Feeling the pain – will the diving dollar cause Airbus to crash?

Feeling the pain – will the diving dollar cause Airbus to crash? The rising Euro-US dollar exchange rate has now taken Airbus ‘beyond the pain barrier’ according to this excellent short news report on BBC online. With the dollar stumbling to record lows against the Euro in recent days, it is becoming more difficult for Airbus to remain competitive in the global market for new aircraft. They have already instigated a huge cost-reduction programme but this is unlikely to be enough. And it goes against the grain to be looking at radical cost reductions at a time when orders for new planes are actually quite strong. The problem is mainly the scale and pace of changes in the exchange. CEO Thomas Enders was reported as saying back in September that ‘every time the dollar loses 10 cents we lose one billion euros.”’ Airbus fears ‘weak-dollar death’ http://news.bbc.co.uk/1/hi/business/7108146.stm The article is a good example of how significant exchange rate movements can affect the price and cost competitiveness of producers in one country when facing up to a giant rival (in this case Boeing) across the Atlantic Airbus CEO says dollar slide “life-threatening” (The Guardian)