Airbus Perceives a Recovery in Airline Market

"It's encouraging to see signs of recovery, in particular here in Asia," says Airbus CEO Noel Forgeard. "There's clearly an improvement in loads, and some airlines are re-introducing frequencies and destinations."

Chief commercial officer John Leahy compares the recovery with that of the Gulf War. "It's a similar scenario. Then, all the pundits were saying that it was different, that the airline industry wouldn't come back. But we're seeing an equally significant and quick recovery.

"First the traffic comes back, then the yields come back," Leahy says.

Airbus has reduced 2002 production to 300 aircraft, compared with 400 projected prior to September 11. "That was a product of negotiations with customers, including requests for postponements," Forgeard says. "We still have a few such negotiations, but they are marginal." Airbus will re-assess plans for 2003 at the end of the second quarter, but expects to maintain production at about 300 units.

Leahy expects airlines to place 400 orders for aircraft of more than 100 seats in 2002, offset by some 100 cancellations and deferments. Airbus' goal remains to win half those orders.

Restructured into a single entity with direct employees, Airbus can be compared directly with Boeing, says Forgeard. "Boeing laid off 30 per cent of its employees," he says. "We did not. Why? For a very simple reason. Even after the layoffs, Boeing employs 35 per cent more people than Airbus to produce the same number of aircraft."

A priority for Airbus this year is to break into Boeing's fortress market in Japan. "This will include significant industrial participation, for the first time," says Forgeard, who expects that Airbus and Japanese industry will announce some work-sharing agreements on the A380 in the near future.