We had an opportunity this afternoon in Toulouse to visit the A350 FAL.  There are a number of aircraft in various stages of assembly.  Of those we saw, the highest MSN we saw was #28.  Airbus claims there are four outside the FAL being put through ground tests.

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Airbus also advised the first A350-1000 parts are to arrive very soon.  The FAL is quite different now compared to our previous visit.  Where there were empty bays there are now aircraft and parts.

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Since we were able to see #28 (Finnair) it appears that Airbus is slowly ramping up production.  Deliveries on the other hand appear slower than what we expected.  We were advised the Final Assembly Line is close to assembling 3 aircraft per month.  With only two deliveries since December, the assembled aircraft must be accumulating somewhere.

Customers have to be eager to get their hands on the aircraft.  It is important to Airbus to produce aircraft on time to avoid penalties for being late in deliveries, and with #28 in process, it is clear that more aircraft than the 3 already delivered and 6 in the flight test fleet are in process.  Airbus provided guidance that it will deliver 17 more aircraft by year end, a rate of 2.2 per month, and indicated that production will reach 10 per month in early 2018.

The Bottom Line

We expect a slower ramp-up than previously scheduled, from 2.2 per month this year to 5 per month in 2016, and then to 8 per month in 2017 before finally reaching the 10 per month target in early 2018.  Despite initial deliveries being quite slow, the A350 production line is clearly ramping up, and we can expect deliveries at a steady pace through the remainder of 2015.

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