Airbus chief executive Guillaume Faury predicts passengers will end up paying higher fares if the aerospace industry is forced to upend global supply chains in the face of tariffs.
Faury says that if tariffs imposed by different trading blocs become permanent, suppliers will respond by moving factories so components “cross borders much less often”.
This will see the sector shift from an industry with a “globalised ecosystem”, where parts are made where it makes most sense, to one that is more “regionalised”.
Such a “de-optimised” set-up will add additional costs and “in the end passengers will pay more for tickets”, he said, speaking at the Paris Air Forum on 13 June.
Faury says Airbus is not yet “thinking about regionalisation” and is “adapting” to the current situation. In the short-term, tariff increases are being spread throughout the industry, he notes.
Having to relocate production for any company will be “very expensive”, Faury says.
He is hopeful the entire industry can convince politicians of the imperative to return to tariffs on aerospace products that are “near zero”, as has largely been the case since 1979.
However, he says, if there is no willingness to compromise on the part of the USA then Europe will have to “show its teeth a little”.
