Changes Address Growing Financial Pressures

On October 16, Airbus confirmed plans to cut up to 2,500 jobs from its Space and Defense sector by mid-2026. The company has around 150,000 total employees worldwide.

Airbus clarified that the cuts are part of its strategy to streamline organizational efforts and build accountability in its Air Power, Space Systems, and Connected Intelligence services.

“Our [divisions] have been impacted by a fast changing and very challenging business context with disrupted supply chains, rapid changes in warfare and increasing cost pressure due to budgetary constraints,” stated Mike Schoellhorn, CEO of Airbus Defence and Space. “We want to shape the Division so it can act as a leading and competitive player in this ever-evolving market. This requires us to become faster, leaner and more competitive.”

This move follows nearly two years of stacking losses, including over $500 million from its A400M military transport plane due to problematic contracts, delays, technological issues, and a fatal test flight crash. Issues across several of Airbus’s satellite projects have also cost the manufacturer nearly $1 billion.

These struggles give Boeing, Airbus’s main competitor, some company in its misery. Boeing has been leading the struggle bus recently, with problems from crashes to disappearing doors to ongoing machinist strikes. Its Defense, Space, and Security division reported a $2 billion loss in the third quarter of 2024 stemming from Starliner and KC-46 tanker delays.

Less than a week before Airbus announced its job cuts, Boeing revealed that it would be dropping 17,000 laborers. Both mega manufacturers are now in the spotlight to see if they will be able to recover their aerospace reputations, especially as SpaceX moves front and center.

Despite the two being strong competitors, Airbus has steadily outpaced Boeing in aircraft orders and profits for five years straight.

“Airbus has a long track record of acting as a responsible employer in difficult situations and this time will be no different. It is clear though that we must adapt if we want to champion our industry and lead Europe’s ecosystem of Defence Aerospace,” Schoellhorn concluded.

FMI: www.airbus.com