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A220 production increase | Easier said than done

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Essential for getting the A220 out of red, the acceleration of production is becoming more complex at Mirabel and Mobile, Alabama. Deliveries have leveled off since the beginning of the year and the second largest customer, JetBlue, already expects to receive fewer aircraft in 2023.

For Bombardier’s former C Series – 25% owned by the Quebec government – ​​any delay in ramping up is a risk to achieving profitability, an objective already postponed in the middle of the decade. Even if Airbus stays the course, some have doubts.

“It is quite reasonable to believe that this [le seuil de rentabilité] could be delayed for a year, says American analyst Richard Aboulafia, managing director of the firm AeroDynamic Advisory. It’s not the market or the product. It’s the supply chain. »


PHOTO FROM AERODYNAMIC ADVISORY WEBSITE

Richard Aboulafia is managing director of the firm AeroDynamic Advisory.

Quebec returned 380 million to the program last February following a call for capital launched by Airbus, the majority shareholder. This had made it possible to postpone to 2030 the moment when the multinational will buy out the Quebec government’s stake in the A220. The value of the investment was “zero” on March 31, 2021. The longer the profits are delayed, the more the amount obtained by the State risks being reduced.

“The value of the program depends on the production,” says Mr. Aboulafia. But seven years is an eternity in the aviation industry. »

Reduced expectations

An overview of the problems affecting aircraft manufacturers like Airbus and Boeing was offered by JetBlue on Tuesday, which presented its second quarter results. The American carrier expected 29 planes, including 18 A220s, in 2023. It is now counting on 22 deliveries. Four A220s have been removed from the forecast.

“I believe that we are all aware of the fact that they [Airbus] are facing ramp-up challenges,” Ursula Hurley, chief financial officer of the New York carrier, said in a conference call with analysts.

The A220 is not the only program where there are challenges. Last summer, Airbus pushed back the production ramp-up of its A320 family by six months due to difficulties in obtaining components from its suppliers. Airbus aims to produce 14 A220s monthly around 2025. Despite stagnating deliveries, the aircraft manufacturer claims to produce six aircraft per month.

Stuck

After the first nine months of the year, Airbus delivered 34 copies of the A220, the same number of aircraft as a year ago. In 2021, the aircraft manufacturer had handed over 16 aircraft to customers during the last three months of the year. This is the target to be reached to avoid a decline in 2022.

“It will be tough, recognizes the head of communications of Airbus Canada, Annabelle Duchesne. We anticipate close deliveries towards the end of the year. There is an additional difficulty that has been added. »


Without advancing on a target, Mme Duchesne said “it’s the year-end numbers that matter” for deliveries.

According to our information, Airbus is changing its ways of doing things within its assembly line in order to adapt. For example, the exterior of an aircraft fuselage can sometimes be painted in customer colors even if its interior layout is not 100% complete because some parts are missing.

“Sometimes manufacturers have an excellent fourth quarter, but I must say that things are not looking very good,” observes Mr. Aboulafia, who anticipated between 65 and 70 A220 deliveries this year.

It was not possible to obtain a reaction from the International Association of Machinists and Aerospace Workers (IAMAW), which represents Airbus union members in Mirabel.

A worrying signal

Mehran Ebrahimi, professor at the University of Quebec in Montreal (UQAM) and director of the Observatory of Aeronautics and Civil Aviation, agrees that the signals sent by JetBlue and the statistics of Airbus suggest that the A220 “has not progressed on the delivery side and that it should deliver strongly to do what was done last year”.

However, the expert believes that one element plays in favor of the program: the pre-assembly line inaugurated at the beginning of the year in Mirabel. These are the facilities where electrical wiring, floors and other modules are installed in the fuselages, which then end up on the assembly lines in Mirabel and Mobile, Alabama. The objective of the multinational is to bring together the preparation activities of the fuselage sections in one place.

“This channel is not yet fully operational,” says Mr. Ebrahimi. We cannot yet measure its full contribution. »

Asked about the possibility of seeing the A220 take longer than expected before generating profits, the expert did not want to come forward like Mr. Aboulafia. According to Mr. Ebrahimi, Airbus will not be able to work “miracles” to fix all the wrong things in terms of supply.

Learn more

  • 106
    Number of orders won by the A220 since the beginning of the year.

    source: airbus

    1.3 billion
    Initial investment by Quebec in the ex-Bombardier C Series.

    source: government of quebec



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