Airbus reports strong Q1 performance amid tariff concerns

In the first quarter of 2025, Airbus, the largest planemaker globally, reported revenues and profits that exceeded analyst expectations. This news comes at a time when global trade tensions, particularly a tariff war between the U.S. and Europe, are escalating. The company indicated that although their adjusted operating income grew by 8% to 624 million euros and revenues went up by 6% to 13.54 billion euros, quantifying the specific impact of the ongoing tariff issues remains challenging. Airbus noted that defense revenues helped mitigate the adverse effects of lower delivery numbers of jetliners. Boeing's European rival indicated that the deliveries for 2025 are projected at 820 aircraft, an increase from 766 last year. However, the company cautioned about potential supply chain problems that could affect the smooth delivery process, especially in the latter part of the year. Airbus has expressed optimism about maintaining its production forecasts despite the complexities posed by a recent agreement to take over some factories of Spirit AeroSystems. This U.S. aerostructure supplier has been struggling, impacting the ramp-up of Airbus's A320 and A350 jet production. Additionally, CEO Guillaume Faury highlighted the urgency of reinstating a 1979 treaty that has facilitated duty-free trade in aircraft components among 33 nations. The current situation has been complicated by the imposition of significant tariffs by the U.S. government, particularly under the Trump administration. Although the European Union is preparing countermeasures, Airbus has stated that it has not yet faced severe tariff impacts from the ongoing conflict between the U.S. and China. Faury has ruled out paying tariffs for U.S. airlines that opt to receive their aircraft from Europe, as seen with Delta Air Lines that has delayed deliveries to avoid these tariffs. In its defense arm, the company is cautiously optimistic about future production levels of the A400M military airlifter, despite previous setbacks stemming from delays and partial cancellations. They continue conversations with countries involved in purchasing and production, anticipating that increased European military spending may revitalize interest from nations like France and Spain. Overall, while Airbus shows strong results in the current fiscal quarter, the outlook remains cautious as they navigate uncertainties in international trade and supply chain dynamics.