Airbus CEO Says Supply Chain Is in ‘difficult Spot’

Airbus CEO Highlights Challenges in Aerospace Supply Chain Management

MONTREAL (Reuters) -Airbus is seeing mounting pressure on the aerospace supply chain and managing the problem is key to the industry’s recovery, the head of the European planemaker said on Tuesday.

“We really see that the supply chain is in a much more difficult spot than it was before,” Chief Executive Guillaume Faury told the Conference of Montreal by video link.

“We fear that the supply chain management for the next 12 to 18 months will be the most difficult part of what we have to achieve to really recover. Their situation is tough,” he said.

“If one or two or three are defaulting that’s the whole process that’s at stake. Therefore the supply chain management is really the key for the world recovery in front of us.”

Faury was speaking to an economic conference hosted by the International Economic Forum of the Americas by video link from the United States where domestic travel has been recovering from the pandemic. Global business travel remains sluggish, however.

“We see already a recovery, but (business travel) is unlikely to be back to 2019 levels for many years. There are also companies that are trying to reduce travel to cut emissions,” Faury said.

“There are a lot of business seats that are occupied by people who are not flying for business purposes. They are flying for leisure or meeting their friends and families.”

Rival Boeing earlier revised up long-term demand forecasts as a snapback in domestic air travel in the United States tempers the more gloomy industry predictions seen at the height of coronavirus lockdowns last year.

(Reporting by Allison Lampert Editing by Tim Hepher and Mark Potter)