According to industry sources, European aircraft manufacturer Airbus has issued a "cost control" directive to thousands of employees, mandating a 10% reduction in non-industrial expenditures within its core jetliner business and headquarters. This measure supplements the existing two-year LEAD cost-saving program and is intended to address persistent global uncertainties and supply chain constraints. The tightening measures, reportedly implemented for several weeks, partially target the use of external contractors, which have historically been a significant component of the group's resources.
This cost reduction initiative coincides with a critical period for Airbus as it ramps up production. The company's first-quarter financial report revealed a 7% year-over-year decline in revenue to €12.7 billion, primarily due to engine shortages and supply chain issues. The adjusted EBIT for its core commercial aircraft division plummeted 84% to just €81 million. Notably, supply bottlenecks for Pratt & Whitney engines from the U.S. remain a "critical pacing item" constraining increased production of its best-selling A320 family.
Despite the challenging start to the year, Airbus maintains its full-year targets of delivering approximately 870 aircraft and achieving an adjusted EBIT of around €7.5 billion. However, against the backdrop of current geopolitical tensions, the signal of intensified cost control, combined with the reality of slowing growth, has raised market concerns regarding the company's near-term profitability.
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