Tuesday, April 07, 2009

Airbus Is Ramping Down Production in Response to Lower Orders

Daniel Michaels reported in yesterday's Wall Street Journal,

"Airbus said Friday that it booked orders for just 16 planes in March, compared with 54 orders in March 2008 and 37 orders the previous year. The company has said it may capture only between 300 and 400 new orders this year, down from 777 orders minus cancellations last year."

How does one lower production in an outsourced world? The care and feeding of supply chains gets tricky. France created the Aerofund to help suppliers deal with the strong Euro and expand. It is now diverting funds from it to stay afloat in the crisis. Airbus's production chief, Tom Williams, told the Journal, "With a limited investment, we'll buy strategic components with very long lead times and carry them ourselves. It gives us more flexibility."

Here in Wichita, we have Sirit and its suppliers to worry about.

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