Airbus to cut up to 2,500 jobs in Defence and Space division

Paris — Airbus announced plans on Wednesday to cut up to 2,500 jobs in its Defence and Space division after spending months taking a deep dive into heavy losses in its satellites business.

The European aerospace group said it aimed to carry out the cuts, which represent 7% of the workforce in its second-largest division, by mid-2026 after talks with unions but would hold off taking an immediate restructuring charge.

Airbus builds satellites and transporters and has shares in European missile, fighter, and space launch programmes.

It has been hit by €1.5bn of charges in space systems in recent quarters, led by the hi-tech OneSat project, and delays and rising costs in defence.

The job cuts, first reported by French news agency AFP, come on top of a more than year-long efficiency review in the defence and space business, code named ATOM.

Mike Schoellhorn, CEO of Airbus’ second-largest division by revenue, said it was time to take further steps in an “increasingly difficult space market”.

“This requires us to become faster, leaner and more competitive,” he said in a statement.

Airbus has been drawing up specific turnaround plans for its struggling Space Systems business without waiting for the outcome of recent satellite consolidation talks that include Italy’s Leonardo as well as France’s Thales.

Job cuts will also be felt in the Germany-based defence unit’s headquarters.

Airbus is based in France with core operations also in Germany, Britain and Spain. Governments of the four host nations have been briefed on the restructuring plans, sources said.

Airbus now faces months of negotiations with unions and host nations on where the axe will fall in hi-tech manufacturing, a politically sensitive topic that could lead to some fine-tuning.

“The horse-trading is starting now,” a person familiar with the discussions said.

Airbus is bracing for new provisions to reflect the costs of the restructuring but these will not be taken immediately, with the company still in the early stages of assessing the impact, analysts were told in a webcast ahead of results due on October 30.

The plane maker has been ploughing through its books to try to gain a complete picture of losses embedded in complex forward services contracts for satellites such as the reprogrammable OneSat.

Group CEO Guillaume Faury said earlier this year that Airbus was looking at opportunities to create scale in defence, space and particularly satellites where traditional players have been heavily disrupted by the success of new constellations.

European countries hiked defence spending after Russia’s invasion of Ukraine in 2022 but some of the rearmament spending has gone to non-European suppliers and the most urgent needs do not involve the large platforms on which Airbus is most focused.

“There has been no upside for military aircraft producers from Ukraine; the area where the upside is occurring is in munitions and missiles,” Agency Partners analyst Sash Tusa said.

Reuters