Airbus Soaring Thanks to Effective Supply Chain Management

Airbus' A320 series is on the brink of surpassing Boeing’s iconic 737, highlighting significant developments in global supply chains and production efficiencies.

As per an aviation consultancy report from Cirium, the A320 series trails by just 20 units, signalling a potential overtaking of the 737.

The implications of this contest extend beyond mere statistics. It underscores the critical role that efficient supply chains play in maintaining production rates, adhering to quality standards and advancing future aircraft designs.

Supply chain dependencies

Both Boeing and Airbus are heavily reliant on intricate global supply chains.

Each aircraft incorporates thousands of components, ranging from complex flight control systems to sophisticated engines, all of which must be delivered according to strict timelines and standards.

This dependence amplifies the importance of evaluating production numbers to discern the operational health of each manufacturer’s supply chain.

Boeing is making strides to boost its 737 MAX production output from 38 to 42 units monthly, with plans to further increase to 47.

“We’re pretty confident in our ability to move from 38 to 42," said Boeing Chief Executive Kelly Ortberg during the Bernstein Strategic Decisions Conference.

"Now, after that, we do have subsequent rate increases in our plan, and they will typically be in that five-per-month rate. That feels like a good increment. So, the next one would be to 47.”

Boeing's commitment to reducing production defects by 30% reflects in improved customer satisfaction regarding aircraft quality at delivery.

This enhancement in production quality is part of Boeing’s strategic initiatives to restore trust post-Federal Aviation Administration (FAA) imposed production caps following earlier safety issues.

Challenges and adaptability

Meanwhile, Airbus is demonstrating its capacity to handle large-scale production. Its approach to closing the once-significant gap with Boeing reflects a flexible and responsive supply chain.

By August, Airbus reported 12,155 lifetime deliveries of the A320 series, narrowing the gap with Boeing to a mere 20 aircraft.

In the aerospace sector, maintaining production momentum requires a balance of speed, safety, reliability and supplier stability.

After the grounding of Boeing’s 737 MAX, the company had to shift focus towards quality, thus temporarily sacrificing speed to mitigate risks. The adjustment necessitated a corresponding shift in the supply chain to adapt, affecting delivery timelines but enhancing overall safety.

Still, Airbus has been met with challenges, as evidenced by the A320neo’s issues with Pratt & Whitney’s fuel-efficient engines. Problems with high-tech coatings have increased maintenance operations, emphasising the critical impact of supply chain bottlenecks on global fleet management.

Future outlook

The continuous demand for narrowbody jets, which optimally serve short and medium-haul routes, perpetuates this supply chain pressure.

The Boeing and Airbus models dominate global air travel due to their efficiency in operation. However, managing production relative to demand poses risks of either financial loss from overproduction or customer dissatisfaction due to shortages.

Boeing's production caps, imposed by regulatory oversight from the FAA, and Airbus’s strategic planning highlight the complex relationship between innovation, production scaling and regulatory compliance.

Both companies are cautious about implementing full-scale redesigns of their narrowbody aircraft, opting instead for incremental updates to minimise disruption to their extensive supplier networks.

As both aerospace giants prepare for the next generation of single-aisle jets, the procurement sector must closely watch how each innovates within its supply chain. Airbus’s investment in future designs, like the potential open-rotor engine, showcases its readiness to lead in technological development.

“I have a lot of focus on preparing that next-generation of single aisle," said CEO Guillaume Faury at the Paris Air Show. "We are very steady and very committed to this."

The race between Airbus and Boeing for the title of most-delivered airliner is more than simply a competitive tally.

Instead, it represents the culmination of decades of strategic planning, investment in robust supply chains and the delicate balancing of innovation with operational feasibility.