Registration
Document

2018

Registration
Document
Airbus SE is a European public company (Societas Europaea),
with its seat in Amsterdam, The Netherlands, which is listed in
France, Germany and Spain.
As a result of the relabelling to a single Airbus brand, Airbus SE
together with its subsidiaries is referred to as “the Company”
and no longer the Group. The segment formerly known
as “Airbus Commercial Aircraft” is referred to as “Airbus”.
See “— Management’s Discussion and Analysis of Financial
Condition and Results of Operations — 2.1.1.2 Reportable
Business Segments”.
In addition to historical information, this Registration Document
includes forward-looking statements. The forward-looking
statements are generally identified by the use of forward‑looking
words, such as “anticipate”, “believe”, “estimate”, “expect”,“intend”, “plan”, “project”, “predict”, “will”, “should”, “may” orother variations of such terms, or by discussion of strategy.
These statements relate to the Company’s future prospects,
developments and business strategies and are based on
analyses or forecasts of future results and estimates of amounts
not yet determinable. These forward-looking statements
represent the view of the Company only as of the dates
they are made, and the Company disclaims any obligation
to update forward-looking statements, except as may be

02

Airbus / Registration Document 2018

otherwise required by law. The forward-looking statements inthis Registration Document involve known and unknown risks,
uncertainties and other factors that could cause the Company’s
actual future results, performance and achievements to differ
materially from those forecasted or suggested herein. These
include changes in general economic and business conditions,as well as the factors described under “Risk Factors” below.
This Registration Document was prepared in accordancewith Annex 1 and 2 of Commission Delegated Regulation (EU)2019/980, filed in English with, and approved by, the Autoriteit
Financiële Markten (the “AFM”) on 29 July 2019 in its capacity
as competent authority under Regulation (EU) 2017/1129(the “Prospectus Regulation”).
The AFM only approves this Registration Document asmeeting the standards of completeness, comprehensibility
and consistency imposed by the Prospectus Regulation andsuch approval should not be considered as an endorsementof the issuer that is the subject of this Registration Document.
This Registration Document may be used for the purposesof an offer to the public of securities or admission of securities
to trading on a regulated market if completed by amendments,
if applicable, and a securities note and summary approvedin accordance with the Prospectus Regulation.

Risk Factors

1

Information on the Company’s Activities

2

Management’s Discussion and Analysisof Financial Condition and Results of Operations

3

General Description of the Company
and its Share Capital4

Corporate Governance

5

General Information

Airbus / Registration Document 201803

Contents

Registration Document
2018

Risk Factors

07

1.
2.
3.
4.

Financial Market Risks
Business-Related RisksLegal Risks
Environmental, Health and Safety Risks

08
12
18
21

Information on the Company’s Activities

23

1
1.1
1.1.1
1.1.2
1.1.3
1.1.4
1.1.5
1.1.6
1.1.7
1.1.8

Presentation of the Company
24
Overview
24
Airbus (Commercial Aircraft)
28
Helicopters36
Defence and Space
39
Investments
45
Insurance
46
Legal and Arbitration Proceedings
46
Non-Financial Information
48

2Management’s Discussion
and Analysis of Financial Condition
and Results of Operations71

2.1
Operating and Financial Review72
2.1.1 Overview73
2.1.2 Significant Accounting Considerations,
Policies and Estimates76
2.1.3 Performance Measures77
2.1.4 Results of Operations82
2.1.5 Changes in Total Equity(Including Non-Controlling Interests)
87
2.1.6 Liquidity and Capital Resources
88
2.1.7 Hedging Activities
91

04

Airbus / Registration Document 2018

2.2

Financial Statements

92

2.3

Statutory Auditor Fees

92

2.4

Information Regarding the Statutory Auditor

93

REGISTRATION DOCUMENT 2018

3

4

General Description of the Company
and its Share Capital95

Corporate
Governance117

3.1
3.1.1

4.1
Management and Control
4.1.1 Corporate Governance Arrangements
4.1.2 Dutch Corporate Governance Code,“Comply or Explain”
4.1.3 Enterprise Risk Management System
4.1.4 Internal Audit

General Description of the Company
96
Commercial and Corporate Names,
Seat and Registered Office96
3.1.2 Legal Form
96
3.1.3 Governing Laws and Disclosures96
3.1.4 Date of Incorporation and Duration of the Company 97
3.1.5 Objects of the Company
98
3.1.6 Commercial and Companies Registry
98
3.1.7 Inspection of Corporate Documents
98
3.1.8 Financial Year
98
3.1.9 Allocation and Distribution of Income98
3.1.10 General Meetings
99
3.1.11 Disclosure of Holdings100
3.1.12 Mandatory Disposal
101
3.1.13 Mandatory Offers
102
3.2
3.2.1
3.2.2
3.2.3

General Description of the Share Capital
103
Issued Share Capital
103
Authorised Share Capital
103
Modification of Share Capitalor Rights Attached to the Shares103
3.2.4 Securities Granting Accessto the Company’s Share Capital104
3.2.5 Changes in the Issued Share Capital
105
3.3
3.3.1
3.3.2
3.3.3
3.3.4
3.3.5
3.3.6
3.3.7

Shareholdings and Voting Rights
106
Shareholding Structure at the End of 2018106
Relationships with Principal Shareholders107Form of Shares
109
Changes in the Shareholding of the Company
110
Persons Exercising Control over the Company
110
Simplified Group Structure Chart
110
Purchase by the Company of its Own Shares
112

3.4
3.4.1
3.4.2
3.4.3
3.4.4

Dividends
114
Dividends and Cash Distributions Paid
114
Dividend Policy of the Company
114
Unclaimed Dividends114
Taxation
114

118
118
137
138
139

4.2

Interests of Directors and Principal
Executive Officers140
4.2.1 Remuneration Policy
140
4.2.2 Long-Term Incentives Granted to the Chief
Executive Officer152
4.2.3 Related Party Transactions
153
4.3
4.3.1
4.3.2
4.3.3

Employee Profit Sharing and Incentive Plans 153
Employee Profit Sharing and Incentive Agreements 153
Employee Share Ownership Plans
153Long-Term Incentive Plans
155

5

General Information

161

5.1

Entity Responsible
for the Registration Document

5.2

Statement of the Entity Responsible
for the Registration Document

162

5.3

Information Policy

162

5.4

Undertakings of the Company regarding
Information163

5.5

Significant Changes

163

5.6

Statement on Approval

163

162

Airbus / Registration Document 201805

Risk Factors

06

Airbus / Registration Document 2018

Risk Factors
1.

