Airbus (AIR.PA) boosted its liquidity with a 15 billion euro ($16 billion) expanded credit facility on Monday while suspending its 2020 outlook in response to the coronavirus crisis that has grounded much of the global airlines fleet.
The European planemaker also joined U.S. rival Boeing (BA.N) in scrapping its 2019 dividend, worth a total of 1.4 billion euros. It also said it would suspend the voluntary top-up of staff pension schemes.
“These measures are designed to protect the future of Airbus and to ensure we can resume normal business or future business as soon as the situation improves,” CEO Guillaume Faury told reporters.
Airbus has not drawn down any credit lines and said it had enough liquidity to cope with the coronavirus with some 30 billion euros worth of liquidity available.
“We have a lot of runway with this 30 billion,” Chief Financial Officer Dominik Asam said.
Airbus shares fell 10% versus a wider French CAC40 market index .FCHI down by around 4%.
Faury called for “strong government help” for airlines across the world that have been forced to ground fleets, as well as for distressed aerospace suppliers.
The French government has offered 300 billion euros of loan guarantees to help companies, but Airbus said its own credit facility was commercial and did not fall under the scheme.
Boeing, already battered by the year-old grounding of its 737 MAX airliner, last week called for $60 billion in U.S. support for the U.S. aerospace sector.
Faury said it would become increasingly difficult to deliver jets and some would be stored. Most airlines continue to pay deposits even though many have called for deferrals, he said.
Airbus said it would use customer financing “very selectively” to help distressed airlines and that it expected leasing companies, which are involved in almost half of its deliveries, to play their role as a “shock absorber”.
Airbus also said it had identified operational measures to save cash as it resumed partial production at factories in France and Spain after a four-day shutdown.
Airbus, which sources say had been producing 58 single-aisle jets a month before the crisis, declined to say at what rate it would resume output.
Factories have installed extra spacing between workers and shorter shift times to allow for sterilizing tools.
Its immediate goal is to maintain parts flowing from a fragile supply chain at a sustainable rate, Faury said.
“We need to stabilize and see from what base we can restart,” he told analysts.
Industry executives say shortages are beginning to emerge in the supply chain and some contractors have paused production.
Germany’s MTU Aero Engines, which is a supplier to Pratt & Whitney (UTX.N) engines used on many Airbus single-aisle jets, said it would halt output for three weeks from March 30.