Airbus blasted by leasing companies over plans to lift jet production

Two of the world’s largest aircraft leasing companies have warned Airbus that its bold plans to speed up production are unjustified given still subdued demand from airlines after the coronavirus pandemic. The European jet manufacturer surprised the market in May when it set out aggressive plans for a steep increase in the production of its A320 family of jets, the world’s most popular narrow-body passenger aircraft. The CEs of Avolon and AerCap, wrote to Guillaume Faury, Airbus CE, in recent weeks to express their concerns that the aircraft market would not support the most aggressive increases in output rates, according to four people familiar with the situation. A surge in supply of new aircraft, potentially flooding the market, could push down the value of the lessors’ existing fleets. They make their money by renting to airlines. There is also wider concern that suppliers, many of which were forced to reduce their workforces during the pandemic and are facing rising raw material prices, would be unable to cope at this point in the recovery. Two people confirmed that one of the letters had been copied to the CEs of aero-engine makers, including Safran and General Electric. Airbus has emerged from the pandemic as the world’s number one aeroplane maker. Some executives said they believed the company’s aggressive rates were, in part, driven by a desire to capitalise on that position. The success of its A320 jets has given it a 60% share in the single-aisle market and the upper hand over its US rival Boeing. Story has more.<br/>