Financial Market Risks

08

2.

Business-Related Risks123.

Legal Risks

18

4.

Environmental, Health and Safety Risks

21

Airbus / Registration Document 201807

Risk Factors /1 Financial Market Risks

The Company is subject to the risks and uncertainties described below that may materially affect its business,
results of operations and financial condition. These are not the only risks the Company faces. Additional risks anduncertainties not presently known to the Company or that it currently considers immaterial may also impair its
business and operations.

1.

Financial Market Risks

Global Economic Conditions
The Company’s business, results of operations andfinancial condition are materially affected by global
economic conditions.
Market disruptions and significant economic downturns may
develop quickly due to, among other things, crises affecting
credit or liquidity markets, regional or global recessions, sharp
fluctuations in commodity prices (including oil), currency
exchange rates or interest rates, inflation or deflation, sovereign
debt and bank debt rating downgrades, restructurings ordefaults, or adverse geopolitical events (including the impactof Brexit, discussed below and global policy including in the
US, European Union, China). The current US administration
has introduced greater uncertainty with respect to US tax andtrade policies, tariffs and government regulations affecting trade
between the US and other countries. Such measures may affectcountries where our customers and suppliers are located orwhere the Company has an operational presence or to which
its financing activities are linked. See “ – Risk Factors – Financial
Market Risks – The Company’s business, results of operations
and financial condition could be materially affected by Brexit”
and “– Risk Factors – Business-Related Risks – Availability ofGovernment and other Sources of Financing”.
The Company’s global presence includes France, Germany,
Spain and the United Kingdom (“UK”), fully-owned subsidiaries
in the United States (“US”), China, Japan, India and in the
Middle East, and spare parts centres in Hamburg, Frankfurt,
Washington, Beijing, Dubai and Singapore. The Company also
has engineering and training centres in Toulouse, Miami, Mexico,
Wichita, Hamburg, Bangalore, Beijing and Singapore, as well as
an engineering centre in Russia. There are also hubs and field
service stations around the world. The Company also relies on
industrial co-operation and partnerships with major companies
and a wide network of suppliers. This global presence entails therisk of being affected by weak market and economic conditions
in particular in Europe, the US and Asia where it manufactures
and to which it sells the majority of its products.
As of 31 March 2019, the Company’s workforce amounted to135,468 employees of which 15,300 employed outside our core
countries. In terms of nationalities, 36.3% of the Company’s
employees are from France, 31.5% from Germany, 9.0% fromthe UK and 9.9% from Spain. US nationals account for 1.8% of
employees. The remaining 11.6% are employees coming froma total of 136 other countries. In total, 90.7% of the Company’s
active workforce is located in Europe on more than 100 sites.

08

Airbus / Registration Document 2018

It is a priority to ensure that the Company can attract, develop
and retain a world-class competent, motivated and flexible
workforce, which fits current and future business requirementsin each of the countries in which we have a presence. A change
in economic conditions in any of the geographies in which wehave significant numbers of employees or key employees may
therefore impact our ability to compete effectively for employees
in such countries.
More than 12,000 main suppliers from more than 100 countries
supply parts, components or sub-systems to Airbus. In 2017, theoverall external sourcing volume of Airbus was valued at around€ 52 billion. We require our supplier’s and subcontractors’
services in order to deliver our products and generate revenue
and profit. Therefore financial instability in any part of the worldthat would affect our suppliers or subcontractors, including
financial conditions resulting in their inability to obtain credit
or even insolvency, could impact the Company’s ability tomeet its customer obligations in a satisfactory and timely
manner. In addition, financial instability affecting suppliers or
subcontractors could impact such parties’ ability to meet their
obligations under risk sharing partnership agreements enteredinto with the Company.
The behaviour of our customers and by extension, the demandfor, and supply of, the Company’s products and services may bematerially affected by global economic conditions. Historically,
the Company has experienced that order intake for commercial
aircraft has shown cyclical trends, due in part to changes inpassenger demand for air travel and the air cargo share of freightactivity, which are in turn driven by a range of economic variables
including gross domestic product (“GDP”) growth and private
consumption levels. A downturn in economic factors driving
our commercial airline business, could lead to a weakening
demand for our commercial aircraft. The significant growth of
our commercial aircraft business relative to our Defence, Spaceand Government activities has diluted the latter’s ability to serveas an effective tool to counter commercial cycles.
Demand for military and parapublic products may be further
affected by governmental budget constraints caused byeconomic pressure.

REGISTRATION DOCUMENT 2018
Risk Factors /1 Financial Market Risks

Therefore weak global economic conditions could directly
result in:

The Company’s business, results of operations andfinancial condition could be materially affected by Brexit.

by customers to postpone or cancel existing orders--requests
for aircraft (including helicopters) or decisions by customers

On 29 March 2017, the UK triggered Article 50 of the Lisbon
Treaty, the mechanism to leave the European Union (“Brexit”),
before having achieved a roadmap for the complex negotiations.
The full impact of Brexit on our business, results of operations andfinancial condition will only become clear once the negotiations
between the European Union and the UK regarding withdrawal
have clarified the general nature of the post-Brexit relationship.
However, the Company’s business and supply chain in particular
may be materially affected by this uncertainty and by potentiallydivergent national laws and regulations between the European
Union and the UK.

to review their order intake strategy due to, among otherthings, lack of adequate credit supply from the market tofinance aircraft purchases or change in operating costs or
weak levels of passenger demand for air travel and cargo
activity more generally, which could negatively impact theCompany’s results of operations;variations in public spending for defence, homeland security
and space activities, which may lead to termination or reductionof future funding or cancellations or delays impacting existing
contracts which could negatively impact the Company’s
results of operations;an increase in the amount of sales financing that the Company
must provide to its customers to support aircraft purchases,
thereby increasing its exposure to the risk of customer defaults
despite any security interests the Company might have in theunderlying aircraft. See “— Risk Factors – Financial Market
Risks – Sales Financing Arrangements”.

