Airbus // Universal Registration Document 2021

2. Management’s Discussion and Analysis of Financial Condition and Results of Operations / 2.1 Operating and Financial Review

securing the ongoing ACF ramp-up and improving the industrial flow. At that time, Airbus discussed further ramp-up potential for the A320 programme beyond rate 63 per month with the supply chain, and saw a clear path to further increase the monthly production rate by one or two for each of the two years after 2021. On 8 April 2020, the Company announced its decision to adapt commercial aircraft production rates to 40 per month for the A320 Family in response to the new COVID-19 market environment. In 2020, Airbus delivered 431 A320neo Family aircraft. On A320, production rates were foreseen to gradually increase from 40 aircraft per month currently to 43 in the third quarter and 45 in the fourth quarter 2021. In 2021, Airbus delivered 459 A320neo Family aircraft. On 28 October 2021, the Company announced that it is working to secure the A320 Family programme ramp up and is on trajectory to achieve a monthly rate of 65 aircraft by summer 2023. For A320 Family production rates beyond 2023, the Company is still in the assessment phase and working with suppliers to potentially enable an increase above rate 65. A330 programme. In 2019, 53 A330 were delivered. Given overall customer demand for widebody aircraft, Airbus expected A330 deliveries of approximately 40 aircraft per year beginning in 2020 (prior to the outbreak of COVID-19). In 2020, 19 A330 were delivered. On 8 April 2020, the Company announced its decision to reduce commercial aircraft production rates to around two per month for A330 in response to the new COVID-19 market environment. In 2021, 18 A330 were delivered. On 28 October 2021, the Company announced that the recent commercial success of the A330 programme enabled a monthly rate increase from around two to almost three aircraft at the end of 2022. A220 programme. In 2019, A220 aircraft deliveries rose to 48 aircraft. Our focus continued to be on cost reduction as well as growing the backlog to support the ramp-up plan in Mirabel (Canada) and Mobile (US) where we targeted our first delivery in 2020. Order backlog stood at 495 aircraft as of 31 December 2019. In 2020, 38 A220 aircraft were delivered. Rates were expected to increase from four to five aircraft per month from the end of the first quarter 2021. In 2021, 50 A220 aircraft were delivered. On 28 October 2021, the Company announced the A220 production rate, which was at five aircraft a month, is expected to increase to around rate six per month in early 2022, with a monthly production rate of 14 envisaged by the middle of the decade. Defence export ban. Defence export licences to Saudi Arabia were suspended by theGermanGovernment until 31March 2020. A revised Estimate at Completion (EAC) for a customer contract was performed as of 31 December 2020, and the Company continues to engage with its customer to agree a way forward. The outcome of these negotiations is presently unclear but could result in further significant financial impacts. The year-end 2020 assessment remains unchanged as of 31 December 2021. Going concern and associated l iquidity measures. On 23 March 2020, the Company announced measures to bolster its liquidity and balance sheet in response to the COVID-19 pandemic, including a new €15 billion credit facility

On 8 April 2020, the Company announced its decision to adapt commercial aircraft production rates to six per month for A350 in response to the new COVID-19 market environment. Subsequently, the rate for A350 was further reduced to around five per month. In 2020, Airbus delivered 59 A350 XWB aircraft. Given the significant production rate reduction, the A350 programme did not reach breakeven with this level of deliveries. In 2021, Airbus delivered 55 A350 XWB aircraft. On 28 October 2021, the Company announced the A350 programme is expected to increase from around five to around six aircraft a month in early 2023. A400M programme. Developments on the A400M programme resulted in the recognition of revenues of €1.5 billion in 2019, €1.6 billion in 2020 and €1.4 billion in 2021. In 2019, 14 A400M aircraft were delivered. In total, the Company had delivered a total of 88 A400M aircraft as of 31 December 2019. On 13 June 2019, the Company concluded together with OCCAR and the Nations the negotiations on a global re- baselining of the programme. A contract amendment was signed by all parties, providing a revised aircraft delivery schedule, an updated technical capability roadmap and a revised retrofit schedule. Important certification milestones were achieved in 2019, in particular on critical Paratrooper Simultaneous Dispatch and Helicopter Air to Air refuelling capabilities. Technical modifications corresponding to the New Standard Operating Clearance (NSOC2) contractual standard were certified and qualified. However, NSOC2 Type Acceptance initially planned in 2019 was still pending due to ongoing discussions on some operational limitations. In the fourth quarter 2019, an update of the contract estimate at completion was performed and an additional charge of € 1,212 million recorded. This reflected mainly the updated estimates on the export scenario during the launch contract phase based on a revision of the market perspectives taking into account the current environment, including the suspension of the export licenses by the German Government and its consequences on potential prospects. It reflected as well some cost increases in particular for retrofit and an updated view on applicable escalation. As of 31 December 2021 the Company has delivered a total of 105 A400M aircraft including eight aircraft in 2021 and nine aircraft in 2020. The COVID-19 pandemic is weighing on the performance of development, production, flight testing, aircraft delivery and retrofit activities of the programme. The Company has continued with development activities toward achieving the revised capability roadmap. Retrofit activities are progressing in close alignment with the customer. In 2020, an update of the contract estimate at completion was performed and a charge of €63 million recorded reflecting mainly the variation of price escalation indexes. In 2021, an update of the contract estimate at completion has been performed and an additional charge of €212 million has been recorded. This reflects mainly the updated estimates on the delivery pattern of the launch contract and the associated impact on unabsorbed costs. Risks remain on the development of technical capabilities and associated costs, on aircraft operational reliability in particular with regard to power plant, on cost reductions and on securing export orders in time as per the revised baseline. A320 programme. In 2019, NEO aircraft deliveries rose by 43% year-on-year to 551 aircraft. The ramp-up continued for the Airbus Cabin Flex (“ ACF ”) version of the A321 with almost 100 more deliveries than in 2018. The Airbus teams were focused on

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Airbus / Registration Document 2021