Airbus books slew of lost orders while deliveries lag output

London

AIRBUS suffered a surge in order cancellations last month, as Norwegian Air Shuttle ASA scrapped narrow-body jet purchases and a wave of coronavirus lockdowns pushed back expectations for a revival in air travel.

The European planemaker lost 92 commitments in February, it said in a statement last Friday, 88 of them from the Scandinavian discounter, which is seeking to restructure under bankruptcy protection. The manufacturer suffered only 115 lost orders in the whole of 2020.

While the hit from Norwegian was not unexpected, a more fundamental concern surrounds Airbus's ability to get other customers to keep on taking planes. The company handed over only 32 in February, less than the number assembled. The weak start to 2021 may explain its surprise announcement last month that deliveries would likely be flat for the year.

The balance of shipments to the current build rate of about 50 planes a month points to an increase in undelivered jets. That tally was already around 100 in mid-February, comments from chief executive officer Guillaume Faury showed, including a number of "white-tails" lacking a customer.

Jefferies analyst Sandy Morris said the trend could jeopardise a planned ramp-up in A320neo narrow-body production planned for the second half if it persists. Airbus set a brisk pace for jet handovers in the final months of 2020 as it raced to boost year-end tallies.

A lawyer for Norwegian Air told an Irish court on Feb 24 that the carrier was nearing an agreement to end deliveries from Airbus as part of a restructuring that has seen it enter a so-called examinership process.

Airbus secured 11 new orders in February, comprising a deal for 10 A320s from an undisclosed buyer, plus a single A330 wide-body.

Boeing is meanwhile accelerating deliveries of its single-aisle 737 Max after the jet was grounded for 20 months following two fatal crashes.

The US firm handed over more planes than Airbus for the first time in two years in January, as it began to clear a backlog of 737s, though the build rate remained lower at 26 jets across all models, said Barclays. It is slated to announce February figures on Tuesday. BLOOMBERG