---

In addition, in the Commercial Aircraft industry it is the industry
standard to include, revision clauses in sales and suppliercontracts due to the long terms of such contracts. Such revision
clauses can be based on one or multiple indices and therefore
can evolve due to changes in economic measures on whichsuch indices are based, thereby potentially negatively impacting
the Company’s results.
The Company generally finances its manufacturing activities
and product development programmes, and in particular thedevelopment of new commercial aircraft, through a combinationof flows generated by operating activities, customer advances,
European Governments’ refundable advances and risk-sharing
partnerships with subcontractors. In addition, the Company’s
military activities benefit from government-financed research anddevelopment contracts. If necessary, the Company may raise
funds in the capital markets. Weak economic circumstancesleading to liquidity constraints or reduced availability of financefor the Company’s customers, suppliers, European and othergovernments, and other risk sharing partners may affect
the Company’s ability to finance its product development
programmes and raise funds in the capital markets.
The Company’s financial results could also be negatively
affected depending on gains or losses realised on the saleor exchange of financial instruments; impairment charges
resulting from revaluations of debt and equity securities andother investments; interest rates; cash balances; and changes
in fair value of derivative instruments. Increased volatility inthe financial markets and overall economic uncertainty would
increase the risk of the actual amounts realised in the future on
the Company’s financial instruments differing significantly fromthe fair values currently assigned to them.
Although the potential negative impact of global economic
conditions cannot reasonably be assessed, the consequences
thereof could have a material effect on the Company’s business,
results of operations and financial condition, and in particular
if these were to impact the Company’s commercial aviation
activities or otherwise impact its access to financing.

The critical issues amongst others are the increased cost basedue to trade procedures, airworthiness efforts and difficulty
to move people. For trade procedures (non-tariff cost) alone,an OECD study estimates the range of the recurring extra
cost between 2% and 15% of overall trade. Because of theunprecedented and evolving nature of Brexit it is difficult toestimate the cost impact it may have on the company. The
Company recently generated a UK turnover of approximately£ 6 billion. Greater restrictions on the import and export of goods
and services between the UK and the European Union in which
the Company operates along with increased regulatory andlegal complexities may lead to disruptions and greater costsin the Company’s operations and supply chain. The Company
has more than 2,000 suppliers in the UK and an integrated
supply chain with parts crossing the Channel multiple times.
More than 10,000 original aircraft parts originate in the UK. The
Company’s supply chain is operated on a just-in-time basis
relying on frictionless trade today provided by the combinationof the EU Customs Union and Single Market rules. Changes incustoms regime between the UK and the European Union could
result in significant changes at borders and customs controls.
An insufficient level of preparedness for such changes could
significantly delay the import and export of goods including
goods which are transferred between Airbus (and its suppliers’)
entities in the UK and Airbus (and its suppliers’) entities in theEuropean Union, which may have a direct industrial and cost
impact.
The design, production, maintenance, repair and overhaul anduse of parts originating from UK aerospace companies follow
tight regulations controlled by the UK certification authority
within EASA, who delivers, for example, necessary Organisation
Approval (DOA), Production Organisation Approval (POA) andMaintenance Organisation Approval (MOA). In the absenceof a Brexit agreement, UK aerospace companies may not becovered anymore under existing regulatory approvals including
EASA approvals. To secure transition without disruption, UK
companies shall transfer their DOA, POA and MOA into the
EU-27 and/or adhere to EASA’s third country approval scheme.
Airbus has four major engineering and manufacturing facilities in
the UK, 14,000 employees at 25 sites. Our people make 80,000
business trips between the UK and the European Union a year
and we have 1,900 expatriates.
The Company employs a substantial amount of highly skilledemployees in the UK. Limitations on the free movement of people
and skilled labour could negatively affect competitiveness, inparticular compared to market participants that are less reliant
on movement of people and goods between the UK and theEuropean Union, and have a material adverse effect on the
Company’s results. See also “— Risk Factors – Business-Related
Risks – Major Research and Development Programmes”.
Airbus / Registration Document 201809

Risk Factors /1 Financial Market Risks

The Company has launched a major Brexit planning projectin order to understand, eradicate and/or mitigate risks in thefollowing areas: People, Certifications, Customs, Procurement& Supply Chain, Transport and Logistics, Export Control,
Environment, Security, Capital & Financial Services, Legal.
The Company is working with suppliers and partners tostockpile parts, prepare our customs and regulatory systems
and mitigate impacts where possible, for example transport
where the Company prepared additional means in advanceof 31 March 2019 and is planning do so again for 31 October
2019. The Company is also working with suppliers and partners
to assess and improve their readiness level and encouraging
them to do the same with their supply chains.

In addition, the Company has established a quick reaction crisis
management organisation to address any unknown events /risks which may occur.
Because of the unprecedented nature of the No deal Brexit,
the commercial aerospace and defence industries in which
the Company operates may plunge into unknown territory
and the Company’s operations and supply chain may sufferfrom disruptions, the nature, materiality and duration of which
is impossible to predict with any level of certainty. If the UK
were to leave the European Union and it is considered a third
country without a privileged relationship with the European
Union, the Company’s business, results of operations andfinancial condition could be materially affected.

Foreign Currency Exposure
As of the date of this Registration Document, more than 75%of the Company’s revenues are denominated in US dollars,with approximately 60% of such currency exposure “naturally
hedged” by US dollar-denominated costs. To the extent that
the Company does not use financial instruments to hedge its
exposure resulting from this foreign currency mismatch, its
profits will be affected by market changes in the exchange rateof the US dollar against these currencies.
There are complexities inherent in determining whether andwhen foreign currency exposure of the Company will materialise,in particular given the possibility of unpredictable revenue
variations arising from order cancellations, postponements ordelivery delays. The Company may also have difficulty in fully
implementing its hedging strategy if its hedging counterparties
are unwilling to increase derivatives risk limits with the Company,
and is exposed to the risk of non-performance or default by
these hedging counterparties. The exchange rates at which
the Company is able to hedge its foreign currency exposure
may also deteriorate, as the euro could appreciate against
the US dollar for some time as has been the case in the past
and as higher capital requirements for banks result in higher
credit charges for uncollateralised derivatives. Accordingly,
the Company’s foreign currency hedging strategy may notprotect it from significant changes in the exchange rate of
the US dollar to the euro and the pound sterling, in particularover the long term, which could have a negative effect on its
financial condition and results of operations. In addition, theportion of the Company’s US dollar-denominated revenues
that is not hedged in accordance with the Company’s hedging
strategy will be exposed to fluctuations in exchange rates, which
may be significant. As of 31 December 2018, the total hedge
portfolio with maturities up to 2024 amounts to US$ 81.9 billion
and covers a major portion of the foreign exchange exposure
expected over the period of the operative planning.

