Airbus Group: Delta in talks with Airbus for big order, Stock Market appreciates

(BFM Bourse) – The American company is in discussions with a European aviation group to order the A350 and A330 neo, according to Bloomberg, which mentions “dozens” of possible units. Which gives less energy to the action.

If the supply, or more precisely the ability to provide aircraft, has sometimes failed Airbus in recent months, the former EADS still seems to be able to rely on high demand. This is confirmed by the news reported on Monday evening and Bloomberg.

According to anonymous sources quoted by the press agency, the American company Delta Air Lines would negotiate with the European aviation group with a view to a “significant” order for large carriers, the A350 and the A330 neo (a redesigned version of the A330). .

According to the agency’s sources, the final agreement is not yet guaranteed at this stage. The potential order could be for “dozens” of aircraft, with Delta Air Lines working to replace a total of 100 flagship aircraft, namely A330s and 767s.

When contacted by BFM Bourse, an Airbus spokesperson had no comment.

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Replacement wave

The group’s potential order is in line with the optimism expressed by all airlines, which see strong demand and recovery on long-haul flights. Companies are therefore increasing their flying capacity and are encouraged to restart their projects to revive their long-haul fleet, which they had been able to suspend during the pandemic.

On the Paris Stock Exchange, Airbus shares seem to appreciate this press release, the title taking more than 2.2% around 3:15 pm, the biggest increase of the CAC 40.

“It’s positive for Airbus because it confirms that a big wave of widebody replacements is coming and this order would give Airbus more visibility. Especially since Delta has a reputation for planning the evolution of its fleet and is a reference in that regard. So this will send a message of confidence even if it is clear that it will be necessary to deliver the plane,” continues the financial analyst.

For Jefferies, “the command, if confirmed, will benefit […] especially for Rolls-Royce, the sole engine supplier for the A330neo and A350, as well as Airbus.”

On the London Stock Exchange, Rolls-Royce gains 2.2%. The British engine manufacturer can also benefit from the decision of Jefferies, in particular, which has decided to dedicate value as its favorite in the European aerospace industry.

The Paris air show is visible

These press releases also come a few days after Turkish Airlines announced that it will order 600 aircraft, consisting of 400 single-aisle and 200 wide-body aircraft. The order split between Airbus and Boeing has not been announced. The curtain could be lifted in two stages, with the first announcement in early June, during an event organized by the International Aeronautics Association, and the second the week of June 19 at the Paris Air Show.

Until then, the market will continue to follow the evolution of Airbus delivery. At this time, the group, at the end of April, has delivered 181 aircraft, 9 less than the same period last year, knowing that it will have to deliver 540 in eight months to reach the goal of 720 devices. Two weeks ago, Guillaume Faury, executive chairman of Airbus, indicated that the achievement of this goal would be achieved by the end of the year, especially in the last four months.

Bank of America believes that the group’s supply chain, which is currently under strain, is improving and should continue to improve, thus supporting delivery in the second half. “‘But it’s clear that the more concentrated issuance profile at the end of the year is a concern for some investors,” he insists. So the bank of America thinks that the subject of tension in supply will be an important thing to consider during the Paris Air Show.

Julien Marion – ©2023 BFM Bourse