Airbus's landmark jet output cut faces crucial test

Airbus's decision to cut output of its best-selling jet by a third amid coronavirus marks a huge shift for the planemaker, which has enjoyed virtually unbroken growth since it began competing toe-to-toe with Boeing almost 20 years ago. The company's first significant cut in A320-family output, to 40 jets a month, brings production to the lowest level since 2012 and will be implemented in May or June, unions said. Airbus shares, which have fallen around 50% this year due to the crisis, wobbled on Thursday but ended up 2% as several analysts said the company had acted swiftly to reset output. But with all but a handful of airlines shunning deliveries as they hoard cash to survive the crisis, several industry officials and economists suggested the rate may be optimistic. "We have too many planes," said Avitas senior VP Adam Pilarski, who has long warned of a jet market bubble. With Boeing's competing 737 MAX still grounded after more than a year of safety reviews following two accidents, Airbus signalled on Wednesday that it was ready to act again if needed. "It is a first step," said Rob Morris, chief consultant at UK-based Ascend by Cirium, adding more reductions could be needed because of a large potential jet surplus.<br/>