*

10

Furthermore, the Company is exposed to certain other pricerisks such as interest rate risks, changes in commodity prices
and in the price of its own stocks. Adverse movements of theseprices may jeopardise the Company’s profitability if not hedged.
Currency exchange rate fluctuations in currencies otherthan the US dollar in which the Company incurs its principal
manufacturing expenses (mainly the euro) may affect the abilityof the Company to compete with competitors whose costs
are incurred in other currencies. This is particularly true withrespect to fluctuations relative to the US dollar, as many of theCompany’s products and those of its competitors (e.g., in the
defence export market) are priced in US dollars. The Company’s
ability to compete with competitors may be eroded to the extent
that any of the Company’s principal currencies appreciates
in value against the principal currencies of such competitors.
The Company’s consolidated revenues, costs, assets andliabilities denominated in currencies other than the euro aretranslated into the euro for the purposes of compiling its financial
statements. Changes in the value of these currencies relative
to the euro will therefore have an effect on the euro value of theCompany’s reported revenues, costs, earnings before interestand taxes (“EBIT”), other financial results, assets, liabilities andequity.
See “— Management’s Discussion and Analysis of Financial
Condition and Results of Operations — 2.1.7 Hedging
Activities” for a discussion of the Company’s foreign currency
hedging strategy. See “— Management’s Discussion andAnalysis of Financial Condition and Results of Operations— 2.1.2.3 Accounting for Hedged Foreign Exchange Transactionsin the Financial Statements” for a summary of the Company’s
accounting treatment of foreign currency hedging transactions.

Unless otherwise indicated, EBIT figures presented in this report are Earning before Interest and Taxes. It is identical to Profit before finance cost and income taxes
as defined by IFRS Rules.

Airbus / Registration Document 2018

REGISTRATION DOCUMENT 2018
Risk Factors /1 Financial Market Risks

Sales Financing Arrangements
In support of sales, the Company may agree to participate in thefinancing of selected customers. Over the last three years (2016to 2018), the average number of aircraft delivered in respect ofwhich financing support has been provided by Airbus amounted
to less than 1% of the average number of deliveries over thesame period, i.e. 4 aircraft financed per year out of 735 deliveries
per year on average.
The risks arising from the Company’s sales financing activities
may be classified into two categories: (i) credit risk, which
relates to the customer’s ability to perform its obligations
under a financing arrangement, and (ii) aircraft value risk, whichprimarily relates to unexpected decreases in the future valueof aircraft. Defaults by its customers or significant decreases
in the value of the financed aircraft in the resale market may
materially adversely affect the Company’s business, results ofoperations and financial condition.
The Company’s sales financing arrangements expose it toaircraft value risk, because it generally retains security interests
in aircraft for the purpose of securing customers’ performanceof their financial obligations to the Company, and/or because
it may guarantee a portion of the value of certain aircraft at
certain anniversaries from the date of their delivery to customers.
Under adverse market conditions, the market for used aircraft
could become illiquid and the market value of used aircraft
could significantly decrease below projected amounts. In

the event of a financing customer default at a time when themarket value for a used aircraft has unexpectedly decreased,
the Company would be exposed to the difference between theoutstanding loan amount and the market value of the aircraft,
net of ancillary costs (such as maintenance and remarketingcosts, etc.). Similarly, if an unexpected decrease in the market
value of a given aircraft coincided with the exercise window dateof an asset value guarantee with respect to that aircraft, theCompany would be exposed to losing as much as the difference
between the market value of such aircraft and the guaranteedamount, though such amounts are usually capped. Throughthe Airbus Asset Management department or as a result of
past financing transactions, the Company is the owner of usedaircraft, exposing it directly to fluctuations in the market valueof these used aircraft.
In addition, the Company has outstanding backstop
commitments to provide financing related to orders on Airbus’
and ATR’s backlog. The Company’s sales financing exposure
could rise in line with future sales growth depending on theagreement reached with customers. The Company remains
exposed to the risk of defaults by its customers or significant
decreases in the value of the financed aircraft in the resalemarket, which may have a negative effect on its future financial
condition and results of operations.

Counterparty Credit
In addition to the credit risk relating to sales financing as
discussed above, the Company is exposed to credit risk to theextent of non-performance by its counterparties for financial
instruments, such as hedging instruments ($ 81.8 billion nominal
value at 31 March 2019) and cash investments ($ 18.5 billion
nominal value at 31 March 2019). However, the Company has
policies in place to avoid concentrations of credit risk and toensure that credit risk exposure is limited.
Counterparties for transactions in cash, cash equivalents andsecurities as well as for derivative transactions are limited tohighly rated financial institutions, corporates or sovereigns.

The Company’s credit limit system assigns maximum exposurelines to such counterparties, based on a minimum credit rating
threshold as published by Standard & Poor’s and Moody’s.
If neither is present Fitch ratings is used. Besides the credit
rating, the limit system also takes into account fundamental
counterparty data, as well as sector and maturity allocations
and further qualitative and quantitative criteria such as credit risk
indicators. The credit exposure of the Company is reviewed ona regular basis and the respective limits are regularly monitored
and updated.

As of 31 March 2019 the credit exposure had been estimated as follows:
Source of risk

Exposure

Unexpected Loss
Contribution

Banks

4,949

70

Corporates

6,731

211

Sovereign Issuers

1,156

8

Money Market Funds

4,527

8

17,363297

Total

The Company also seeks to maintain a certain level ofdiversification in its portfolio between individual counterparties
as well as between financial institutions, corporates andsovereigns in order to avoid an increased concentration of credit
risk on only a few counterparties.

Airbus / Registration Document 2018

11

Risk Factors /2 Business-Related Risks

However, there can be no assurance that the Company will not
lose the benefit of certain derivatives or cash investments in caseof a systemic market disruption. In such circumstances, thevalue and liquidity of these financial instruments could decline
and result in a significant impairment, which may in turn havea negative effect on the Company’s financial condition andresults of operations.
Moreover, the progressive implementation of new financial
regulations (MiFiD II / MiFIR, CRD4, Bank Restructuring
Resolution Directive, etc.) will have an impact on the businessmodel of banks (for example, the split between investmentbanking and commercial banking activities) and on thecapital structure and cost of such banks’ activities in relation
to over-the-counter derivatives, and therefore on the funding
consequences of central clearing and collateralisation of overthe-counter derivatives for corporations like the Company.
This may ultimately increase the cost and reduce the liquidityof the Company’s long-term hedges, for example, as banks
seek to either pass-on the additional costs to their corporate
counterparties or withdraw from low-profit businesses
altogether.

