3 days Ago By Mia Ping-Chieh Chen
Airbus could be forced to revise its annual delivery target once again as the European plane maker battles to clear a growing backlog of aircraft. Despite delivering 62 jets in October , the company's year-to-date total now stands at 559 aircraft. This leaves it with a delivery backlog of over 200 aircraft to reach its revised 2024 goal of around 770 units, a target already lowered from 800 in July due to persistent supply chain issues.
Backlog grows as supply chain challenges continue With just two months remaining in the year, analysts are growing increasingly doubtful that Airbus will be able to meet even the lower-end target without further delays. The company would need to almost double its current monthly delivery pace in order to hit the 770 mark, a tall order given ongoing challenges in sourcing key components and completing production. The 62 deliveries in October were a step forward, but the backlog of planes that Airbus needs to clear before year-end is still formidable.
Airbus needs to deliver an additional 211 aircraft in the final two months of 2024 to hit its revised target. This represents a significant ramp-up from the 60-70 aircraft delivered each month in recent months, and analysts have expressed concern that Airbus will struggle to meet this demand given the current state of the supply chain. Analysts aren't optimistic Sash Tusa, an analyst at Agency Partners told Reuters : "While it is clearly possible that Airbus might pull something out of the bag .
.. it is increasingly feeling to us as though 750 deliveries, the bottom end of Airbus’s new range, would be a good result," Tusa noted, "We would not rule out another guidance cut towards the end of November if management sees no signs of improvement by then.
" Supply chain disruptions, including shortages of engines and cabin components, have plagued Airbus throughout the year. These issues have particularly affected its best-selling Airbus A320neo family, slowing production and preventing the company from hitting its earlier target of producing 75 A320neo aircraft per month. That target has now been delayed until 2027, with Airbus acknowledging that its suppliers are still struggling to meet the demand.
Given the slow pace of deliveries and continued supply chain issues, there is growing speculation that Airbus may have to revise its 2024 delivery target once again. Some analysts are now forecasting that the company could end up delivering as few as 750 aircraft this year, which would mark a significant shortfall compared to its original projection. Race against the clock Just a week ago, Airbus reaffirmed its commitment to delivering 770 aircraft in 2024, despite the ongoing supply-chain hurdles that have posed significant challenges for the aviation giant.
The announcement came as the company reported third-quarter adjusted earnings before interest and taxes (EBIT) of €1.41 billion, exceeding analysts' expectations of €1.21 billion.
The strong earnings result, driven by solid demand for aircraft and ongoing efficiency improvements, has helped to sustain investor confidence amid the supply chain struggles. The manufacturer recently revised its delivery forecast for this year. However, with the delivery backlog continuing to stretch beyond 200 aircraft, the company’s ability to hit its revised target remains uncertain.
While Airbus has made progress in clearing some of its delivery delays, the company’s final push in the closing months of 2024 will require a monumental effort to ramp up production and address ongoing bottlenecks. The strong third-quarter earnings reflect the resilience of the business, but the delivery target may still be a bridge too far unless Airbus can dramatically accelerate its output..
