... and Airbus couldn’t be more loud. What awaits the winged giant?
Darwin’s ‘Survival of the fittest’ theory wouldn’t prove too wrong in the current times, when citadels are tumbling everywhere; and a positive earning reportage is so welcome! So there’s another ‘fit’ $10.3 billion-worth parent of Airbus, EADS, that made all proud by registering a profit of $1.99 billion for FY2008 after a miserable ‘supply-led’ $580 billion loss in 2007 (thanks to the A380 project that nearly broke its back twice!). Yes, good news for now; but, the question remains – will it continue the good work when it comes to making profits?
Louis Gallois, CEO, EADS, seems upbeat about the future of the changed organisational structure. He states, “We made significant headway in reshaping the company. The group has regained stability in 2008 and is proving to be resilient in the face of the turbulent global economic environment.” But isn’t slowdown a drag on the aircraft manufacturing giant? Well, here the man minces no words as he asserts, “2009 will be a very challenging year for our industry!” Indeed so, the demand side of the market has wilted temporarily, with IATA (Report titled: lengthy recession is now main challenge) forecasting an air passenger traffic contraction of 3.6%, a cargo contraction of 5%, and a revenue fall of 6% in 2009 as compared to 2008. And worst, the industry is predicted to burn another mighty $2.5 billion in losses for 2009!
The giant today is finding itself in the thick of the turmoil in the sector, with many aviators finding it tough to finance their purchase of an aircraft priced anywhere between $65-500 million. And order backlogs? They stink! “At the end of 2008, Airbus had 3715 aircrafts backlog,” states Craig Fraser, Analyst, Fitch Ratings. Yes, efforts like a tie-ups with the French Coface or German Hermes to finance upto 50% of aircraft value for its clients are on... but to what extent can it clear the huge backlog (not adding the new orders received in 2009 standing at 777 aircraft orders, valued at a mighty $100 billion at list prices) remains questionable... For now though, gallop-on, Gallois; as far as you can ride (fly?).
Darwin’s ‘Survival of the fittest’ theory wouldn’t prove too wrong in the current times, when citadels are tumbling everywhere; and a positive earning reportage is so welcome! So there’s another ‘fit’ $10.3 billion-worth parent of Airbus, EADS, that made all proud by registering a profit of $1.99 billion for FY2008 after a miserable ‘supply-led’ $580 billion loss in 2007 (thanks to the A380 project that nearly broke its back twice!). Yes, good news for now; but, the question remains – will it continue the good work when it comes to making profits?
Louis Gallois, CEO, EADS, seems upbeat about the future of the changed organisational structure. He states, “We made significant headway in reshaping the company. The group has regained stability in 2008 and is proving to be resilient in the face of the turbulent global economic environment.” But isn’t slowdown a drag on the aircraft manufacturing giant? Well, here the man minces no words as he asserts, “2009 will be a very challenging year for our industry!” Indeed so, the demand side of the market has wilted temporarily, with IATA (Report titled: lengthy recession is now main challenge) forecasting an air passenger traffic contraction of 3.6%, a cargo contraction of 5%, and a revenue fall of 6% in 2009 as compared to 2008. And worst, the industry is predicted to burn another mighty $2.5 billion in losses for 2009!
The giant today is finding itself in the thick of the turmoil in the sector, with many aviators finding it tough to finance their purchase of an aircraft priced anywhere between $65-500 million. And order backlogs? They stink! “At the end of 2008, Airbus had 3715 aircrafts backlog,” states Craig Fraser, Analyst, Fitch Ratings. Yes, efforts like a tie-ups with the French Coface or German Hermes to finance upto 50% of aircraft value for its clients are on... but to what extent can it clear the huge backlog (not adding the new orders received in 2009 standing at 777 aircraft orders, valued at a mighty $100 billion at list prices) remains questionable... For now though, gallop-on, Gallois; as far as you can ride (fly?).
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