Pension Commitments
The Company participates in several pension plans for both
executive as well as non-executive employees, some of which
are underfunded. As of 31 December 2018, the provision
for retirement plans and similar obligations amounted to€ 7.072 billion. For information related to these plans, please referto the “Notes to the IFRS Consolidated Financial Statements— Note 29.1: Post-employment Benefits — Provisions for
Retirement Plans”. Although the Company has recorded a
provision in its balance sheet for its share of the underfunding
based on current estimates, there can be no assurance thatthese estimates will not be revised upward in the future, leading
the Company to record additional provisions in respect of suchplans.

2.

Necessary adjustments of such provisions include but are
not limited to (i) the discount factor (dependent in part oninterest rates) and the inflation rate applied to calculate thenet present value of the pension liabilities, (ii) the performanceof the asset classes which are represented in the pension
assets, (iii) behavioural assumptions regarding beneficiaries
and (iv) additional cash injections contributed by the Company
from time to time to the pension assets. The Company has taken
measures to reduce potential losses on the pension assets
and to better match the characteristics of the pension liabilities
with those of the pension assets as a long-term objective.
Nevertheless, any required additional provisions would have anegative effect on the Company’s total equity (net of deferredtaxes), which could in turn have a negative effect on its futurefinancial condition.

Business-Related Risks

Commercial Aircraft Market Factors
Historically, the Company has experienced that order intake
for commercial aircraft has shown cyclical trends, due in partto changes in passenger demand for air travel and the air
cargo share of freight activity, which are in turn driven by arange of economic variables, such as gross domestic product(“GDP”) growth, private consumption levels or working age
population size. Other factors, however, play an important rolein determining the market for commercial aircraft, such as (i) the
average age and technical obsolescence of the fleet relative to
new aircraft, (ii) the number and characteristics of aircraft takenout of service and parked pending potential return into service,(iii) passenger and freight load factors, (iv) airline pricing policies
and resultant yields, (v) airline financial health and the availabilityof third party financing for aircraft purchases, (vi) evolutionof fuel price, (vii) regulatory environment, (viii) environmental
constraints imposed upon aircraft operations, such as the12

Airbus / Registration Document 2018

Carbon Offsetting and Reduction Scheme for International
Aviation (CORSIA), carbon standards and other environmental
taxes, and (ix) market evolutionary factors such as the growthof low-cost passenger airline business models or the impactof e-commerce on air cargo volumes.
The factors described above may have a material impact
on the commercial aircraft industry and therefore on the
Company’s financial condition and results of operations. In
2018, Airbus (commercial aircraft) recorded total revenues of€ 47.97 billion – representing 75% of the Company’s revenues.
See “— 1.1.2 Airbus”. The significant growth of our commercial
aircraft business relative to our Defence, Space and Government
activities has diluted the latter’s ability to serve as an effective
tool to counter commercial cycles.

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Risk Factors /2 Business-Related Risks

The commercial helicopter market in which the Company
operates has shown cyclical trends and could also be influenced
by factors listed above. In addition, the civil & parapublic and inparticular the oil & gas market softness has led to and may infuture lead to a postponement of investments in the acquisitionof new platforms and a reduction of flight hours. Structuralchanges in demand for helicopters in the oil & gas segment
are not anticipated at current oil price levels. However this maychange as oil & gas prices fluctuate. The uncertainty on the leadtime of the civil and parapublic market recovery may have an
impact on Airbus Helicopters financial results and could leadto cancellations or loss of bookings and services.

The commercial helicopter market in which the Company
operates could also be influenced by a number of factors listed
above. The civil & parapublic and oil & gas market softness
has led to a postponement of investments in the acquisition of
new platforms by offshore helicopter players and a reductionof flight hours. Structural changes of the oil & gas segment are
not anticipated at current oil price levels. The uncertainty on thelead time of the market recovery may have an impact on Airbus
Helicopters financial results and could lead to cancellations orloss of bookings and services.

Cyber Security Risks
The Company’s extensive information and communications
systems are exposed to cyber security risks, which are rapidlychanging, and increasing in sophistication and potential impact.
The Company is exposed to a number of different types ofpotential security risks, arising from actions that may be intentionaland hostile, accidental or negligent. Industrial espionage,
cyber-attacks including systems sabotage, data breaches(confidential data, personal data and intellectual property), anddata corruption and availability (notably ransomware) are themain risks that the Company may face. Risks related to theCompany’s industrial control systems, manufacturing processes
and products are growing, with the increase of interconnectivity
and digitalisation, and with a growing gap developing between
the defences of older, relatively insecure industrial systems andthe capabilities of potential attackers as well as an increasinglycompetitive landscape in both historical and new businessesof the Company.

All of the above mentioned risks are heightened in the context ofgreater use of cloud services, increasingly capable adversaries,
integration with the extended enterprise, the relatively insecure“internet of things” and the growing use in the Company’s IT
systems of sophisticated mobile devices. Social engineering isa growing threat, exacerbated by advances in machine learning.
Finally, the Company is exposed to reputational damage fromthe growing volume of false and malicious information injected
to media and social networks.
While the Company continues to make significant efforts
to prevent such risks from materialising, making targeted
investments will reduce but not eradicate likelihood and impact
through strengthening the business cyber resilience.
The materialisation of one or several of such risks could lead tosevere damage including but not limited to significant financial
loss, need for additional investment, contractual or reputational
performance degradation, loss of intellectual property, loss ofbusiness data and information, operational business degradation
or disruptions, and product or services malfunctions.

