Shares in Airbus flew higher Thursday after the company reported improved earnings and was more upbeat about the future following problems to several of its key aircraft programs. The company said that it surged to a net profit of E1b (US$1.25b) in Q4, from a loss of E816m a year earlier, while revenue was stable around E23.8b. Airbus delivered a record 718 aircraft last year and expects that figure to rise further in 2018, to 800. Shares in the company jumped about 10% Thursday in Paris. Investors seem optimistic that the company is putting behind it the worst of its troubles. Airbus said it took another charge of E1.3b on its A400 military planes. It said, however, that it had reached a deal with the govts that are buying the planes on a new delivery schedule that should rein in any new charges on the program. <br/>
general
Airbus and Boeing are cashing in on unprecedented demand by airlines for new planes, driven by record numbers of passengers taking to the sky. Passenger growth has surpassed industry expectations for several years. Last year, passenger growth hit 7.5%, beating the 5.9% forecast by IATA. Today’s largely synchronised global economic growth is lifting passenger numbers. But the falling cost of air travel, in part thanks to an increase in budget airlines around the world, is also contributing. The surge represents the “most rapid expansion at a global level that we’ve ever seen,” said John Plueger, CE of Air Lease Corp. Traffic growth has historically averaged around 5%, but now looks set to average 6% in coming years. Coinciding with all that new demand, airlines have benefited from several years of relatively low fuel prices. <br/>
President Donald Trump’s infrastructure plan promises few immediate benefits for US airports and airlines, primarily because current aviation laws block many types of public-private projects envisioned by White House officials. Trump’s initiative anticipates that roughly US$100b in federal grants over a decade will generate several times that much in state and local funds to build new roads, bridges, waterways and other big-ticket projects. But when it comes to terminal expansions, gate improvements or other upgrades of passenger amenities at the nation’s airports, some tough legislative barriers need to be overcome before specific projects that would divert airport revenue are even considered. Congress has established tight restrictions against using certain airport revenues for purposes outside the airport. <br/>