French aerospace manufacturer Safran is carefully monitoring its exposure to potential US tariffs as it aims to ramp up CFM's Leading Edge Aviation Propulsion (Leap) engine and spare parts production on growing demand from Boeing and Airbus, and airlines, respectively.
Safran has 18 sites in Mexico spanning production, maintenance repair and overhaul and engineering, with 14,000 employees on the ground. Its Canadian presence consists of seven industrial sites with more than 1,900 employees. In the US, Safran has operations in more than 24 US states with over 10,000 employees. Additionally, Safran is partnered with US' GE Aerospace through their CFM International joint venture, which produces the Leap engine.
Safran, therefore, is exposed to tariffs crossing in either direction over the US border, but chief executive Olivier Andries said on the company's full year results call today that it is too early to give a definitive impact without details about the scope of the tariffs. Andries pointed to the example of the Leap 1A engine, which is assembled in France but receives the engine core from GE in the US. A similar conundrum exists for the Leap 1B, which is assembled in the US but uses a turbine module delivered to the US from France, and a fan module from Mexico.
Safran last year delivered 1,407 Leap engines, down by 163 units from 1,570 deliveries in 2023, because of high-pressure turbine yield constraints on the 1A variant and reduced build rates on Boeing's 737 MAX affecting the 1B.
Original equipment deliveries across all other Airbus programmes increased on the year. A320neo nacelle deliveries rose by 7pc to 622 units, while those of A330neo nacelle moved up by 15pc to 62. Deliveries of landing gear sets for the A350 climbed by two units to 48, while those for Boeing 787 landing gear sets jumped by 37pc, or 11 units, to 41. A320 landing gear sets continued the widebody pattern, with deliveries up by 3pc to 601.
Deliveries of CFM's legacy engine, the CFM56, increased by 15pc to 60 engines, and those of high-thrust engines rose by 3pc to 195 units. Military M88 engine deliveries decreased by two units to 40.
Safran maintained Leap engine delivery guidance for 2025 at growth of up to 15-20pc over last year, inferring deliveries of 1,618-1,688. Supply chain capabilities, alongside tariffs, remain the key risks to this assumption. The certification of the new 1A HPT blade and approval of a new HPT blade for the Boeing variant slated in 2025 will support Safran's ramp-up.
