook is even more delicate. With a total revenue of $16.9 billion, including the defense and services divisions, the U.S. manufacturer had a 26% drop compared to 2019. But the circumstances in the commercial aircraft line is even more impacting: 48% drop , from $ 11.8 billion in revenue to just $ 6.2 billion.
The company delivered only 50 planes in that period, a third of what it had done last year. For this reason, Dave Calhoun announced cuts in production for the 737, 7777 and 787 models.
With production suspended since January, the 737 Max should have its assembly line reactivated soon, however, the goal is to reach up to 31 planes produced per month in 2021. Before the crisis caused by accidents with the model, Boeing even planned to raise monthly production for 57 aircraft.
As expected, the manufacturer also cut production rates for the 787, now its most produced model, once again. It will be from the current 14 planes to just seven jets per month by 2022.
As for the 777, Boeing defined that only 3 planes will be manufactured per month, either the classic model or the new 777X, which is still in the certification phase.
Boeing’s CEO also intends to reduce the number of employees by 10%, which means something like 16,000 people. Most of these layoffs will be made in the commercial aircraft division.
With 136,500 employees, Airbus does not yet speak of layoffs, but this week announced the furlough of 3,200 employees at a unit in Wales, UK.
Fearful to imagine what results the two aerospace giants will show in three months.[DISPLAY_ULTIMATE_SOCIAL_ICONS]