Superjumbo delays lead to Airbus loss

Planemaker Airbus slumped into the red today as the impact of delays on the A380 superjumbo were revealed by its parent company, EADS.

Airbus made underlying losses of €572m, compared with earnings of €2.3bn in 2005 and despite delivering a record number of aircraft in 2006 – 434 against 378 a year earlier.

Amsterdam-based EADS, which lost €768m in the fourth quarter of 2006, warned that Airbus would display “another substantial loss” this year.

EADS chief executives Tom Enders and Louis Gallois predicted the recently announced Power8 plan, which will cut up to 10,000 jobs in the coming years, would help return the unit to profitability.

The planemaker said last week that it would cut posts across its 16 European sites, with those in France and Germany being hardest hit. Around 1,600 cuts in the UK will be split mainly between Broughton in North Wales and Filton, near Bristol, with half expected to be among contract staff rather than directly employed workers.

As well as delays on the A380 superjumbo, EADS has faced charges on its A350 XWB programme, along with higher research and development costs and the impact of the weaker dollar.

Overall, EADS earned €99m in 2006 compared with €1.67bn in 2005.

In a statement, the company said: “It will take some time but Power8 will make Airbus substantially more integrated and efficient.

“For 2007, our priorities are to drive operational improvements, restore the group’s credibility and build a leaner and more dynamic EADS.”

Looking ahead this year, the company said it expects revenues to experience a single-digit increase and added that Airbus revenues would likely remain stable based on an expected 440 to 450 deliveries this year.