Airbus says cost cuts in pipeline, no extra program

September 19, 2016 4:22 AM EDT

People speak together near a logo of Airbus Group during the Airbus annual news conference in Colomiers, near Toulouse, January 13, 2015. REUTERS/Regis Duvignau/File Picture

Find out which companies are about to raise their dividend well before the news hits the Street with's Dividend Insider Elite. Sign-up for a FREE trial here.

PARIS (Reuters) - Airbus Group (NYSE: AIR) confirmed on Monday it is planning cost cuts as it embarks on a project to introduce more digital methods into its operations, but denied a report it is working on new cuts as a result of cost overruns on its largest planes.

The Financial Times newspaper reported earlier that Airbus was preparing a new restructuring and cost-cutting plan that would be unveiled next month in a drive to offset expensive delays in some of its programs.

The newspaper said the plan was not yet finalised and could involve group-wide job cuts.

A spokesman said Airbus was not working on a new program but was focused on the "digitalisation project to modernize Europe's largest aerospace group" announced in July.

"As was announced by Tom Enders (in July), the envisaged cost-cutting aims at being a contribution to value creation and in particular to the digital transformation at Airbus Group."

"It is misleading to interpret this being a reaction to any short term business issues," he said.

Airbus has said it plans to introduce digital methods to overhaul the way it builds and delivers planes from design to production and product support.

"And therefore we will look into the structural set-up of the group to overlap synergies – further cost reductions, particularly between group of a corporate level and the divisional level," the spokesman said.

He said this would set the groundwork to achieve the group's earnings and cashflow targets and growth potential "for 2017 and beyond."

(Reporting by Paris bureau; Editing by Mark Potter)

Serious News for Serious Traders! Try Premium Free!

You May Also Be Interested In

Related Categories


Related Entities

Layoffs, Earnings

Add Your Comment