Airbus reports loss of €1bn after Covid, and could shed 15,000 jobs

Aircraft maker says ‘pandemic continues to impact lives, economies and societies’

Airbus plummeted to a loss of more than €1bn last year and will continue to withhold shareholder payouts after deliveries of its aircraft fell by a third.

The European aerospace giant warned aircraft would remain under pressure in the year ahead amid a “volatile environment” created by the coronavirus pandemic.

Airbus delivered 566 commercial aircraft in 2020, down sharply from 863 the year before, and expects to deliver the same number in 2021.

The company warned last summer that it would face the “gravest crisis” in its history due to the pandemic, and planned to cut as many as 15,000 jobs, including 1,700 in the UK.

The slowdown in aircraft deliveries caused revenues at Airbus to fall by 27% to €49.9bn (£42.4bn) last year, leading to a net loss of €1.13bn for 2020. The gloomy financial result follows a €1.36bn loss in 2019 after the company was forced to pay a record £3bn in penalties for paying bribes on an “endemic” basis to land contracts in 20 countries.

Announcing Airbus’s annual results on Thursday, Guillaume Faury, the chief executive, said many uncertainties remained for the industry as “the pandemic continues to impact lives, economies and societies”. He said he hoped the company’s guidance would “provide some visibility in a volatile environment”.

But Peter McNally, an industry expert at research firm Third Bridge, said the outlook for 2021 could “prove disappointing to some investors”.

“Commercial airlines are off to a difficult start in 2021 and the outlook from Airbus reflects that,” he said. “The situation could improve as vaccines are more widely distributed, but Airbus executives note most of their customer base will be burning cash most of this year.”

Shares in Airbus fell 2.8% to €91.29 on Thursday.

The coronavirus has wreaked havoc on the travel and aircraft industries following severe restrictions to limit its spread.

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“The bright side is that leisure travel has been the area that has started its recovery first, and the Airbus order book is geared for that eventual uptick with their A320 fleet,” McNally said.

According to aerospace and defence lobby group ADS more than a 10th of the jobs in the UK’s aerospace industry could be cut as the plane manufacturers Airbus and Boeing and their suppliers adjust to lower demand.

A large number of those job losses will come from Airbus and the engine manufacturer Rolls-Royce, which are both making thousands of redundancies. The difficult year for the aerospace sector is also expected to hit smaller supply chain workers.


Jillian Ambrose

The GuardianTramp

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