"I thought we were going to be in a better place," the head of the company's commercial airline division said
Airbus (EADSY) is struggling to take full advantage of the mess embroiling Boeing $BA (BA), its biggest rival. In an interview with the Wall Street Journal, Christian Scherer, the head of the French planemaker’s commercial airliner division, bemoaned his company’s difficulties in overcoming supplier bottlenecks to pump out jets more quickly.
“I thought we were going to be in a better place,” he told the newspaper. “There’s the whole future to prepare, but now there’s also the present to manage much more than we thought.”
Though Boeing stock is down more than 35% this year after a door plug blew off one of its 737 Max 9 planes and invited a massive amount of regular and investor scrutiny, Airbus stock is also declining, albeit only 3%. Still, that’s also a large fall considering that shares were up more than 20% earlier this year.
When the door plug incident occurred and the Federal Aviation Administration told Boeing that it would have to sharply curtail production speeds to better ensure proper safety and quality-control practices, Airbus said that it would go full speed ahead in a bid to shore up its superior position after Boeing’s last 737 Max issue.
But now Airbus is struggling to hit those numbers, lowering its own delivery guidance as it battles its own quality issues. Suppliers like Pratt and Whitney, whose engine troubles included a massive recall, are slowing things down — sometimes expensively so, as when Spirit Airlines (SAVE) said it would recoup as much as $200 million because it wouldn’t be able to fly many of the Airbus planes in its fleet while the problem persists. But that’s not the only reason.
Boeing is down but not out. Despite rumblings of new entrants into the commercial airliner market like Brazil’s Embraer, Bank of America $BAC (BAC) recently said that the American manufacturer is “too big to fail” as the other half of an international duopoly. Enginemaker CFM, for instance, decided to leave money on the table rather than pursue more business with Airbus because it didn’t want to lose access to Boeing if it eventually recovers.
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