Airbus jets delivered in Q1 dropped to 127, sources say

The number of Airbus (AIR.PA) jets delivered on an industrial basis fell by 11% to 127 in the first quarter, underscoring the pressure on global supply chains, and paving the way for a 12-week sprint aimed at reversing the downward trend by the middle of the year.

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Delivery numbers decreased by 11% from 142 physical deliveries in the same period last year, or by 9% when compared with an adjusted year-ago total of 140 deliveries. Due to Western sanctions on Russia last year, Airbus had to claw back two deliveries in order to comply with the sanctions.

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Sources tell Trade Algo that Airbus delivered a total of 11 wide-body aircraft in the first quarter of 2023, including five A350s, ten smaller A220s, and 106 of its best-selling A320neo family aircraft.

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As of now, Airbus has declined to comment ahead of an upcoming release due to be released on April 11, when rival Boeing (BA.N) will be reporting its own deliveries.

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From January to March, Airbus recorded a decrease of one-third in deliveries from the previous month and reduced its cumulative deficit year-on-year from 16% to 11% due to a decrease in deliveries in January.

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On the other hand, there has been no sign of improvement in supply chain or industrial problems that have spread to premium wide-body cabins over the last few months, which sources, speaking on condition of anonymity, said had been a major concern in the first quarter of this year.

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There was a significant drop in the number of aircraft operated by long-haul carrier A350 from a total of 16 unadjusted aircraft a year earlier to just five this quarter.

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Mid-Year Deadline

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Since airlines and lessors are responsible for most of the costs associated with the delivery of a plane, it is delivery that sets the tone for profits and cash flow.

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Guillaume Faury, the company's chief executive officer, announced on Thursday that a new assembly line at the Airbus factory in China would increase its medium-term output targets and allow it to gain deeper access to a key market.

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Also, the company has bolstered a system called a "watchtower" in order to monitor lower tiers of the supply chain in the event that something goes wrong.

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However, the shortfall in first-quarter orders keeps Airbus under pressure to accelerate deliveries in the current quarter or at the very least gain enough visibility to either confirm or review its annual delivery goal of 720 aircraft by the mid-year point.

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In order to reach its delivery target last year, the company had to lower it several times before finally abandoning it as supply woes swamped its forecasts for the year.

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Faury, who has called 2023 a make-or-break year because of last year's downgrades, is determined to avoid flying blind into the second half, which means that half-year performance will likely act as a deciding factor when it comes to delivery goals and operational planning in the second half.

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Despite this, both Airbus and Boeing are ramping up production in an effort to meet the growing global demand for their products. It was reported on Thursday that Fury said the new line in China would leave valuable additional "surge" capacity for future expansions.