Wednesday, October 20, 2021

Pandemic clips plane-maker rivals’ wings as both see profits plummet

But both companies are optimistic as they rebuild to come out flying on 'the other side of the pandemic'.

Other News

Nobody is having the best year but the world’s largest aircraft manufacturers, Airbus and Boeing, are both having a nightmare 2020 as their current financial reports are revealing.

European plane manufacturer Airbus has reported a loss of €641 million (RM3,000 million) for the first nine months of this financial year, down from a profit of €3,593 million (RM17,000 million) in 2019.

The plunge into negative earnings was caused by reduced aircraft deliveries in the pandemic, with around 40% fewer deliveries year-on-year amid a slower-than-expected recovery in air travel, said an Airbus statement.

CEO Guillaume Faury said Airbus has already adapted its operations to cope with the virus and is not predicting major disruptions from new restrictions, notably lockdowns announced in France and Germany this week.

“We will have to live with the circulation of the virus for a long period of time,” he said. “Yes, it’s making our life a bit more difficult, but these kind of measures – which by the way, are necessary – are part of what we have to deal with.”

He expressed concern about struggling Airbus suppliers, telling reporters, “We are very vigilant to make sure we navigate the situation all together, so that we all stay alive to be able to get to the other side of the pandemic.”

Rival Boeing earlier reported losses of US$466 million (RM1,940 million) for the third quarter. It has confirmed it will cut a further 7,000 jobs as losses from the Covid-19 pandemic continue to mount.

The US manufacturer, which had already announced deep cuts, said staff numbers would be down to 130,000 by the end of next year. This means the company will have 20% fewer employees going into 2021 than the 160,000 it had before the crisis.

Boeing said safety concerns about its 737 Max jet have also contributed to a slump in orders since two fatal crashes caused all aircraft of that model to be grounded in March 2019. The company claims to have made steady progress toward the safe return to service of the 737 Max, including rigorous certification and validation flights conducted by global aviation safety bodies.

“The global pandemic continued to add pressure to our business this quarter,” said Boeing chief executive, Dave Calhoun. “Our government services, defence and space programmes, continue to provide some stability for us as we adapt and rebuild for the other side of the pandemic.”

Follow us on Telegram for the latest updates:

Subscribe to our newsletter

To be updated with all the latest news and analyses.

Related Articles