Airbus is exploring if and how it could raise production of its A320neo family to 75 aircraft per month in 2025 while also almost tripling output of the A220 to 14 aircraft over roughly the same period.
If implemented, the manufacturer would deliver almost 90 narrowbody aircraft per month by the middle of the decade, around twice as many as the current rate and would set new production records for both programs.
By contrast, widebody rates will hardly change in the short-to-medium term. The A330/A330neo program will stay at the current level of two aircraft per month, while the A350 rate is planned to increase from five to six by the fall of 2022.
“The aviation sector is beginning to recover from the COVID-19 crisis,” Airbus CEO Guillaume Faury said. The company assumes that the recovery will be led by the single-aisle sector while weakness in long-haul markets will persist.
The May 27 announcement was an update to inform Airbus’ suppliers of future production plans. It was not a formal decision to actually raise output to the described level. Those calls will partly be made at later stages.
However, Airbus did more formally commit to incremental steps up in production. First, the company confirmed an earlier target of raising A320neo family deliveries from the current level of 40 to 45 in the fourth quarter of 2021. That number is to increase to 64 per month in the second quarter of 2023. Airbus has also asked its suppliers to prepare for a rate of 70 by the first quarter of 2024.
On the A220 line, output is to increase from five to six per month early in 2022. Airbus is planning to go to 14 aircraft per month over the next few years, bringing that program close to financial break-even. The A320neo family program is currently the only profitable line in the Airbus portfolio.
“The message to our supplier community provides visibility to the entire industrial ecosystem to secure the necessary capabilities and be ready when market conditions call for it,” Faury said.
According to a recent Reuters report, Boeing is planning to raise 737 MAX production to 31 aircraft per month in early 2022 and to 42 in the fall of next year.
Airbus’ production plans fall in line with a rather optimistic outlook on the recovery of the air transport sector after the pandemic. “The effects in the long term may not be as bad as people fear,” IATA Chief Economist Brian Pearce said. The broader economy is following a V-shaped recovery, he observed. “There is pent-up demand for travel and there are savings to be spent.”
IATA anticipates a substantial recovery in the second half of 2021 with large domestic markets like China, the U.S. and Brazil moving first. “We see no reason why there should not be a strong rebound,” Pearce said.
The global airline body anticipates passenger numbers to rise to 88% of 2019 levels in 2022 and to 105% of pre-COVID numbers in 2023. Importantly, growth in revenue passenger kilometers (RPK) will be slower because the average flight sector length will be shorter. IATA forecasts a compound annual growth rate of 3.9% for passenger numbers until 2030 (mathematically a doubling every 19 years) and around 3% growth in RPKs. If the projections are accurate, the COVID-19 pandemic has cost the industry two years of growth until 2030.
Industrially, Airbus is preparing for the unprecedented rates in several ways. It inaugurated a fourth narrowbody assembly line in Hamburg in 2018, reflecting mainly the steep rise in demand for the A321neo. In Toulouse, another new A320/321neo line is to be ready by the end of 2022, replacing one of the legacy final assembly lines. Airbus narrowbodies are manufactured in Hamburg, Toulouse, Mobile, Alabama and Tianjin, China. A220 lines are in Mobile and Mirabel, Canada.
Airbus is also establishing its future production system, to be ready by 2025. The concept includes a mix of organizational and technology changes. The group plans to reshuffle its aerostructures operations by the end of 2021, enlarging affiliates Premium Aerotec and Stelia Aerospace while also moving them closer to the core of its activities by eliminating bureaucracy. Secondly, more automation is to be introduced not only in final assembly but also in aerostructures manufacturing. Airbus is also phasing in the concept of digital design, manufacturing and services (DDMS) which aims at digitizing not only production but the whole aircraft lifecycle where feasible.
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