Physical Security, Terrorism, Pandemics and Other Catastrophic Events
Past terrorist attacks and the spread of disease (such as theH1N1 flu pandemic or the Ebola epidemic in 2013-2016) havedemonstrated that such events may negatively affect public
perception of air travel safety, which may in turn reduce demand
for air travel and commercial aircraft. The outbreak of wars,
riots or political unrest or uncertainties may also affect thewillingness of the public to travel by air. Furthermore, major
aircraft accidents may have a negative effect on the public’s orregulators’ perception of the safety of a given class of aircraft,a given airline, form of design or air traffic management. As aresult of such factors, the aeronautic industry may be confronted
with sudden reduced demand for air transportation and becompelled to take costly security and safety measures. The
Company may therefore suffer from a decline in demand forall or certain types of its aircraft or other products, and theCompany’s customers may postpone delivery or cancel orders.
In addition to affecting demand for its products, catastrophic
events could disrupt the Company’s internal operations or
its ability to deliver products and services. Disruptions may
be related to threats to infrastructure, personnel security andphysical security and may arise from terrorism, drone attacks,
natural disasters, damaging weather, and other crises. Any
resulting impact on the Company’s production, services orinformation systems could have a significant adverse effecton the Company’s operations, financial condition and resultsof operations as well as on its reputation and on its products
and services.

Airbus / Registration Document 201813

Risk Factors /2 Business-Related Risks

Dependence on Key Suppliers and Subcontractors
The Company is dependent on numerous key suppliers andsubcontractors to provide it with the raw materials, parts,
assemblies, systems, equipment and services that it needs tomanufacture its products.
The Company relies upon the good performance of its suppliers
and subcontractors to meet the obligations defined under theircontracts.
The Company cannot fully protect itself from non-performanceof a supplier which could disrupt production and in turn may
have a negative effect on its financial condition and results ofoperations.

This may have a negative effect on the financial condition andresults of operations of the Company.
As the Company’s global sourcing footprint extends, some
suppliers (or their sub-tier suppliers) may have production
facilities located in the UK or countries that are exposed tosocio-political unrest or natural disasters which could interrupt
deliveries. This may have a negative effect on the financial
condition and results of operations of the Company. See “— Risk
Factors – Financial Market Risks – The Company’s business,
results of operations and financial condition could be materiallyaffected by Brexit”.

Changes to the Company’s production or development
schedules may impact suppliers so that they initiate claims
under their respective contracts for financial compensation.

Industrial Ramp-Up
As a result of the large number of new orders for aircraft
recorded in recent years, the Company continues the processof accelerating its production in order to meet the agreed upondelivery schedules for such new aircraft. The Company’s ability
to further increase its production rate will be dependent upon avariety of factors, including execution of internal performanceplans, availability of raw materials, parts (such as aluminium,
titanium and composites) and skilled employees given the highdemand by the Company and its competitors, conversion of
raw materials into parts and assemblies, and performance by
suppliers and subcontractors (particularly suppliers of enginesand buyer-furnished equipment) who may experience resourceor financial constraints due to ramp-up. Management of suchfactors is also complicated by the development of new aircraft
programmes in parallel, across Airbus and the two Divisions,which carry their own resource demands. Therefore, failures
relating to any or all of these factors could lead to missed ordelayed delivery commitments, and depending on the length ofdelay in meeting delivery commitments, could lead to additionalcosts and customers’ rescheduling or terminating their orders.
The associated risks may increase as the Company and its
competitors announce further production rate increases. For
more details on specific programme ramp-up risks, see“— Programme-Specific Risks” below.

Technologically Advanced Products and Services
The Company offers its customers products and services
that are technologically advanced, the design, manufacturing,components and materials utilised can be complex and require
substantial integration and coordination along the supply chain.
In addition, most of the Company’s products must function underdemanding operating conditions. Throughout the lifecycle of our
products, the Company performs checks and inspections, which
may result in modifications, retrofits or other corrective actions
each of which may have a material adverse effect on production,
operations, in-service performance or financial condition. Therecan be no assurance that the Company’s products or services
will be successfully developed, manufactured or operated orthat they will perform as intended.
Certain of the Company’s contracts require it to forfeit part ofits expected profit, to receive reduced payments, to provide a
replacement launch or other products or services, to provide
cancellation rights, or to reduce the price of subsequent sales
to the same customer if its products fail to be delivered on

14

Airbus / Registration Document 2018

time or to perform adequately. No assurances can be giventhat performance penalties or contract cancellations will not be
imposed should the Company fail to meet delivery schedules
or other measures of contract performance — in particularwith respect to new development programmes such as theA350-900 and -1000 XWB, A400M, H175 or H160 and tomodernisation programmes such as the A320neo and theA330neo. See “— Programme-Specific Risks” below.
In addition to the risk of contract cancellations, the Company
may also incur significant costs or loss of revenues in connection
with remedial action required to correct any performance issues
detected in its products or services. See “— Management’s
Discussion and Analysis of Financial Condition and Results ofOperations — 2.1.1.3 Significant programme developments,
restructuring and related financial consequences in 2016, 2017and 2018”. Moreover, to the extent that a performance issue isconsidered to have a possible impact on safety, regulators could
suspend the authorisation for the affected product or service.

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Risk Factors /2 Business-Related Risks

Any significant problems with the development, manufacturing,
operation or performance of the Company’s products
and services could have a significant adverse effect on the

Company’s financial condition and results of operations as wellas on the reputation of the Company and its products andservices.

Dependence on Public Spending and on Certain Markets
In any single market, public spending (including defence andsecurity spending) depends on a complex mix of geopoliticalconsiderations and budgetary constraints, and may therefore be
subject to significant fluctuations from year to year and country
to country. Any termination or reduction of future funding orcancellations or delays impacting existing contracts may havea negative effect on the Company’s financial condition andresults of operations. In instances where several countries
undertake to enter together into defence or other procurement

contracts, economic, political or budgetary constraints in any
one of these countries may have a negative effect on the abilityof the Company to enter into or perform such contracts.
The Company has a geographically diverse backlog. Adverse
economic and political conditions as well as downturns in broad
economic trends in certain countries or regions may have anegative effect on the Company’s financial condition and resultsof operations generated in those regions.

Availability of Government and Other Sources of Financing
From 1992 to 2004, the European Union and the US operated
under an agreement that sets the terms and conditions offinancial support that governments may provide to civil aircraft
manufacturers. In late 2004, however, the US unilaterally
withdrew from this agreement, which eventually led to the US
and the European Union making formal claims against eachother before the World Trade Organization (“WTO”). While bothsides have expressed a preference for a negotiated settlementthat provides for a level playing field when funding future aircraft
developments, they have thus far failed to reach agreement on
key issues.
Separately, Brazil has initiated WTO proceedings citing
Canadian support to the C Series aircraft, the aircraft that Airbus
manufactures, markets and supports as the A220 aircraft underthe “C Series Aircraft Limited Partnership” (formerly known as
CSALP; Airbus Canada Limited Partnership as of 1 June 2019)agreement, finalised in 2018. Here too, a negotiated outcome
would be preferable. Domestic proceedings in the United States
based on alleged subsidies to the C Series were dismissed by
US authorities for lack of proof. The terms and conditions of any
new agreement, or the final outcome of the formal WTO or othertrade law proceedings, may limit access by the Company to risksharing-funds for large projects, may establish an unfavourable
balance of access to government funds by the Company ascompared to its US competitors or may in an extreme scenariocause the involved governments to analyse possibilities for achange in the commercial terms of funds already advanced to
the Company.

