Falling Orders Forcing Airbus To Reduce A400M Aircraft Production Rate

Airbus is considering slowing down the production rate of the A400M military transport aircraft to lengthen activity at the final assembly line in Seville and gain time to get new customers.

The company has a backlog of 174 aircraft and has delivered 46 units, ABC De Sevilla reported Saturday.

The latest intercompany committee document, where trade unions report on the outcome of a meeting with the company's management team, "for the A400M, it is necessary to define the number of aircraft that each of the client nations can accept, and adjust production rate to demand." 

The document points out that there is already a consensus opinion that Airbus "will not deliver aircraft to the maximum of its industrial capacity, although it is still too early to say” how many aircraft the annual manufacturing target will be set.

Due to the vicissitudes of the program, the factory has not yet reached its full production rate.

Airbus SE also announced a reduction in production of its slow-selling A380 superjumbo, casting further doubt over the flagship program’s future. It warned that engine malfunctions are still weighing on deliveries of the single-aisle A320 that’s due to become its largest-volume model.

The A380 build rate will be reduced to eight jets a year in 2019, down from 15 this year and 28 in 2016, Airbus said on Wednesday. While the company aims to eke out the backlog in anticipation of revived demand as airports get busier, it said the handful of ongoing contract negotiations may not produce sales.

“Even if we should get another order before the end of the year, that will not change the needle on our rate decision, except if we would get an unexpectedly high order," CEO Tom Enders said.