Airbus seeing ‘momentum’ on A220

Airbus SE’s new assembly line in Alabama increases the European-based plane maker’s North American footprint at a time when U.S. rival Boeing Co. is struggling.

Airbus purchased a 50.01 per cent stake in Bombardier's formerly named C Series in July 2018. Since then, the French OEM has changed the name of the aircraft to the A220. Airbus Photo
Airbus purchased a 50.1 per cent stake in Bombardier’s formerly named C Series in July 2018. Since then, the European OEM has changed the name of the aircraft to the A220. Airbus Photo
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In August in Mobile, Ala., an Airbus joint venture started making the narrow-body A220, formerly known as the Bombardier C Series.

By contrast, Chicago-based Boeing is focused on returning its grounded 737 MAX jets to service.

“On the A220, we see good order momentum,” said Airbus chief executive officer Guillaume Faury during a conference call with industry analysts.

Airbus owns 50.1 per cent of the Airbus Canada Limited Partnership, which is responsible for the A220. Montreal-based Bombardier Inc.’s stake is nearly 34 per cent and the Quebec government’s investment agency has a 16-per-cent interest.

Faury didn’t directly address Airbus’s rivalry with Boeing, but acknowledged issues with the 737 MAX are “something we see in the press.”

In March of this year, a Boeing MAX 8 flown by Ethiopian Airlines crashed after takeoff from Addis Ababa, killing 157 people. In October of last year, 189 people died when a MAX 8 operated by Lion Air of Indonesia fell into the Java Sea after leaving Jakarta.

“That continues to weigh heavily on our company and we’re always going to remember that,” said Boeing chief executive officer Dennis Muilenburg during a presentation to analysts in August.

“We are working with regulators around the world,” he added, explaining that many approvals will be required before the grounded MAX narrow-body jets return in full force to the skies.

Airbus and Boeing both have global production rates that are slower than what airlines and other customers such as aircraft lessors would like to see.

“We saw a slowdown in overall activity in 2018 driven by supply chain-related delays from Airbus,” according to an analysis by Macquarie Research. “Volume for 2019 is currently lagging 2018 in terms of dollar value of transacted aircraft, given a continuation of Airbus delays as well as the global grounding of the 737 MAX.”

Since 2015, Airbus has done final assembly of the A320 aircraft family in Alabama.

Besides opening the new A220 line in Alabama, Airbus is also continuing with A220 production at its plant in Mirabel, Que., which employs 2,200 people.

While Airbus concentrates on commercial aviation in Alabama, Boeing has a strong presence as the largest aerospace firm in the state, with operations ranging from missile defence to space launch systems.

Steven Udvar-Házy, executive chairman and co-founder of Los Angeles-based Air Lease Corp., pointed out that Airbus has been facing production backlogs, including with the single-aisle, twin-engine A220.

Air Canada's A220 fleet is being assembled in Airbus' plant in Mirabel, Que., pictured here. Howard Slutsken Photo
Air Canada’s A220 fleet is being built in Airbus’ plant in Mirabel, Que., pictured here. Howard Slutsken Photo

“Based on Airbus getting control of the C Series aircraft, we made a decision to go ahead and order 50 A220-300s,” he told the Deutsche Bank Aircraft Finance and Leasing Conference in September. “We believe this is the most efficient aircraft in the 120 to 150-seat size.”

Udvar-Házy envisages a bright future for the A220, which saw its share of program development delays under Bombardier.

While there are production constraints in Montreal and Mobile, the A220’s increased popularity today contrasts with the struggles to garner customers in the past. “The airplane is getting more acceptance across the board,” said Udvar-Házy.

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He noted that broadly speaking, speeding up deliveries isn’t easy, including for the long-range, wide-body A321neo: “We had discussions with Airbus, for example, to try to accelerate some of our 2024 A321neo positions into 2023.”

After tense corporate times for Airbus and Bombardier, the chronology of events eventually tilted in their favour.

In September 2017, Boeing persuaded the U.S. Department of Commerce to impose stiff duties on planned sales of the C Series in the United States.

The following month, Airbus and Bombardier signed a deal to create a new U.S. assembly line for what was then known as the C Series, targeting American customers.

In early 2018, the U.S. International Trade Commission dismissed the Commerce Department’s decision, which alleged the C Series benefited from subsidized pricing.

Fast forward to August 2019, and Airbus is touting the newly opened line for the A220 in Mobile.

“With Mobile, and our production network in Asia, Canada and Europe, we have strategically created a worldwide industrial base to better serve our customers,” said Airbus Americas chief executive officer Jeffrey Knittel in a statement.

Air Canada announced that it will deploy two of its A220-300s in the spring of 2020, with non-stop service on the Montreal-Seattle route and between Toronto and San Jose, Calif.

The A220-300s ordered by Air Canada are being built at Airbus Canada Limited’s Mirabel plant. Air Canada said it will be the first North American airline to fly the larger A220-300 version of the jet.

Editor’s Note: Swiss International Air Lines grounded its entire fleet of A220 aircraft on Oct. 15, following what it called a series of “technical irregularities” relating to the aircraft’s engines. On Oct. 17, Swiss resumed flight operations, adding that its 29 aircraft had all passed inspections.

 

6 thoughts on “Airbus seeing ‘momentum’ on A220

  1. Your Airbus A220 and Alabama plant dates are wrong. Airbus was not producing CSeries in Alabama since 2015. Alabama plant opened about 2018/19 – also Airbus was not involved with CSeries until about 2017.

    1. Hi Daly, that date is referring to the A320, not the A220, which was not said to be a part of the C Series in the article.

  2. AC should use the plane for a non-stop Vancouver-Halifax route. It would be perfect for that and the present route going through Toronto or Montreal is really bad.

  3. Airbus Canada Limited Partnership/Société en commandite Airbus Canada Mirabel Québec. ……. Official Percentage: * Airbus 50,1% * Bomdardier 33,55% *Investissement Québec 16,44%.

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