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Rearrangement in A320-Family

Airbus considering A321 Neo production ramp-up

The A321 Neo deliveries are posing problems for Airbus. The aircraft manufacturer now wants to increase the share of the aircraft in the A320 Family's production capacity.

Airbus

Airbus A321 Neo: The demand remains high.

Jetblue boss Robin Hayes said last week that he was «very disappointed» by Airbus. The European aircraft manufacturer recently reported further delays with the A321 Neo, the US airline said. Due to production problems at Airbus, a maximum of six A321 Neo aircraft will be delivered in the current year instead of 13 as planned.

The problem does not seem to be an isolated one, as Airbus is considering strengthening A321 production within the A320 Family. «The ramp-up in production of the ACF (Airbus Cabin Flex) version of the A321 remains challenging,» the manufacturer writes in its half-yearly figures on Wednesday (31 July). «Given the recent commercial success of the A321 ACF and XLR as demonstrated at Le Bourget, Airbus is studying different options to increase the share of the A321 in current A320 Family production capacity.»

Where would the proportion decrease?

Cabin Flex is a new variant first delivered by Airbus in September 2018. It has a different aft section and a different door layout. Cabin Flex is initially an option for the A321 Neo but should become the standard from 2020 on. The variant is also the base for the long-distance version A321 LR. Airbus unveiled the A321 XLR, which can fly even further, at the Paris Airshow in June and directly collected orders and letters of intent for a grand total of 229 aircraft, 87 of which were conversions from existing orders. In addition, there were options for a further 49 aircraft.

At the end of May, the Reuters news agency had already reported that Airbus was relocating workers from other locations to Hamburg due to a lack of personnel. The reason was the Airbus A321 and especially the long-haul version A321 LR. «The long-haul variant has a three-class seating layout,» an informant from trade union circles told Reuters. This requires more work. «Management has miscalculated the number of hours needed for the aircraft.»

Complications also with the A320 Neo

It is now unclear: If Airbus increases the proportion of the A321 in the production capacity of the A320 Family, where will the proportion decrease? At the end of June, Airbus had open orders from the family for eight A319s, 35 A319 Neo, 36 A320 and 61 A321. Even if Airbus were to put all these aircraft on hold, the A321 Neo production would only make limited progress. The figures for the Airbus A320 Neo, on the other hand, are quite different, with open orders for as many as 3238 aircraft.

But therefore Airbus is also lagging behind with deliveries of the A320 Neo. It was only on Tuesday that the leasing company BOC Aviation announced that it was not expecting seven Airbus A320 Neo aircraft scheduled for 2019 until 2020 due to «industrial restrictions» with the manufacturer. Airbus’ delays with the A320 Neo have been dragging on for some time and have also had to do with the engine manufacturers. But it is possible that the imminent delays on the A321 Neo are now more serious than on the A320 Neo.

High profit, difficult deliveries

On the other hand, the high demand brings Airbus good revenues. The manufacturer delivered 389 commercial aircraft in the first half of 2019, up from 303 in the first half of 2018. Adjusted Group earnings before interest and taxes rose to 2.53 billion euros from 1.16 billion euros in the same period of the previous year. «The half-year financial performance mainly reflects the ramp-up in production of A320 Family aircraft and transition to the more efficient Neo version, as well as further progress on the A350 financial performance,» said Airbus CEO Guillaume Faury.

However, Airbus admits that the second half of the year remains a challenge in terms of deliveries. On the A330 too, the aircraft manufacturer expresses caution: «On the A330 programme, the focus is on the ramp-up of the NEO version to secure deliveries in the second half of 2019». Positive news was delivered on the A350 programme, however. «Good progress was made on A350 recurring cost convergence and the programme is on track to reach the breakeven target for the year,» writes Airbus.

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