Exclusive-Airbus delays some 2024 deliveries, keeps output goals

By Tim Hepher

PARIS (Reuters) - Airbus has started notifying airlines about delivery delays in 2024 for its best-selling A320neo family of jets, with several hundred of the single-aisle planes set to be postponed by as much as three months, industry sources said on Tuesday.

Airbus confirmed unspecified delays for 2024 in a statement to Reuters but said they did not reflect any worsening of supply chain problems since it revised production plans earlier this year. It reaffirmed production targets for 2024 and beyond.

"We already communicated in December on the impact for 2023 and are now talking about 2024 in detail," Airbus said by email.

For airlines, the latest wave of notices marks the first concrete indication of supply constraints beyond this year.

The delays particularly affect the larger and in-demand A321neo variant, which now represents over half of Airbus deliveries, the sources said.

Airlines and leasing companies have protested in recent months over a trickle of short-term delay notices amid ongoing supply chain problems. Airbus is now giving more advance notice.

"We try to be as transparent as possible to provide visibility for our customers," an Airbus spokesperson said.

Two airline industry sources said they were still struggling to find the clarity needed for network planning, however. "We are still being drip-fed," one of the sources said, adding the delays suggested supply chains were not significantly improving.

The delays do not so far include alterations to the schedule for 2023, which has already been trimmed back to target 720 deliveries, unchanged from an initial target for last year.Analysts say the jury is still out on whether Airbus will hit that target after a weak first quarter. Wide-body plane deliveries are seen under the most pressure.

PENALTIES DEBATE

Aerospace and other manufacturers are feeling widespread pressure from bottlenecks in supply chains. By contrast, Airbus and Boeing (NYSE:BA) are confident demand for new jets remains robust. Airbus is currently the world's largest planemaker as Boeing slowly recovers from the 737 MAX safety crisis and production delays on the 787. Boeing announceda fresh supplier-related halt to 737 deliveries last week. But in the first quarter, Airbus deliveries fell below Boeing's for the first time on a quarterly basis since it took over the CSeries passenger jet from Canada's Bombardier in 2018 and added it to its portfolio as the A220. The delays for 2024 extend the impact of supply chain problems stemming from the COVID-19 outbreak into a fifth year.

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That could rekindle arguments over whether airlines should be compensated, the sources said. For now, planemakers are mostly holding to the position that supplier-related delays are "excusable" in contractual terms, meaning buyers are not owed penalties.

But this year pressure has been growing on planemakers to start paying penalties and stop the clock on inflation-adjustment clauses. "If you have spent years telling everyone that your core value lies in being an integrator, then at some point you have to start owning the problems of your own supply chain," a person involved in discussions with planemakers told Reuters. Airbus and Boeing have defended themselves over delivery delays, with a Boeing executive telling the Airline Economics conference in Dublin in January that increasing production after COVID-19 lockdowns was "not as easy as an on/off switch."