“COVID-19” hits aviation industry: AIRBUS to drop aircraft production by 30%, another blow to aluminium industry

On 8^th April’20, Airbus, Europe’s largest manufacturer, has announced that it will drop aircraft production of its core three aircraft models by roughly a third.

The aircraft manufacturer has stated clearly that it will steeply cut production from the bestselling A320 single-aisle jet to 40 per month from 60 per month previously, assembled in Toulouse and Hamburg.

Airbus will also drop its production of the A330 to two a month and the A350 jet to six a month. The aerospace sector is a key consumer of aluminium. The worldwide demand for the light metal has been choked, with the COVID-19 epidemic spawning the utmost turmoil to supply chains, and the outcome of it is putting the global premiums down.

Guillaume Faury, CEO, Airbus said: “Our airline customers are heavily impacted by the COVID-19 crisis. We are actively adapting our production to their new situation and working on operational and financial mitigation measures to face reality.”

He also added: “The impact of this pandemic is unprecedented, At Airbus, protecting our people and supporting the fight against the virus are our chief priorities at this time.”

The company said: “With these new production rates, Airbus preserves its ability to meet customer demand while protecting its ability to further adapt as the global market evolves.”

In March’20 Airbus has supplied 36 aircraft across the multiple series of the jet family, whereas in February’20 it has delivered 55 aircraft. The plane manufacturer has already cancelled the orders in its backlog.

Airbus has generated revenue of $76 billion in 2019 and employed manpower of around 135,000. The company also supports 2500 firms in its supply chain.

The COVID-19 breakout has created a huge drop in international travel and it has been forcing the aerospace organisations to go out for radical restructure so that it can adapt the environment of the new market.

Boeing, the biggest competitor of Airbus, has already halted its operations indefinitely, due to the spread of the coronavirus, as per the government’s advice and supply chain reliability.

Howmet Aerospace - created in recently, came out from the separation of Arconic Inc. into two standalone companies - is also reducing costs and suspending its dividend in response to the halt of customer operations.