Airbus has alerted customers that hundreds of its A320neo family jets will need to be inspected for potential structural defects linked to faulty manufacturing techniques at a supplier.

Most of the jets — some 460 airframes — are in Airbus’s manufacturing system in some fashion and haven’t yet been delivered to customers, Airbus told A320 customers last week. Another 168 of the airplanes are in-service, according to a presentation viewed by Bloomberg. In total, the universe of aircraft that have to undergo checks stands at 628, according to the presentation.

The affected jets exterior skins may be either too thin or too thick in comparison to Airbus’s manufacturing specifications, due to variability in the milling process, according to the presentation. The checks are so wide because the panels don’t have serial numbers, making them harder to trace.

The panels at issue are on the crown of the A320 and adjacent on either side to the main front door. While the inspections are relatively straightforward and non-invasive, they’ll need to be done on all of the planes since the bad batch of parts isn’t traceable via serial number, said a person familiar with the matter.

Of the total number of planes possibly affected, 168 are already in service, while 245 are on the final assembly line or being prepared for delivery. Another 215 are in the early stages of production. Airbus said in the presentation that a “significant proportion” of panels will conform, and will therefore be acceptable in their current state.

Qantas and Air New Zealand said on Tuesday that none of their planes are affected by the issue.

“The source of the issue has been identified, contained and all newly produced panels conform to all requirements,” an Airbus spokesperson said.

The company’s shares fell as much as 10 per cent on Monday before closing 5.8 per cent lower.

It represents the latest challenge for the planemaker after a weekend recall of its jets due to a software issue that led to thousands of jets being grounded across the world.

The problems emerged as Airbus is beefing up efforts to meet challenging delivery targets for the year and has also been distracted by a weekend recall of jets over a software bug.

The suspected production flaw is delaying some deliveries but there are no immediate indications that it has reached aircraft in service, industry sources said, asking not to be named. The origin of the problem could not immediately be identified.

Shares in airline customers Lufthansa and easyJet were dragged lower by the news, traders said.

A person with direct knowledge of the matter said some deliveries were already being impacted, but there was no
immediate confirmation of how many nor for how long.

Industry sources said the planemaker delivered 72 aircraft in November, fewer than many analysts had previously expected and bringing the total for the year so far to 657.

It is targeting “around 820” deliveries for the year, meaning it would have to reach a record performance of more than 160 jets in December.

The record for the final month of the year was 138 in 2019.

Clock ticking on delivery targets

Analysts were divided on whether the world’s largest airplane maker will meet the delivery goals, which determine revenue and cash flow as airlines pay much of a plane’s value on delivery.

Jefferies analyst Chloe Lemarie, who tracks the handover of aircraft and is forecasting 71 deliveries for November, said the month’s performance was weaker than expected.

The target remains within reach, however, as underlying production is rising, she added in a note to investors issued before word emerged of the reported quality problem.

Independent aviation analyst Rob Morris said Airbus could reach about 800 deliveries - which others say might be enough to claim victory based on the wording of its forecast - but with some risk that the final outcome will be “marginally lower”.

Bloomberg, Reuters

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