TLDR
- Airbus CEO Guillaume Faury identified engine procurement as the biggest supply chain obstacle affecting 2025 and 2026 production
- The European planemaker faces a growing backlog of undelivered aircraft despite continued strong customer demand
- Defense orders are accelerating as governments increase military budgets, potentially offsetting commercial delivery slowdowns
- Airbus is developing a new short-haul aircraft to replace the A320 family by decade’s end
- EADSF shares fell 1.39% to $230.60 following the CEO’s remarks at the World Governments Summit
Airbus CEO Guillaume Faury didn’t mince words when discussing the company’s supply chain troubles. Speaking at the World Governments Summit in Dubai on Tuesday, he called out engine shortages as the primary roadblock. EADSF stock dropped 1.39% to $230.60 on Monday.
The engine supply problem isn’t going away quickly. Faury confirmed these constraints will continue through both 2025 and 2026. Aircraft demand remains robust, but production can’t keep pace with orders.
This mismatch has created a substantial backlog of planes waiting for delivery. Customers are lined up, but Airbus can’t get the engines it needs. The situation highlights how one critical component can bottleneck an entire manufacturing operation.
Defense Business Picks Up Slack
There’s a silver lining in the defense sector. Faury reported accelerating demand for military products as governments boost defense spending. This revenue stream could help offset the impact of delayed commercial aircraft deliveries.
The timing works in Airbus’s favor. While commercial production struggles with supply constraints, the defense side is heating up. Government contracts are flowing as nations prioritize military capabilities.
Faury also weighed in on Chinese competition. Companies like Comac are entering the aircraft manufacturing space. The CEO said he takes these competitors seriously but believes the market can accommodate new players. Current demand levels leave room for multiple manufacturers.
New Aircraft Development Progresses
Airbus is moving forward with its next-generation short-haul aircraft. The company aims to launch a replacement for the A320 family before 2030 ends. The new plane should enter commercial service in the mid-2030s.
This timeline gives Airbus a long runway to address current supply issues. The new aircraft program represents a major investment in the company’s commercial aviation future.
Investors will get detailed financial updates on February 19 when Airbus reports fourth-quarter earnings. Analysts expect Q4 2025 revenues of $31.73 billion, representing 9% year-over-year growth. Earnings per share projections stand at $2.90, up 5% from Q4 2024.
Wall Street maintains a Moderate Buy rating on EADSF stock. Nine analysts recommend buying, while four suggest holding. The average price target sits at $269.77, implying 17% upside potential from current levels.
The supply chain challenges extend beyond Airbus alone. Engine manufacturers face their own constraints that ripple through the entire aerospace production chain. Faury’s comments underscore how interconnected these supply networks have become.
Chinese manufacturers like Comac represent a long-term competitive factor. Faury acknowledged their presence but emphasized the market’s capacity to support multiple players given current demand levels.
The backlog continues growing as new orders arrive faster than planes can be delivered. This represents both a problem and an opportunity for Airbus. Strong demand is positive, but unfilled orders don’t generate immediate revenue.
Faury made these remarks at the World Governments Summit in Dubai on Tuesday, providing investors with a candid assessment of the challenges facing the European aerospace manufacturer.
The post Airbus Stock: Engine Supply Crunch Hampers Delivery Schedule appeared first on Blockonomi.
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This articles is written by : Nermeen Nabil Khear Abdelmalak
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