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The company sees demand for more than 43,000 passenger and freighter aircraft between 2025 and 2044
Airbus will increase shareholder returns, raising its dividend payout ratio to 30%-50% amid robust aircraft demand.
Airbus said it would increase shareholder returns in the coming years, betting that robust demand for aircraft will continue to fuel growth.
The European plane maker said Wednesday that it was lifting its dividend payout ratio to between 30% and 50% from a current range of 30% to 40%. The company said special dividends and share buybacks remained on the table to return extra cash to shareholders.
The move shows a growing divide between Airbus and Boeing, which suspended dividend payments in March 2020. Airbus’s beleaguered rival has been mired in safety and production issues in recent years and is working to recover from the reputational and financial fallout.
Airbus shares rose more than 3% following the announcement that came during the Paris Air Show. The company bagged several aircraft orders at the annual trade event, underscoring strong demand for planes as airlines continue to expand capacity.
Airbus anticipates global demand for more than 43,000 passenger and freighter aircraft between 2025 and 2044, saying single-aisle planes would account for the bulk of new passenger-aircraft demand over the next two decades.
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Airbus said it won’t be meeting its annual targets for the year, including the number of commercial aircraft it planned to deliver, after its space-systems management team identified further commercial and technical challenges.
The European plane maker on Monday said that it will also book charges of about €900 million ($962.5 million) in the first half of 2024 following an extensive review of its space-systems programs.
Airbus expects to end the year delivering 770 commercial aircraft, down from a prior outlook of 800 commercial aircraft deliveries a couple of months ago.
The company said its A320 ramp-up trajectory has been adjusted to reflect specific supply-chain challenges in a degraded operating environment, and that its target production rate of 75 A320 Family aircraft a month is now set to be reached a year later, in 2027.
Airbus also forecasts adjusted earnings before interest and taxes of about €5.5 billion, below the €6.5 billion to €7 billion expected previously.
Airbus’s free cash flow before customer financing expectations have also been lowered to €3.5 billion from €4 billion, the company said.
The first-half expenses are mainly related to updated assumptions on schedules, workload, sourcing, risks and costs over the lifetime of certain telecommunications, navigation and observation programs, Airbus said.
Airbus’ first-half results are set to be published on July 30.
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Airbus will pay Spirit $439M for the sites and provide $200M in credit lines. Airbus agreed to acquire some Spirit AeroSystems facilities that make parts for its jets, moving to take direct control of production in a bid to stabilize supply chains after months of disruption.
The companies said Monday that they had entered into a definitive deal for Airbus to take over several of Spirit’s plants in the U.S., Europe and Africa that produce fuselage sections and other components for Airbus’s commercial aircraft.
Spirit, which split off from Boeing BA 3.18%increase; green up pointing triangle about two decades ago, has been at the center of quality issues affecting 737 MAX jets. Spirit made the fuselage involved in last year’s Alaska Airlines emergency landing.
The deal with Airbus comes months after U.S. rival Boeing struck a roughly $4.7 billion agreement to acquire the Kansas-based jet-parts maker, including most Boeing-related commercial operations as well as additional commercial, defense and aftermarket operations.
Airbus Chief Executive Guillaume Faury told shareholders at the company’s annual general meeting earlier this month that supply-chain hurdles, particularly with Spirit, were putting pressure on plans to ramp up production of its A220 narrow-body and A350 wide-body aircraft. Airbus was forced to delay the entry into service of the A350 freighter variant to the second half of 2027 from 2026 previously.
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Exits could complicate regulatory and air-traffic-control work, internal presentation says
Resignations and retirements are building across the agency, potentially affecting divisions that oversee everything from air traffic to legal matters and space launches, according to FAA documents and people close to the discussions.
The departures could complicate regulatory and air-traffic control work handled by the FAA. The agency is under scrutiny after January’s deadly midair collision in the Washington, D.C., area and a series of technology failures that have disrupted air travel.
“Employees are departing the agency in mass quantities across all skill levels,” according to a May 7 internal presentation to senior FAA management, outlining the effects of what is known as a deferred-resignation program.
