Airbus SE suffered a one-two blow to its popular A320 plane after revealing a quality issue on some fuselage panels – just days after a software glitch on around 6,000 planes required emergency upgrades.
“Airbus is taking a conservative approach and inspecting all aircraft that may be affected – knowing that only some of them will require further action,” the company said in a statement, responding to an earlier Reuters report identifying the problem.
The European manufacturer appeared to have averted a major headache Monday morning when it said only a small portion of planes that needed the software fix still needed attention. But the disclosure of quality defects on a key part of the plane spooked investors again, sending shares down the most since April.
The company said the source of the latest problem has been identified and contained, and newly produced panels meet all requirements. Still, it is unclear how the additional inspections could affect Airbus’ tight aircraft delivery schedule for this year and how many aircraft will be affected.
Airbus delivered about 70 planes in November, according to people familiar with the figures, leaving the company with about 165 units available to customers in December, which would be a record.
The aircraft manufacturer has a target of 820 aircraft deliveries for the year, a feat that seems almost achievable if everything falls into place perfectly. Airbus averaged about 109 deliveries in December, with the record set in 2019 when it handed over 138 aircraft, according to RBC Capital Markets analyst Ken Herbert.
Airbus shares fell as much as 11% in Paris trading, marking their worst intraday decline since April 7. The company has long faced shortages of parts, from engines to kitchen units to toilets, which have held back production.
The A320 is by far the company’s most popular product. On Friday, Airbus called for an urgent software overhaul of more than half of its active A320 family fleet after an incident exposed possible corruption of flight controls due to solar radiation.
Given that Airbus has not issued a stock exchange notice changing its delivery guidance, the panel issue appears manageable, JPMorgan analysts David H Perry and Lucy Fitzgerald wrote in a note. The batch of defective panels is for the front of the plane, mounted behind the cockpit next to the two front doors, the analysts wrote, citing Airbus.
Aircraft deliveries are closely watched because they provide investors with clues about the health of a manufacturer’s supply chain and manufacturing processes. Airbus has been forced to revise its annual target in the past, but last year the company came within its target.
Photo: An Airbus A320 fuselage at the company’s factory in Toulouse, France; photo credit: Matthieu Rondel/Bloomberg
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