Airbus // Universal Registration Document 2023

Risk Factors 1 Geopolitical, Global Economic and Financial Market Risks

As of the end of 2023, approximately 19,000 suppliers from more than 90 countries supply parts, components, systems and services to the Company. In 2023, the overall external sourcing volume of the Company was estimated at around € 49 billion. The Company requires its suppliers’ and subcontractors’ services in order to deliver its products and generate revenue and profit. Therefore financial, economic and geopolitical instability in any part of the world that would affect our suppliers or subcontractors, including conditions resulting in sharply rising inflation, increasing energy prices, their inability to obtain credit or even their insolvency, could impact the Company’s ability to meet its customer obligations in a satisfactory and timely manner. In addition, financial, economic and geopolitical instability affecting suppliers or subcontractors could impact such parties’ ability to meet their obligations under risk sharing agreements entered into with the Company. The lingering effects of the COVID-19 pandemic and the consequences of Russia’s invasion of Ukraine have likewise increased the Company’s exposure to supply chain risk. For further details, please refer to “Business and operations-related risks – Dependence on Key Suppliers and Subcontractors”. The behaviour of our customers and by extension, the demand for and supply of the Company’s products and services have been and may continue to be materially affected by global economic conditions. Geopolitical events (such as armed conflicts) or events like the COVID-19 pandemic leading to global or localised economic deterioration and resulting in a drop in air travel, could lead to protracted weak demand for commercial aircraft. Historically, the Company has experienced that order intake for commercial aircraft has shown cyclical trends, due in part to changes in passenger demand for air travel and the air cargo share of freight activity, which are in turn driven by a range of economic variables including gross domestic product (“ GDP ”) growth and private consumption levels. Likewise, demand for military and parapublic products may be affected by governmental budget constraints caused by economic pressure. As the size of the Company’s commercial aircraft business relative to its defence, space and government activities has grown, the latter’s ability to serve as an effective buffer to counter commercial cycles has been diluted. Protracted weak global economic conditions brought on by the above-described or other factors could therefore directly result in: – –financial distress among airlines and lessors, and potential bankruptcies within this market; – – requests by customers to postpone or cancel existing orders for aircraft (including helicopters) or decisions by customers to review their order intake strategy due to, among other things, lack of availability of credit in the financial markets to finance aircraft purchases or increases in operating costs, or weak levels of passenger demand for air travel and cargo activity more generally, which in each case could negatively impact the Company’s results of operations; – – variations in public spending for defence, homeland security and space activities, which may lead to the termination or reduction of future funding or to cancellations or delays

impacting existing contracts, each of which could negatively impact the Company’s results of operations; and – – an increase in the amount of sales financing that the Company is requested to provide to its customers to support aircraft deliveries, which are typically secured by the underlying aircraft itself and which entail exposure to the customer credit risk. See “Business and operations-related risks – Sales Financing Arrangements”. In addition, due to the lengthy terms of sales and supplier contracts, in the aerospace and commercial aircraft industry it is standard to include revision clauses in such contracts. Revision clauses can be based on one or multiple indices and therefore, can evolve due to changes in the underlying economic measures on which such indices are based, thereby potentially negatively impacting the Company’s results. The Company generally finances its manufacturing activities and product development programmes (particularly the development of new commercial aircraft), through a combination of cash flows generated by operating activities, customer advances, European governments’ refundable advances and risk-sharing agreements with subcontractors. In addition, the Company’s military-linked activities often benefit from government-financed research and development contracts. The Company may also elect to raise funds in the capital markets. Unfavourable or weak economic conditions, uncertainty or adverse trends leading to liquidity constraints or reduced availability of financing for the Company’s customers, suppliers, European and other governments, and other risk sharing partners may affect the Company’s ability to finance its product development programmes and raise funds in the capital markets. Please also refer to “Geopolitical, global economic and financial market risks – Liquidity” and “Business and operations-related risks – Availability of government and other sources of financing”. The Company’s financial results may also be negatively affected by gains or losses realised on the sale or exchange of financial instruments; impairment charges resulting from revaluations of debt and equity securities and other investments; interest rates; cash balances; and changes in fair value of derivative instruments. Periods of increased volatility in the financial markets and overall economic uncertainty increase the risk that actual amounts realised in the future on the Company’s financial instruments could differ significantly from the fair values currently assigned to them. Although the potential negative impact of global economic conditions has been thoroughly assessed and are continually monitored, the consequences thereof could have unforeseen material effects on the Company’s business, results of operations and financial condition, particularly to the extent they were to impact the Company’s commercial aviation activities or otherwise impact its access to financing.

Airbus Annual Report

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Universal Registration Document 2023