Considering the current political environment and absent a
negotiated settlement, this could affect the delivery of new
Airbus aircraft and helicopters to the US market and may
have a negative effect on the Company’s financial condition
and results of operations. The Company cannot predict at
this time the impact on it or on the industry as a result of thepotential imposition of import duties and any resulting tradewar, and accordingly cannot give any assurance that it will not
be adversely affected. See WTO in “— Risk Factors – Legal
Risks – Legal and Regulatory Proceedings” and “— Informationon the Company’s Activities — 1.1.7 Legal and Arbitration
Proceedings”.
In prior years, the Company and its principal competitors
have each received different types of government financing ofproduct research and development. However, no assurances
can be given that government financing will continue to be madeavailable in the future, in part as a result of the proceedings
mentioned above. Moreover, the availability of other outside
sources of financing will depend on a variety of factors
such as market conditions, the general availability of credit,
the Company’s credit ratings, as well as the possibility that
lenders or investors could develop a negative perception of theCompany’s long- or short-term financial prospects if it incurred
large losses or if the level of its business activity decreased
due to an economic downturn. The Company may therefore
not be able to successfully obtain additional outside financing
on appropriate terms, or at all, which may limit the Company’s
future ability to make capital expenditures, fully carry out its
research and development efforts and fund operations.

Airbus / Registration Document 201815

Risk Factors /2 Business-Related Risks

Competition and Market Access
The markets in which the Company operates are highly
competitive. With regard to the Company’s commercial
aircraft business for aircraft with more than 150 seats, theCompany today operates in a competitive duopoly. The design,development and production of commercial aircraft involves
high barriers to entry (including certification requirements,
large investment needs, skilled competences and access totechnology) and the two main market participants have secured
significant order backlogs.
In some areas, competitors may have more extensive or
more specialised engineering, manufacturing and marketing
capabilities. In addition, some of the Company’s largest
customers and/or suppliers may develop the capability to
manufacture products or provide services similar to those of
the Company. This would result in these customers/suppliers
marketing their own products or services and competing directlywith the Company for sales of these products or services, allof which could significantly reduce the Company’s revenues.
Further, new players are operating or seeking to operate in the

Company’s existing markets which may impact the structure
and profitability of these markets. In addition, enterprises
with different business models could substitute some of theCompany’s products and services. There can be no assurance
that the Company will be able to compete successfully against its
current or future competitors or that the competitive pressures
it faces in all business areas will not result in reduced revenues,
market share or profit.
In addition, the contracts for many aerospace and defence
products are awarded, implicitly or explicitly, on the basis of homecountry preference. Although the Company is a multinational
company which helps to broaden its domestic market, it may
remain at a competitive disadvantage in certain countries,
especially outside of Europe, relative to local contractors
for certain products. The strategic importance and politicalsensitivity attached to the aerospace and defence industries
means that political considerations will play a role in the choiceof many products for the foreseeable future.

Major Research and Development Programmes
The business environment in many of the Company’s operating
business segments is characterised by extensive research anddevelopment costs requiring significant up-front investmentswith a high level of complexity. For the first three months
2019, research and development expenses were € 0.7 billion,
compared to € 0.6 billion in the first three months 2018. For
the year 2018, research and development expenses were
€ 3.2 billion, mainly reflecting development cost on the A320neo.
Due to the technologically advanced complex nature of the
products that the Company produces and the long period,
including ramp up time, it takes to produce them, the businessplans underlying such investments often contemplate a long
payback period before these investments are recouped, andassume a certain level of return over the course of this period inorder to justify the initial investment. There can be no assurancesthat the commercial, technical and market assumptions
underlying such business plans will be met, and consequently,
the payback period or returns contemplated therein achieved.
Successful development of new programmes also depends on
the Company’s ability to attract and retain aerospace engineers
and other professionals with the technical skills and experience
required to meet its specific needs. Demand for such engineers
may often exceed supply depending on the market, resulting in
intense competition for qualified professionals. The Company’s
attrition rate in 2018 was 4.9% overall (incl. subsidiaries) and
8.51% in subsidiaries only. There can be no assurances that
the Company will attract and retain the personnel it requires to16

Airbus / Registration Document 2018

conduct its operations successfully and in particular to attract
and retain aerospace engineers and other professionals withthe technical skills and experience required for its research anddevelopment programmes. Failure to attract and retain such
personnel or an increase in the Company’s employee turnoverrate could negatively affect the Company’s financial condition
and results of operations more generally and particularly its
ability to successfully execute its research and development
programmes.
No assurance can be given that the Company will achieve
the anticipated level of returns from these programmes andother development projects, which may negatively affect theCompany’s financial condition and results of operations andcompetitiveness.
In the context of the post-Brexit relationship between the UK
and the European Union, there is a risk that the Company
might lose access to pooled expertise and knowledge andcould face disruptions within its interdependent and extensively
integrated research and innovation networks across the UK and
the European Union countries. The Company may also face lackof certainty with respect to intellectual property rights for existingor new programmes and established or potential partnerships
with private or public organisations, academic institutions andresearch councils, charities and government departments,
where the relevant intellectual property frameworks or userrights/ownership governing those relationships is dependent
on the UK’s status as a member state of the European Union.

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Risk Factors /2 Business-Related Risks

Acquisitions, Divestments, Joint Ventures and Strategic Alliances
As part of its business strategy, the Company may acquireor divest businesses and/or form joint ventures or strategic
alliances. Executing acquisitions and divestments can bedifficult and costly due to the complexities inherent in integratingor carving out people, operations, technologies and products.
There can be no assurance that any of the businesses that
the Company intends to acquire or divest can be integrated or
carved out successfully, as timely as originally planned or thatthey will perform well and deliver the expected synergies or costsavings once integrated or separated. In addition, regulatory,administrative or other contractual conditions can prevent
transactions from being finalised. The Company’s business,
results of operations and financial condition may be materiallyaffected if these transactions will not be successfully completedor do not produce the expected benefits.

