Airbus warns Europe to gear up for a no-deal Brexit
Airbus has called on European governments to hasten their planning for a no-deal Brexit and bury the hatchet on a long-running subsidy spat with the US.
Europe’s biggest plane maker issued a warning this morning about rising trade tensions, overshadowing a strong set of second-quarter profits which pushed Airbus’s share price up 0.4 per cent.
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Chief executive Guillaume Faury said: “It is now obvious that no-deal is likely and we want all governments to be prepared for that, which was not the case by end of March.”
Airbus has built a stockpile of about one month’s supply of aircraft parts as a buffer to cope with Britain leaving the EU without a transitional deal, Faury said.
Plane parts are exempt from World Trade Organization (WTO) tariffs. But Airbus is concerned extra regulation could slow supply chains and hamper the movement of engineers.
“It’s important that there is a resolution at a given point, a settlement before tariffs are applied,” Faury said.
“We see the trade wars around the world growing and we don’t believe this is something … industry can benefit from and citizens can benefit from,” he said.
Faury also referred to US threats to impose sanctions on European planes and other goods following WTO rulings against EU subsidies to Airbus.
He called for an end to the dispute, while the results warned tariffs would hit deliveries if they go ahead. The EU is gearing up to impose counter-tariffs after the WTO ruled separately against US subsidies to Boeing.
Airbus said second-quarter adjusted operating profit rose 72 per cent to €1.98bn (£1.75bn), led by strong demand for jetliners. Revenues rose 23 per cent to €18.3bn.
But this did not include €436m in exceptional items, including €208m relating to the ongoing German blockade on arms sales to Saudi Arabia.
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Airbus is trying to find a way to produce more A320 aircraft, which are the direct competitor to Boeing’s grounded 737 Max. Rival Boeing last year posted its biggest ever quarterly loss as it continues to grapple with the crisis.
The European plane maker is seeking to capitalise on Boeing’s disastrous year, but industrial delays at a newly expanded plant in Germany are proving a stumbling block.
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