February 1, 2007

2007: A Critical Year for Airbus

By Thomas Lifson
If Queen Elizabeth II were to describe the year 2006 for Airbus, she would surely call it an annus horribilis. To recover its momentum in the civil airliner business it will have to overcome many serious challenges in 2007.  Customers, unions, governments, and its archrival Boeing all present pitfalls, and must be dealt with artfully for Airbus to regain its footing.The year that wasThe embarrassment of multiple delays in the scheduled delivery of its 380 super-jumbo jet was exacerbated by the serious financial consequences in terms of penalty payments and financial concessions to aggrieved airline customers. Suppliers have gone through the financial wringer, unable to deliver and get paid for components already booked, in-process or even manufactured. Instead of collecting cash upon delivery of A 380s, it is spending extra money in a feverish effort to move the metal.Airbus' next generation aircraft in the midsize range, the A350, was a critical bungle. Boeing correctly judged...(Read Full Article)