By Dow Jones Business News,
July 30, 2014, 06:17:00 AM EDT
By Robert Wall
Airbus Group NV (AIR.FR) Chief Executive Tom Enders said the company isn't concerned about supply disruptions of
titanium from Russia even as the European Union imposes new sanctions on Russia.
Airbus's relationship with Russian company VSMPO is "very stable," Mr. Enders said. Airbus purchases titanium raw
material and forgings from VSMPO, the world's biggest titanium supplier.
"I do not expect the flow of it will be cut off short of all-out war," Mr. Enders told analysts Tuesday when
presenting the company's first-half results.
The European Union is imposing further sanctions on Russia over the country's efforts to destabilize Ukraine. The
measures gained added impetus after the July 17 downing of Malaysia Airlines Flight 17 that Western officials blame on
pro-Russian separatists in eastern Ukraine. Russia denies the charge.
Airbus's commercial plane unit and rival Boeing Co. ( BA ) rely heavily on titanium from Russia to build their jets.
Titanium is increasingly important on commercial airliners as Airbus and Boeing increase their use of composites.
The structure of Airbus's new A350 model, now in flight testing, has 14% titanium content. Titanium has properties
that make it particularly useful in bridging composite and aluminum structures.
Mr. Enders said VSMPO is a "key strategic partner."
Airbus for at least two months has been examining potential mitigation actions should disruptions arise. Gunther
Butschek, chief operating officer for the Airbus commercial airplane unit, said in May the company was in talks with
potential alternative suppliers.
Mr. Enders said the company is continuing to explore mitigation actions, while expressing "strong confidence" in the
Write to Robert Wall at firstname.lastname@example.org
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