Airbus CEO strikes more upbeat note on CFM engine supplies

By Tim Hepher

BRUSSELS (Reuters) -Airbus CEO Guillaume Faury said on Tuesday that it could potentially ease an engine supply bottleneck and meet year-end targets, telling Reuters that CFM International should be able to supply enough units but it would be “very tight”.

A shortfall in engine supplies from CFM, co-owned by GE Aerospace and Safran (EPA:), has been partly blamed for sluggish Airbus jet deliveries since the summer.

That leaves the planemaker with around 200 jets to deliver in the last two months to reach a 2024 goal of “around” 770 jets – a task some analysts say looks increasingly out of reach.

Asked whether CFM was able to release enough engines to Airbus to support the planemaker’s end-year goals, Faury said: “In the short term it is very tight … I will only know for sure at the end of November”.

He added: “It should be ok; I don’t know yet. It will be within a few engines – not tens of engines – if any.”

CFM, which had no immediate comment, is one of two suppliers for the narrowbody A320neo family, Airbus’s best-selling jet. It competes with RTX unit Pratt & Whitney, which has also had various setbacks.

Like other engine makers, CFM has been having to juggle between competing demands for engines for new jet production and the global repair shops that keep existing planes in service, while also trying to prop up a weak supply chain.

The tussle led to visible tensions between Airbus and the industry’s largest engine supplier over the summer, when Airbus lowered its 2024 delivery target to “around” 770 jets from 800, citing supply problems at CFM as well as makers of other parts.

But speaking to Reuters on the sidelines of an industry event in Brussels on Tuesday, Faury struck a more relaxed note and noted that things had not been made easier on the supply chain by the impact of the recent Hurricane Milton.

“They (CFM) are serving us reasonably well given those circumstances,” he said.

Airbus delivered 62 jets in October to bring the total in the first 10 months of the year to 559.

Some analysts have said Airbus could have to cut its guidance again around the end of November if the situation does not improve. Airbus is widely expected to take advantage of flexibility in the wording of its target to justify deliveries as low as 750 without making any formal new downgrade.

Airbus, which is out-producing Boeing (NYSE:) as its U.S. rival slowly emerges from an internal crisis, is banking on deliveries of engines as well as other parts like seats and landing gear to pull off another last-minute surge in deliveries this year.

But analysts caution it must do so with a supply chain that has been weakened by the pandemic and shortages of parts and labour, meaning its industrial targets remain on a knife-edge.