European aircraft manufacturer Airbus announced on Wednesday that it plans to cut up to 2,500 jobs in its defense and space division due to losses in its satellite business. The defense and space division is Airbus’s second-largest business unit, and the layoffs amount to 7% of the workforce in the division.
The European aerospace group stated that after negotiations with the unions, the job cuts are expected to be completed by mid-2026. The division currently has 35,000 employees and contributed around 20 billion euros (22 billion dollars) to Airbus’s revenue of 65.4 billion dollars last year.
Airbus produces satellites and transport systems, and holds significant stakes in European missile, combat aircraft, and space launch projects. In recent quarters, the company incurred costs of 1.5 billion euros (approximately 16.3 billion dollars) in space systems, including the high-tech OneSat project, and faced delays and cost increases in its defense business.
Before announcing the job cuts, Airbus conducted over a year of efficiency reviews of its defense and space operations under the codename “ATOM,” as reported by Agence France-Presse (AFP).
Mike Schoellhorn, CEO of the defense and space division, stated that in the “increasingly challenging space market,” it is now necessary to take further actions. “This requires us to become faster, leaner, and more competitive,” he mentioned in a statement.
Airbus is developing specific plans to turn around its struggling space systems business without waiting for the outcome of recent satellite integration negotiations involving companies like Leonardo from Italy and Thales from France. The layoffs will also affect the headquarters of the defense division in Germany.
Headquartered in France, Airbus has core operations across Germany, the UK, and Spain. Sources revealed that the governments of the four host countries have been informed of the restructuring plan.
Airbus is currently engaging in months-long negotiations with unions and host countries to determine the scope of job cuts in the high-tech manufacturing industry. In July, Reuters reported that Airbus had initiated an emergency cash control plan in its defense and space division, with management describing the cost situation as “severe.”
Guillaume Faury, CEO of the group, mentioned earlier this year that Airbus is seeking opportunities to expand its presence in defense, space, and particularly the satellite sector. In these areas, traditional enterprises have been severely disrupted by the success of emerging players.