Airbus CEO Highlights New Risks After Major Trade Impact

• Trade tensions between the U.S. and China caused significant collateral damage, including U.S. tariffs on rare earths and restrictions on engine exports needed for Chinese C919 jets and Airbus planes assembled in China
• Supply chain issues persist with Pratt & Whitney and CFM engines continuing to arrive late, while Airbus faced a major recall in November and production halt due to flawed fuselage panels
• Faury emphasized that profitable growth in the second half of the 2020s is essential to fund development of an A320 successor entering service in the latter part of the 2030s, as Airbus and Boeing prepare for their next aircraft development competition

Summary: Airbus CEO Warns of Geopolitical Risks Amid Trade Tensions

Key Developments:

Airbus CEO Guillaume Faury warned employees in an internal memo that the planemaker faces "unprecedented" geopolitical risks following "significant" logistical and financial damage from U.S.-China trade tensions and protectionism in 2025. The warning comes as 2026 begins with heightened global uncertainty, including NATO tensions and disputes over Greenland.

Trade Impact:

U.S. tariffs imposed by President Trump last April triggered Chinese retaliation through rare earth export controls. Washington subsequently restricted exports of engines and components to China, affecting both China's C919 jet and Airbus aircraft assembled in China. Aerospace has received partial tariff relief.

Business Performance:

Despite trade disruption, Faury cited "good results" for 2025 across Airbus's 160,000-person workforce. Results will be published February 19. Key highlights include:

• Airbus Defence and Space on "much stronger footing" after restructuring
• Helicopters division showing "remarkably consistent" performance
• Progress on commercial cost-cutting initiatives maintained financial goals despite a November recall and production issues with flawed fuselage panels

Operational Challenges:

Supply chain issues persist post-COVID, with "most serious difficulties" involving Pratt & Whitney and CFM engines. A320-family engines continue arriving late. Faury stressed the need for "more rigorous" systems and product management following the November software-related recall.

Strategic Outlook:

Faury emphasized achieving "profitable growth" through the late 2020s is critical for funding A320 successor development in the 2030s, positioning Airbus for competition with Boeing in the next aircraft development cycle.