Airbus and Boeing Have Both Forgotten How to Make Money
Boeing’s 737 Max travails are well understood, but Airbus should be converting its huge order book into cash. That windfall never seems to arrive.
A heavy cash burden.
Photographer: BloombergBombardier Inc. has given up trying to compete in the commercial aerospace market by selling its remaining stake in the 100-150 seat A220 program to its joint venture partner Airbus SE. The 1.4 billion-euro ($1.5 billion) full-year net loss that Airbus announced on Thursday, alongside that deal, is a painful reminder of why Bombardier’s own large jet ambitions always looked doomed.
In theory, building commercial jets is a fantastic business. There aren’t many competitors — Airbus and Boeing Co essentially have a duopoly in large aircraft — and demand is booming. As people in emerging markets get richer they want to travel more and climate worries haven’t dissuaded most people from flying yet.