Airbus preparing for record A320 production rates?

Skycolors /

Airbus, which had reached record aircraft production levels in 2019, is reportedly looking to ramp up production of its Airbus A320 aircraft family and break its own record of the monthly aircraft rate in the coming years.

The Toulouse-based manufacturer reached a record-breaking production rate for the Airbus A320 family of 60 per month in 2019. In February 2020, when Airbus presented its FY2019 results, the company indicated that it had finalized work to ramp-up the rate to 63 per month by 2021. Not long before, the coronavirus crisis struck and Airbus, like many others, was forced to adapt to the current market situation.

Now, the planemaker looks to the future – and the future will once again bring back record-breaking production levels at various Final Assembly Lines (FAL) of Airbus’ supply chain.

Slowing down

In April 2020, Airbus announced that rates for the A320 family would go down from 60 to 40 per month for the time being. The company was looking to preserve “its ability to meet customer demand while protecting its ability to further adapt as the global market evolves,” was cited as the reason for the output cut.

Two months later, the situation had not improved, as Airbus Chief Executive Officer (CEO) Guillaume Faury stated that Airbus assumed that production levels seen in 2019 would not return by 2025.

The manufacturer coasted through 2020 with 40 Airbus A320 family aircraft per month, finishing the year off with a total of 556 deliveries, which included 446 narrow-body jets, excluding the A220. 

Now, the manufacturer is looking to surf the recovery, in particular with the A320. According to a report by La Tribune, Airbus looks to produce as much as 47 A320s by July 2021. The ramp-up would continue throughout the next three years: by January 2022, the monthly output would reach 51 aircraft, six months later it would be at 57 per month, and by January 2023, Airbus would churn out 61 A320 family aircraft within a month.

While the outlook has recently improved due to the vaccination effort that has begun across the world, it was also slowed down due to new strains of the virus discovered in Brazil, the United Kingdom and South Africa. Thus, the planned ramp-up rates could once again shift, as Airbus monitors the situation across the globe.

Signs of eventual ramp-up

Despite the crisis that has ravaged air travel throughout the year, signs that Airbus was looking to ramp-up production were there.

The planemaker introduced its third BelugaXL aircraft into service in October 2020. The aircraft, which has been specifically built to carry various aircraft parts across Airbus’ assembly lines in China, Europe and North America, will replace the A300-based Beluga. Up to six BelugaXLs, which is based on the A330, will enter service by 2023.

In addition, the manufacturer will build a mega warehouse that will have 45,000 square meters of floor space, equivalent to six football (or soccer, for those who follow the wrong sport) fields in Hamburg, Germany, according to a report by Die Welt. Following the opening of the warehouse, which is scheduled for July 2021, Airbus will handle the storage and production logistics. Furthermore, the planemaker plans to independently control part supply for the A320 cabin equipment in Hamburg.

The Hamburg FAL previously struggled to deliver aircraft on time, as the Airbus Cabin Flex (ACF) option, which allows for more individual cabin configuration, hit production issues. Disappointment followed – so much so, that International Airlines Group (IAG) (IAG) signed a Letter of Intent (LoI) with Boeing for 200 737 MAX aircraft in July 2019. Willie Walsh, the now-retired IAG chief executive, indicated that A320neo aircraft were delivered up to 70 days late on average, which prompted the airline group to look across the Atlantic for other options.

“This should be an indication not just to Airbus but to everybody that we’re unhappy with their performance. I know everybody interprets it as an issue of price, it’s not,” Walsh stated at the time.

Nevertheless, the new warehouse in Germany’s north would allow Airbus to control the production with “foresight,” Sebastian Peters, head of Logistics and Industrial Planning at the manufacturer, told Die Welt. “If a part comes later or there is a quality problem, we can intervene at the right time,” Peters added.

Supporting backlog?

By a long stretch, the A320 is Airbus most popular product. Similar to the competing Boeing 737 MAX, the narrow-body segment has always remained in high-demand. But has that demand remained robust enough to warrant a hike in production rates?

The European planemaker indicated in its 2020 Orders and Deliveries release that it received 268 net orders after 115 aircraft were removed from the backlog due to cancellations. Airbus reduced its A320 backlog by 33 aircraft, namely 22 A320neos and 11 A321neos, as customers backed away or minimized their orders. Despite the fact, the order book increased by 75 and 141 units, respectively. According to the Orders and Deliveries data as of December 30, 2020, Airbus had a backlog of 5,885 aircraft of the A320 family.

The backlog is no doubt in a healthier state compared to the 737 MAX, which saw its backlog shrink by around 1,000 aircraft compared to the end of 2019. 

However, some of the airlines might not see the light of the day or be able to take up the ordered aircraft. While only a handful of airlines have been liquidated throughout the downturn in travel, a balloon of debt hangs over the numerous parked aircraft.

”Debt has gone up more than 50%. Airlines have to generate positive cash to pay that down. $220 billion of extra debt is going to take years to repay,” International Air Transport Association (IATA)’s chief economist Brian Pearce stated in November 2020. Pearce added that the ever-increasing debt levels would result in fewer resources to invest in new aircraft, slowing down expansion and fleet renewal plans.

At the same time, the robust demand for narrow-body aircraft is predicted to remain, as domestic and regional aviation is better positioned to weather such crises as the current COVID-19-induced one. International travel has suffered the most due to the unpredictable nature of borders being either open or closed.

“Operators are projected to need 32,270 new airplanes in the next 20 years. Single-aisle demand will recover sooner due to its key role in short-haul routes and domestic markets as well as passenger preference for point-to-point service,” concluded Boeing in its most recent 20-year market outlook, published in October 2020.


Related Posts


Stay updated on aviation and aerospace - subscribe to our newsletter!