In late May, Supply Chain Matters noted that commercial aircraft producer Airbus, in response to increased orders, was actively evaluating a further ramping-up of its A320 family production volume cadence. In February, the stated plan called for increasing monthly production from the current 42 to 50 aircraft per month by early 2017. However, evaluation was underway to assess if the global supply chain could support a ramp to 60 aircraft per month.
Late last week, the company formally announced that it would indeed increase the A320 production rate to 60 aircraft per month by the middle of 2019. To further enable this ramp-up, Airbus will extend an additional production line at its Hamburg Germany manufacturing facility, as well as harmonize some production processes at its Toulouse France facility. As of September, Airbus reported backlog orders for the single-aisle A320 aircraft family amounting to 5502 aircraft.
While Airbus scrutinized suppliers for ability to support such a plan, there are still concerns regarding CFM International, the joint venture among General Electric and Safran SA, which is a major supplier for its new LEAP family of advanced aircraft engines for both Airbus and rival Boeing. As of September, nearly 4300 of Airbus backlogged orders were designated for the A320neo (new-engine option) model, powered by the new CFM LEAP engines.
During the summer, company management publically expressed concern about each OEM’s aggressive ramp-up schedules. Through September, CFM had booked orders for 9550 LEAP engines. If one were to conservatively assume that this backlog was spread out over the next eight years, CFM would have to sustain an average production rate of nearly 100 engines per month. The reality of order and delivery timing skew would likely make that monthly volume number higher. That is quite a challenge, one that obviously requires a significant investment in resources, capacity and consistent quality focused processes.
As Supply Chain Matters has previously noted, the realities of multi-year order backlogs are now reaching the point of all-in commitment. These are record-breaking production volumes and massive scale that this industry has never experienced at a regional or global-wide perspective. Technology will play a critical role along with people, since the aerospace industry is facing the same reality of highly experienced older employees about to retire. Processes, systems, risk mitigation, talent and supplier management practices are sure to be tested in the continuing journey that is unfolding.