Airbus First-Half Deliveries Drop 49% Amid Covid-19 Aviation Crisis

Airbus Group SE (EADSF) reported that deliveries in the first six months of the year almost halved, while no orders were registered in June as the aviation crisis tied to the coronavirus pandemic throttled demand for aircraft.

Deliveries this year totaled 196 commercial aircraft compared with 389 during the same period last year. Meanwhile, on a month-to-month comparison deliveries in June showed an increase to 36 aircraft from 24 in May and 14 in April. However, the ailing planemaker said that it did not get a single new order in June for the second month in a row.

By aircraft type, a total of 11 A220s, 157 A320 Family, 5 A330s and 23 A350s were delivered in the first half of 2020. In June, Airbus delivered one A220-300 to Air Canada and 31 A320neo Family aircraft including the first A320neo to China Express and first A321neo to VivaAerobús. For Airbus widebody aircraft, four A350-900s were provided, two to Iberia, and one each for Air France and SAS.

The COVID-19 crisis has led to an almost 40% drop in jet business activity, forcing the planemaker to resize its commercial aircraft activity. Earlier this month, Airbus announced plans to shed 15,000 jobs globally this year to help the company navigate through the aviation crisis and secure its future.

Airline travel has fallen off a cliff due to lockdown restrictions forcing many airlines around the world to ground the majority of their fleets and to sharply reduce spending. This has resulted in a deep cut in the number of commercial jets planemakers’ customers need over the next few years with some asking for delivery delays or order cancellations.

Airbus’ backlog of aircraft remaining to be delivered as of June 30th stood at 7,584.

Shares in Airbus have lost almost 50% of their value this year and were trading down 1.2% at $74.99 on Thursday.

Looking ahead, it looks like Wall Street analysts expect some recovery in the shares over the coming year, with the average price target set at $84.83, which reflects 13% upside potential.

Overall, analysts have a cautiously optimistic outlook on the stock. Out of 15 recent reviews, 9 have Buy ratings, 5 Hold ratings and 1 has a Sell rating which add up to a Moderate Buy consensus. (See Airbus stock analysis on TipRanks).   

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