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Let's talk about Airbus shares just barely finishing the day in the green. That's after they reported third quarter adjusted EVA that beat estimates. But it's not all good news. The CEO also sounding the warning bell that Airbus deliveries remain very backloaded. I'm pleased to say that that CEO joins us now. His name is Gium Fory. He is the CEO of Airbus Gium. Great to have you with us.
Let's talk about this target. You say that you're sticking to the target to deliver eight hundred and twenty aircraft to customers this year. You've only delivered about five hundred and seven through September.
So what gives you the.
Confidence that you'll be able to hit those numbers come the end of twenty twenty five?
And the fact that we are fully prepared and that we're already close to end of October, and the fact that the one of the reasons for being backloaded is the likeability of engines for our single aisle. We were with sixty gliders media we closed the third quarter in down to thirty two gliders, and we think we're going to have the engines. We need to deliver those planes before the end of the year, so it's indeed a lot of work in the last quarter of the year.
But we think we have the ingredients.
We're prepared to come close to the eightal and twenty deliveries.
We have guided form.
And would you say that the engines are still your biggest bottleneck at this moment? You mentioned the gliders for example. I know you had to park some ready made planes because of that engine issue, So is that the biggest issue? Would you say when it comes to the state of your supply chain.
The majority of what we're delivering are the A three twenty familiar aircraft, and indeed for those aircraft, the main bottleneck is the engine. Is the engine availability from both CFM and PRAT. We were with a very difficult situation at MEDIAIR. Things are improving. We think we're going to reach our numbers, as I said before for twenty twenty five, but we will have persisting tensions on availability of engine in twenty six and maybe in twenty seven as well.
I am curious though, Gil. I mean, we've heard from a lot of the major airline executives that have raised some concerns here about the backlog, in addition to just the general problems in getting those engines onto those gliders. There's now, at least here in the United States, the issue of a government shutdown that of course effectively brings to a halt or at least a slowdown and any sort of certification. Here have you had to address that at all so far, not.
To a major extent. We are not significantly exposed to this situation. Again, the main challenges we have are really on the delivery of aircraft, not on the certification of them. We have recently certified, I mean last year, the ecceler that's behind us, and the Acceller the eight three twenty one ECCELERA is a great airplane is now in service. That's behind us. And the next certification moving forward will be for the E three fifty fraighter. But that's not
today a short term bottleneck. We have to start flying with the aircraft. That will be the case in twenty twenty six, so certification is for later. We planned into service in twenty twenty seven, so we hope that in the meantime we will be able to restart or to have appropriate and efficient certification. Work with the FAA the primary certification authority is YASA, and we're currently working with the YASA for preparing the certification file of the three fifty Fraser.
With regards to your operations here in the United States, whether it has to do with the certification, whether it has to do with the shutdown or the broader issues, what are the deliveries. The timeline for delivery is coming out of the plant in Alabama.
Well, Alabama is one of our production sites.
You know that for the eight three twenty family, we are now relying on Mobile in the US in Alabama, in Toulouse and Hamburg in Europe, and on changing in
China for a mobile. We have recently inaugurated the second final assembly line for the three twenty, so we are clearly ramping up proportionally more in the US than in the rest of the world, and we have an eight to twenty final assembly line, so Mobile Alabama will soon become the fourth largest production site of commercial aircraft in the world, and it's another site in the US.
But basically we're jumping up eight three.
Twenty globally towards the Red seventy five, and Mobile Alabama will take each.
Air And you mentioned the A to twenty. When it comes to your production target, you actually lowered that as well, and I would love a little bit more detail on what led to that decision and when you know, we might see some of these supply chain challenges that you're do going with beyond snarled when it comes specifically to that body.
Yeah, I like to highlight the fact that we are not reducing production. We are reducing the speed of ramp up on the eight to twenty. We are actually doubling production roughly within two years from twenty four to twenty six, and we have decided to go from what we were anticipating for next year that was rate fourteen to actually rate twelve, So moving up from rate six a few quarters ago, a few years ago to the rate twelve.
We are on that trajectory. Things are moving forward quite well in twenty twenty five, but right twelve is a challenging target. We have to integrate as well the work packages from spirits on the AD to twenty, the wings and other smaller work packages, so we have a lot on our plate. We're also introducing progressively engine improvements to improve the durability of the engine for customers, so a lot of work on day to twenty very far and steep ramp up, and we think that's good enough in
terms of quantity of work and challenges. Moving from twenty five to twenty six.
I have to ask you about the defense business. Obviously that was a bit of a boost for you in the most recent period. Is this a long term story or one off.
It's a mid term story for sure, maybe a long term one as well. You know that Europe has relied on the United States for a very long time when it comes to security of Europe, and we are now in different times. Europe is really ramping up in its ability to secure itself, to defend itself, which means significant increase in defense budgets for the main countries of Europe and the Natal members in Europe. So from that perspective,
it's a midterm or even long term perspective. And on the short term it comes with orders for more equipment for development of new ones. And indeed we have a tailwind when it comes to our numbers and our growth coming from defense against that backdrop.
And we shall also talk about your ambitions when it comes to space as well, and to compete against elon musk SpaceX I know that you're merging some of your operation with regional peers trying to create a regional venture. That project expected to be running in twenty twenty seven GM. Would you anticipate though you might run into any sort of regulatory challenges? Here is twenty twenty seven looking like a firm date.
Well, we just signed the memo honub of understanding with Talis and Leonardo to create that European player and that is able to or will be able to compete at scale on the global.
Competitive landscape. So that's really good. We are not.
Only willing to compete with SpaceX and starting obviously that's a big player and a fast moving player, but we are serving many other needs, including defense in.
Europe and across the world. That creates a.
Company that has the put on sun to be very competitive to serve the interest and the needs of the European players and more global players. As I said, we have to go through the regulatory process to the anti trust.
That's something that is now ahead of us.
Well, I think Europe has moved forward as well, understanding that it needs to be able to compete globally, and we hope that we will be supported for what we're doing. We have to demonstrat compliance with the European regulations and other regulations.
We're starting at work now, all right.
Really appreciate you taking time for us and CEO of the air Bus theregy for on the heels of the earnings just alt most recently, but a big focus right now on potential delivery delays.