The presentation, which was viewed by The Wall Street Journal, flagged departures of senior leaders, technical experts and mission-support employees that it said would result in losing critical competencies and institutional knowledge. A similar presentation by the agency’s human-resources staff tallied more than 1,200 employees who were departing under the program.
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Boom Supersonic CEO Blake Scholl wants to bring back flights that break the sound barrier. Now he just needs to figure out whether airlines and travelers will buy in.
When the Concorde was grounded in 2003, done in by strained economics and a fiery crash on a Paris runway, it appeared to be the end of the line for supersonic travel. Nothing emerged to replace it. In fact, the speed of air travel moved in the opposite direction, with many routes getting slower in recent years as congestion and air-traffic control inefficiencies jammed up the skies.
A former Amazon software engineer named Blake Scholl founded a company to change this. A decade ago, he launched Boom Supersonic, betting that his Denver-based startup could tap in to the allure of ultrafast travel—a desire that has never quite been extinguished despite the financial and practical challenges that ended the Concorde’s nearly 30-year run. Scholl sees a world where round-trip trans-Atlantic business journeys happen in a single day.
“The thinking has been, ‘Supersonic flight would obviously be great, but nobody is doing it so therefore it must be impossible,’ ” the 44-year-old chief executive said during a recent interview. “Not true.”
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Boeing CEO Kelly Ortberg said the expected impact of tariffs on the jet maker’s bottom line remains unchanged after a federal court struck down many of President Trump's trade levies. Ortberg, speaking Thursday at an event, said he expects the U.S. to eventually win duty exemptions on plane parts from Italy and Japan, which comprise the bulk of Boeing’s imported parts. The U.S. has reached a trade deal framework with the U.K.
Given that, Ortberg said, the biggest tariff-related threat facing Boeing remains retaliatory tariffs from other governments. The company got caught in the crosshairs of the U.S.-China trade war last month when Chinese airlines halted deliveries of Boeing jets. China has since allowed deliveries to resume. Ortberg said that Chinese airlines have told the company they will resume taking deliveries of Boeing jets next month.
“We have to make sure we don’t have other regions where we take retaliatory tariffs,” he said. Boeing’s status as the largest U.S. exporter also presents an opportunity, he said, as the Trump administration pushes nations to rebalance trade relationships. “There is no better way to do that quickly than through the purchase of aircraft,” he said. Boeing has said it expects U.S. import tariffs to cost the company less than $500 million this year.
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Boeing also admitted to conspiracy to obstruct Federal Aviation Administration operations Boeing will pay $1.1 billion to avoid prosecution for two crashes of its 737 MAX jets. The agreement with the Justice Department requires the company to put $455 million toward strengthening its compliance, safety and quality programs, according to a Securities and Exchange Commission filing on Wednesday. Boeing will also give $444.5 million to the families of crash victims under the agreement, which was tentatively reached last month. Boeing is required to pay a criminal monetary penalty of $487.2 million, half of which was paid in 2021 under a previous agreement. The new deal means Boeing avoids a trial that was scheduled to start June 23 in connection with the two crashes, which left 346 people dead.
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The jet maker said it could deliver more planes this quarter than previously forecast. Boeing's chief financial officer said the jet maker was on track to deliver more planes and burn less cash this quarter than previously expected, boosting its stock early Wednesday.
“We think we’re off to a good start for the year,” Chief Financial Officer Brian West said at an investor conference.
Boeing burned through nearly $14 billion last year as it waded through a quality-control crisis and other snafus, and previously said it expected to add $4 billion to that tally this quarter.
But West said Wednesday the company may burn hundreds of millions of dollars less than anticipated.
He also said jet deliveries could be higher than previously expected. Boeing delivered 89 planes in January and February, up from 54 in the first two months of 2024 immediately following the Alaska Airlines fuselage panel blowout.
Boeing shares rose more than 6% in morning trading following West's comments.
West said the company wasn't sweating the potential financial fallout from tariffs at this point.
The vast majority of parts for Boeing’s commercial and military jets and other equipment comes from the U.S., and the company has an extensive parts backlog after production was slowed or shut down for much of last year.
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