Airbus to spend €260 million for crack repair in 2012
From Aviation Week...
Airbus is taking a €158 million charge linked to the costs associated with wing component cracking on its A380s with more costs excepted to come.
The latest charge covers repairs on 71 aircraft delivered and comes on top of a €105 million provision taken in March because of the same problem. Airbus CFO Harald Wilhelm says additional costs are due this year to cover the cost of fixing around 30 A380s being delivered this year. That could bring the bill to €260 million for 2012, he says.
Airbus has now identified a permanent fix to deal with the cracking of some of the L-shaped wing rib-feet in A380 wings, says EADS CFO Hans-Peter Ring. The European Aviation Safety Agency (EASA) still has to sign-off on the fix, which will then trigger another airworthiness directive. Only once EASA has okayed the plan will Airbus be able to set when repair kits are available, Ring indicates.
“This final retrofit fix is more complex than initially anticipated in March,” EADS says in its first quarter earnings statement, noting that it is driving the €158 million charge.
Discussions are also only starting with airlines on how to apply the final fix, Wilhelm says. “This is a case-by-case discussion.” The implementation is expected to start toward year-end, with deliveries in 2013. Forward fit of the fix is to start in parallel, although the first aircraft are to be delivered in 2014.
Qatar Airways, for instance, has said it will only take its A380s once the final fix is installed on the aircraft - the first handover to the Middle East carrier is due next year.
The fix also has hit A380 delivery plans. Airbus has temporarily slowed A380 production, with the impact of that move expected to be seen in 2013.
For this year, the aircraft maker expects to hand over 30 A380s. But reaching that target is “becoming more challenging with a more back-loaded delivery pattern,” Wilhelm says.
The setback comes as Airbus was looking forward to improving profitability on the A380 program after years of big losses. EADS notes that “the implementation in production of the final fix will temporarily generate headwind on the year-on-year A380 [earnings before interest and taxes] improvement in 2012 and 2013 to account for non-recurring costs and delivery adjustments.”
More at: http://www.aviationweek.com/Article...._p0-457966.xml
Last edited by J Boyle; 21st May 2012 at 21:17.
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