Airbus CEO Guillaume Faury on Q2 Earnings, Supply Chain Issues, and Order Backlog

Q2 Earnings and Cash Flow

• 💡 Airbus reported a negative free cash flow in the first half of the year, primarily due to missing engine deliveries.
• 📌 A significant number of finished aircraft, referred to as "gliders," are on the ground awaiting engines, impacting delivery numbers.
• ✅ Despite these challenges, Airbus has confirmed its guidance for the year, expecting to resolve engine supply issues.

Supply Chain and Engine Delays

• ⚙️ Delays are attributed to short-term industrial challenges and supply chain holdups, not labor issues.
• ⚠️ GE faced industrial difficulties with engine core production, and a strike at Safran further impacted engine deliveries.
• 🚀 Both CFM and Pratt & Whitney are expected to recover engine deliveries by the end of the year, returning Airbus to normal operations.

Demand and Order Backlog

• 📈 Airbus is experiencing very high overall demand, with more orders than its current supply capacity.
• 🌟 The company holds the largest backlog in the industry, which continues to grow, indicating strong future business.
• 🚀 Airbus plans to ramp up production of the A320 family to a monthly rate of 75 aircraft by 2027, the highest ever for a commercial aircraft.

Trade Deal Impact

• ✈️ Airbus welcomes the recent agreement between the US and EU to return civil aviation to a "zero for zero" tariff framework.
• ⏱️ The company hopes this agreement will be implemented as soon as possible, ideally within weeks, to ensure normal operations.
• 🤝 The absence of tariffs has historically driven the success of the aviation industry.