Speaker 1: Bloomberg Audio Studios, podcasts, radio news. We do want to
Speaker 1: stay in the transportation space and take a look at
Speaker 1: the European planemaker air Bus, the world's largest plane maker,
Speaker 1: the reported second quarter earning earlier today, and the big
Speaker 1: concern was the big cash burn I had a chance
Speaker 1: to catch up with the CEO of the air Bus
Speaker 1: earlier today, Keonfoi. Here's what he had to say.
Speaker 2: What we see in the first half of the euro
Speaker 2: is a number of delivery that is at three hundred
Speaker 2: and six. But we have also to have in mind
Speaker 2: that we have sixty aircraft sitting on the ground fully
Speaker 2: finished but with engines missing.
Speaker 3: We call them gliders.
Speaker 2: So if you look at what we've been able to produce,
Speaker 2: including the gliders, actually we are mostly on track with.
Speaker 3: What we expected to do in the first half.
Speaker 2: So we count on engine makers mainly CFM and to
Speaker 2: a smaller extent PRAT to recover on their engine deliveries
Speaker 2: to Airbus, so we can be back on track with
Speaker 2: a number of deliveries. So actually the negative free can
Speaker 2: show that we have recorded for the first half reflects
Speaker 2: mainly those missing deliveries and engine missing leading to aircraft
Speaker 2: on the ground, although we have confirmed our guidance because
Speaker 2: we believe we will get those engines and we'll be
Speaker 2: back to where we need to be.
Speaker 1: Are the delays in getting those engines? Is that related
Speaker 1: to labor issues or is that more for parts and
Speaker 1: just some hold ups in the supply chain.
Speaker 3: Well, that's more the latter.
Speaker 2: Actually, these are more short term issues that we are
Speaker 2: generated in the first half of the year. When we
Speaker 2: look at the CFM situation, ge faced industrial difficulties in
Speaker 2: the beginning of the year. They delivered their course the
Speaker 2: hot section of the engines late to the other partner,
Speaker 2: which is and then Suffa faced a strike seven week
Speaker 2: strike that impacted very significantly the ability to deliver home time.
Speaker 2: They are recovering now, so it's really a timing issue
Speaker 2: facing industrial challenges and we believe they are in the
Speaker 2: situation now to deliver us back to normality till the
Speaker 2: end of this year.
Speaker 3: So that's the outproof for the next part of the year.
Speaker 1: With regards to the backlog of orders, I am curious
Speaker 1: as to what adjustments, if any, you have had to
Speaker 1: make in light of some of the lord demand coming
Speaker 1: out of the US, the restructuring of the order book
Speaker 1: over with as well as a few other customers that
Speaker 1: at least for right now, might be on the sidelines.
Speaker 2: Actually, what we face at Albus is a very high
Speaker 2: level of demand.
Speaker 3: Overall.
Speaker 2: We have by far more demand than the ability to supply.
Speaker 2: We have a very strong backlock, the biggest backlog in
Speaker 2: the industry, and this backlog keeps going up, keeps growing,
Speaker 2: So we are not looking at it as a risk
Speaker 2: for our business moving forward. The other global demand keeps
Speaker 2: growing and we are doing our very best to ramp
Speaker 2: up to serve that demand.
Speaker 1: How manear is that? And more importantly, Gil, there's a
Speaker 1: big question here about whether some of your customers are
Speaker 1: actually asking for an acceleration and delivery of their order book.
Speaker 2: Well, actually most of them, if not all of them,
Speaker 2: are asking for an acceleration in the delivery. As I
Speaker 2: said earlier, we are held back by the ability of engines.
Speaker 2: We are ramping up on the eight three twenty family,
Speaker 2: which is the bulk of what we do, up to
Speaker 2: a production rate, a monthly production rate of seventy five
Speaker 2: aircraft a month by twenty twenty seven, that will be
Speaker 2: the highest ever achieved for a commercial aircraft. So that's
Speaker 2: the challenge we have in front of us. It's a
Speaker 2: good challenge because it reflects the strong demand we have
Speaker 2: for our products.
Speaker 1: You gave guidance and for investors here that explicitly did
Speaker 1: not take into account the framework of a deal between
Speaker 1: the United States and the European Union. When do you
Speaker 1: think you'll have a little bit more confident of factoring
Speaker 1: in that trade deal into your guidance.
Speaker 3: Well, that's an important question to us.
Speaker 2: We had the news over the weekend of the agreement
Speaker 2: and the fact that civil aviation will be back to
Speaker 2: the so called zero four zero meaning nor taris. That's
Speaker 2: something we have enjoyed since nineteen seventy nine and drives
Speaker 2: the success of this industry. We need something papered out
Speaker 2: and implemented. We need an agreement in forced as soon
Speaker 2: as possible to be able to be back to normal operations.
Speaker 3: That's something important to us. But we welcome the agreement.
Speaker 2: We hope it's going to be inforced as soon as possible,
Speaker 2: and iddly more a matter of weeks than a matter
Speaker 2: of months.
Speaker 1: Kay on Bori, they're the CEO of the world's largest
Speaker 1: plane maker, air Bus. They reported earning a little bit
Speaker 1: earlier in the day. The shares over there in France
Speaker 1: I fell slightly in the cash session, and their adr
Speaker 1: here in the US a little bit more than that