Airbus is planning to invest a significant amount of money into its A220 program. This is according to a 20 February report by Reuters. Airbus’ CEO indicates that the European manufacturer is ready to invest between 500 million euros and 1 billion euros (US$1.08 billion) this year.
The comments were made by Airbus Chief Executive Guillaume Faury on Thursday at the company’s Canadian A220 factory in Mirabel, just outside Montreal. Earlier this month, Airbus took over part of Bombardier’s share of the program as the Canadian company was unable to invest the necessary funds to ramp up production. Airbus now has a 75% stake in the program with the other major shareholder being the Canadian province of Quebec.
Airbus has said that this will secure 3,300 jobs at Airbus Canada in Quebec. Bombardier will receive a consideration payment of $591 million with regards to the transaction.
The A220 has gained popularity since Airbus took a majority stake in the program in 2018. While its backlog is not as large as the A320-family of aircraft, the A220 still has about 550 unfulfilled orders as of the end of January. Airbus will not disclose its production rate, citing reasons of confidentiality.
However, the company did disclose that there were only 48 A220s delivered in 2019. Doing the math – the rate for one plant has been only four per month. However, Airbus has the intention of ramping up production of the smaller aircraft. This will partially be done through its Mobile, Alabama plant, which came online recently. Airbus says that it wants to be able to produce four per month by 2025 at this new plant. Back at its Canadian facility in Mirabel, Airbus is aiming for a 10 per month rate by 2025.
Adding the numbers, it looks like the manufacturer is aiming for 14 aircraft per month by 2025. This means a backlog of 550 would still take several years to clear, even with production ramp-up taking place in 2025.
In comparison, Airbus’ A320neo program completed 551 A320neo family aircraft in 2019. This works out to an average of 46 aircraft per month – dwarfing the production rate of the A220.
The A220 has become a favorite amongst travelers and seems to have gained significant momentum in 2019 as it secured notable orders from airlines like Air France. Some airlines have even indicated an interest in a stretched version of the aircraft.
The A220 is already having a great start this year as it signed a Memorandum of Understanding with African carrier Green Africa Airways for 50 of the aircraft. Furthermore, U.S.-based Air Lease Corporation placed an order for 50 A220-300s as part of a larger 102-aircraft order with Airbus.
We are excited to see Airbus invest further in this program in order to get more aircraft out to its customers.
Do you think Airbus should increase the production rate sooner than 2025? Where do you think suitable new factories could go? Let us know in the comments!
We reached out to Airbus for additional details on how this large investment would be spent. We will update this article if we receive a response from the company.