Airbus “Bleeding Cash” As Pandemic Forces Company To Cut Production

Aircraft manufacturer Airbus has issued a stark warning to its employees as it continues to grapple with the on-going impact of the coronavirus on its business operations, Reuters reports. It has already furloughed thousands of workers in France and the United Kingdom, with Guillame Faury, the company’s chief executive officer, warning of possible additional job cuts.

Thousands Furloughed, Growth Stunted

Out of 135,000 employees, Airbus has furloughed 3,000 workers in France plus 3,200 staff in Wales. In an internal letter to staff quoted by the outlet, Faury stated last week that the manufacturer was “bleeding cash at an unprecedented speed”. Worryingly, he also said that the recent tumble in production rates – which have been slashed by a third or even more – wasn’t the worst possible outcome for Airbus at the present time.

While Airbus has taken up the furlough assistance for employees as offered by the French government, Faury explained that the company may need to implement additional “far-reaching measures”.

In the letter, which was sent to employees ahead of the publication of its first-quarter results, Faury wrote, “The survival of Airbus is in question if we don’t act now.” He also added that the company has, “…lost roughly one-third…” of its total business.

Cutting Production To Preserve Cash

In order to preserve its cash reserves, the news agency reports that Airbus is cutting the production of its narrow-body jets, meaning it will produce just 40 of these such crafts a month. The company has also revealed that it will be cutting the production of its wide-bodied craft.

In a statement made earlier in April, Airbus confirmed that it would be adapting or even pausing production at its sites in Germany, the United States, France, and Spain.

The Future Is Uncertain

Faury added that these restrictions on the pace of operations at Airbus would need to be held as long as possible in order for the company to make a reasonable assessment of market demand. Commenting on any hopes of recovery for the manufacturer, Faury added, “Unfortunately, the aviation industry will emerge into this new world very much weaker and more vulnerable than we went into it.”

Airbus has declined to comment on the letter from Faury, but on its website, the company states, “Airbus is closely monitoring the evolution of the coronavirus (COVID-19) pandemic across the globe and is assessing the situation, the impact on employees, customers, suppliers and the business. The health and safety of Airbus employees is paramount.”