Airbus said it is airlines' responsibility to pay tariffs on imported aircraft during its first quarter earnings call.
“When we are exporting from Europe to United States, that's an import for the customers and they're also not very much willing to pay tariffs, but it's on them,” said Airbus CEO Guillaume Faury.
He added that when the company faced a similar situation during the previous Trump administration, the company said it looked for opportunities outside of the US. He added that some airlines were willing to pay the tariffs in order to secure the plane for its schedule. In an environment of delivery delays and supply constraints, the pressure to pay the tariff costs may be greater compared to 2019.
“[If tariffs] last for a longer term, the penalty and consequences on the US industry would be significant because those tariffs would have a significant additional cost on doing business in the US when you rely on components, parts, systems, and planes coming from outside of the US,” said Faury.
Faury said the key to navigating the situation is “a lot of assessment” and mitigating the impact. He called for a return to tariff free trade in civil aircraft equipment, reverting back to the 1979 agreement.
The company has maintained its guidance for 2025, however excluding the impact of tariffs, but includes the impact of integrating Spirit AeroSystems' work packages. It continues to expect an adjusted EBIT of around €7bn, a free cash flow before customer financing of around €4.5bn, and to deliver around 820 commercial aircraft.
Faury said: “We maintain the guidance that excludes tariffs which are adding complexity and remain uncertain in terms of implementation, scope and duration. We are closely monitoring and assessing the situation, but it is too early to quantify the impact today."
In maintaining its guidance, the company also said, “[Airbus] assumes no additional disruptions to global trade or the world economy, air traffic, the supply chain, its internal operations and ability to deliver products and services.” Faury clarified in the earnings call that the absence of tariff impact was due to the lack of a “stable and precise and determined scenario”. He added: “The direct impact could likely be contained in the current framework, if the current framework were to last until the end of the year.”
During the company's earnings call, Faury added: “Our direct financial exposure lies mainly with the cost increase of sub assemblies imported into our final assembly lines located in the US and China, with a caveat we might make later that things keep changing on the Chinese front.” He added that the new “volatile” tariffs are “literally changing by the day”.
Faury said the company is “proactively monitoring” the potential indirect impacts of tariffs, but that the supply chain has currently not been impacted.
“Our Q1 results demonstrate the progress we are making on our priorities across the business," said Faury. "We are ramping up production in line with our plan but the delivery profile will be backloaded, reflecting the specific supply chain challenges we are facing this year.”
The company delivered 136 commercial aircraft during the quarter. This included 106 A320 family aircraft, 17 A220s, four A330s, and nine A350s.
“The A320 Family programme continues to ramp up towards a rate of 75 aircraft per month in 2027," Airbus read in its report. “The company is stabilising the A330 monthly production rate at around four. Specific supply chain challenges, notably with Spirit AeroSystems, are currently putting pressure on the ramp up of the A350 and the A220. The company continues to target rate 12 for the A350 in 2028 and a monthly A220 production rate of 14 aircraft in 2026.”
Faury said there are “persisting tensions” on CFM engines for the A320 aircraft. As a result, the company had 17 gliders — or finished aircraft — without engines at the end of the first quarter.
“This situation will continue until the summer with a likely increased number of gliders due to missing CFM engines,” said Faury. “This will result in a rather soft delivery number for [the first half of 2025] before it normalises in the second half of the year to support the full year guidance.”
He later clarified in the call that the CFM situation would “get worse before it gets better”, supporting its full year delivery guidance, adding that deliveries for the second quarter would be “soft”.
Airbus' consolidated revenues for the quarter were up 6% to €13.5bn. The company's adjusted EBIT was up 8% to €624 million and reported EBIT down 22% to €473 million.
The company's commercial aircraft segment reported revenues of £9.5bn, up 4%, and an EBIT of £494 million, down 3%.
The European manufacturer's net income was up a third to €793 million, or €1.01 earnings per share (EPS), compared with €743 million, or €0.76 EPS, last year.
The company's free cash flow was a negative €296 million, improving from €1.8bn in the first quarter of 2024.
Gross commercial aircraft orders in the period totalled 280 aircraft, net 204 aircraft after cancellations. As of the end of March, the company's backlog totalled 8,726 commercial aircraft.
Airbus' commercial aircraft adjusted EBIT was €494 million, down slightly from €507 million.
As of the end of March, Airbus' net cash position was €11bn.