Airbus Uncertain of Timeline For Stretched A220

January 10th, 2022 at 4:15 PM EST

Airbus notched another win with an order for 22 A220s from regional-airline lessor Azorra, the first major order of the year for an airframer that reported a banner year last year, with more than 600 deliveries.

The Azorra deal cements the A220’s role “complementing” the A320 family, Airbus Chief Commercial Officer Christian Scherer told reporters on Monday during a call to discuss the company’s 2021 deliveries. Airbus expects demand for the aircraft to increase as airlines seek to replace aging jets at the lower end of the market. Last year, the airframer delivered 50 A220s, compared with 38 in 2020.

A stretched variant, the A220-500, is in the works, although when the program will formally launch remains uncertain. “It is not an imminent decision,” Scherer said. “It is a logical progression, and we have a lot milestones to achieve on that program,” he said, adding, “this is not an agenda item for a near-term decision.”

Allegiant Air’s decision to walk away from the A220 was informed, in part, by the uncertainty of when the -500 would launch. The Las Vegas-based carrier’s decision did not affect Airbus’s decision to proceed with the stretched variant, nor will it affect the timeline. Allegiant also opted for Boeing’s 737 Max over the A320 because of the unavailability of delivery slots from the narrowbody. Scherer noted the Allegiant deal with Boeing was “opportunistic” based on timing and deliveries. “We have to accept that.”

Airbus, at current production rates, has an 11-year backlog for A320 deliveries, which CEO Guillaume Faury acknowledged is a problem. But he noted that the 11-year backlog is based on 2021 production rates, and the airframer plans to ramp up production to more than 60 A320s per month within a couple of years. As the production rate increases, the delivery backlog will fall, but it is premature to update the numbers until production firmly rises, he said.

However, airlines that want A320s direct from Airbus will face long waits, Scherer said. The solution, in the near- and medium-term will be for airlines to acquire aircraft from lessors, which Airbus has been working with to iron out delivery problems. But this only applies to the A320 family, he stressed. Customers should not face long wait times for Airbus widebodies or A220s.

During 2020 and 2021, Airbus’s supply chain struggled to keep up with the airframer’s ambitious production targets, as they downsized in response to the Covid-19. After spending much of last year working with suppliers, Faury is confident the supply chain will be up for the increase in demand.

The spread of Omicron variant, and staff shortages at both Airbus and suppliers, is “an area of concern,” he said. So far, production has not been affected enough to push deliveries back. Lockdowns in Tianjin and Xian, two cities with large Airbus and supply-chain presences, also have not adversely affected manufacturing — yet. “We are monitoring the situation very closely,” Faury said. “We are on track to achieve our ramp-up plans.”

Nor has the shortage of semiconductors yet affected Airbus or its suppliers. Faury said the shortage has been most keenly felt by manufacturers of consumer goods and cars and has not yet affected aerospace. “There are no systemic issues with semiconductors in aerospace at the moment,” he said.

Airbus expects 2022 to be a year of “transition” out of the industry’s Covid-19 footing and back to more normal growth. The airframer did not expect to such a strong year last year. It started 2021 expecting a repeat of 2020, but demand for its products started to snowball starting in the summer, Faury said. “Many of our customers are now looking beyond Covid, and I think that’s good news.”

Airbus is happy with the aircraft program it launched last year, the A350 freighter variant. It has recorded 22 orders for the type so far. Faury acknowledged that the airframer is playing catch up with Boeing on freighters. “We responded to market feedback with the launch of the A350 [freighter].”

As for the other reason why the A350 is in the news, Faury was relatively quiet. Qatar Airways is demanding $618 million in damages for what it says are paint problems and surface erosion on its A350 fleet. Airbus counters that there are no problems that would affect flight and said it will fight the charges in court. The spat has not affected A350 production, he said, noting, “I have nothing more to add.”

Airbus delivered 611 aircraft last year, 8 percent more than in 2020. In addition to the A220s, it delivered 483 A320-family aircraft; 18 A330s; 55 A350s; and five A380s. Airbus reported 771 orders, or 507 net of cancellations. Orders include: 64 A220s; 661 for A320-family aircraft; 30 A330s; and 16 A350s, including 11 A350Fs.

These orders do not include the 100-aircraft order from Air France-KLM, which will be counted in this year’s orders after the deal is firmed up, Faury said.

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