Public-Private Partnerships and Private Finance Initiatives
Defence customers may request proposals and grant contracts
under schemes known as public-private partnerships (“PPPs”)
or private finance initiatives (“PFIs”). PPPs and PFIs differ
substantially from traditional defence equipment sales, as theyoften incorporate elements such as:
the provision of extensive operational services over the lifeof the equipment;
continued ownership and financing of the equipment by a party
other than the customer, such as the equipment provider;mandatory compliance with specific customer requirements
pertaining to public accounting or government procurement
regulations; andprovisions allowing for the service provider to seek additionalcustomers for unused capacity.

-----

The Company is party to PPP and PFI contracts, for example
Skynet 5 and related telecommunications services, and in the
AirTanker (FSTA) project both with the UK MoD. One of thecomplexities presented by PFIs lies in the allocation of risks
and the timing thereof among different parties over the life-timeof the project.
There can be no assurances of the extent to which the Company
will efficiently and effectively (i) compete for future PFI or PPP
programmes, (ii) administer the services contemplated under
the contracts, (iii) finance the acquisition of the equipment andthe ongoing provision of services related thereto, or (iv) accessthe markets for the commercialisation of excess capacity. The
Company may also encounter unexpected political, budgetary,
regulatory or competitive risks over the long duration of PPP
and PFI programmes.

Programme-Specific Risks
In addition to the risk factors mentioned above, the Company
also faces the following programme-specific risks that could
have a material impact on the Company’s financial condition
and results of operations:
A320neo programme. In connection with the A320neo
programme, the Company faces the following main challenges:
A320neo (new engine option) ramp up including the A321neo
ACF (Airbus Cabin Flex) with its new airframe and cabin
design; management of the internal and external supply chainpressure as a result of the industrial ramp-up; ensuring maturity
and high quality service support for a growing number ofoperators of A320neo. The main focus will be with the further
ramp-up for the Company and both engine suppliers. For
both engine suppliers, challenges are to (i) meet the delivery
commitments in line with agreed schedule and ensure sufficientengine availability; (ii) fix in-service maturity issues in line with
the Company and customer expectations and mitigate theassociated consequences; (iii) manage engine upgrades andperformance. The E2E industrial and delivery process at theCompany is currently under review and will result in significant
process and organisation changes.

A400M programme. The Company signed a contract
amendment to restructure the contract. Risks remain on
development of technical capabilities and the associatedcosts, on securing sufficient export orders in time, on aircraft
operational reliability in particular with regards to engines andon cost reductions as per the revised baseline.
For further information, please refer to the “— Notes to the
IFRS Consolidated Financial Statements — Note 10: Revenue
and Gross Margin”.
A350 XWB programme. In connection with the A350 XWB
programme, the Company faces the following main challenges:
ensuring satisfaction of operators and high quality support
to their operations; maintaining supply chain performanceand production ramp-up; controlling and reducing the levelof outstanding work in final assembly line; reducing recurringcosts during the ongoing ramp-up; maintaining customisation
and ramp-up of Heads of Version; maintaining the development
schedule in line with learning curve assumptions beyond theinitial ramp up phase of A350-1000 XWB; maintaining attention
on engine development; and customer support for new typein service.

Airbus / Registration Document 201817

Risk Factors /3 Legal Risks

A380 programme. In connection with the A380 programme,
the Company faces the following main challenges: programme
wind-down; and manage in service issues.
A330 programme. In connection with the A330 programme,
the main challenge the Company faces is to manage the ramp
up of the A330neo. The A330neo development progresses after
successful EIS (Entry Into Service). For the engine supplier, themain challenges relate to meeting the delivery commitments
and ensuring engine maturity.
A220 programme. In connection with the A220 programme,
the main challenges the Company faces are to build commercial
momentum, ramp up production and reduce costs.
H225 programme and AS332 L2 fleet. In connection with the
H225 programme and the AS332 L2 fleet, the Company faces
the following main challenges: since the crash in April 2016of a H225 in Norway, the Company is dealing with protective
measures validated by EASA who lifted the flight suspension on
7 October 2016 and by UK and Norwegian aviation authorities
on 7 July 2017 to put the fleet back into flight operations.
Publication of the final AIBN report in July 2018 confirmed thework on incremental improvements on the H225 as part of its
ongoing, continuous improvement.
H175 programme. In connection with the H175 programme
produced in cooperation with Avic, the Company faces thefollowing main challenges: after the delivery of the first H175
in VIP configuration in 2016, the delivery of the 6 first H175 in
Public Services intermediate operational configuration in 2018,
the Company is working on the maturity plan of the aircraftwith the associated industrial ramp-up and on the customer
support.

3.

NH90 and Tiger programmes. In connection with the NH90
and Tiger programmes, the Company is delivering according
to contracts whilst negotiations for the end of some contracts
and some new contract amendments are still ongoing. In
connection with multiple fleets entering into service it faces
the challenge of assuring support readiness.
H160 programme. In connection with the H160 programme,
the main challenge the Company faces is to manage thecertification and the production ramp-up. H160 development
and supply chain performance and production ramp-up
progress after 1,050 flights hours performed by the end of
2018 by prototypes and pre-serial 2 (PS2) move to the flight line.
Border security projects. In connection with border security
projects, the Company faces the following main challenges:
meeting the schedule and cost objectives taking into accountthe complexity of the local infrastructures to be delivered andthe integration of commercial-off-the-shelf products (radars,
cameras and other sensors) interfaced into complex system
networks; assuring efficient project and staffing; managing therollout including subcontractors and customers. Negotiations
on change requests and schedule re-alignments remain
ongoing. Due to the prolonged suspension of defence export
licenses to Saudi Arabia by the German government, and theconsequential inability of the Company to execute a customer
contract, a € 190 million impairment charge has been recognised
mainly on inventories and a € 107 million financial expense
related to hedge ineffectiveness. The Company is engaging
with its customer to agree a way forward on this contract. The
outcome of these negotiations is presently unclear but could
result in significant further financial risks.

Legal Risks

Legal and Regulatory Proceedings
The Company is currently engaged in a number of active legal
and regulatory proceedings.
The WTO litigation, which is described in “— Risk Factors –Business-Related Risks – Availability of Government and other
Sources of Financing”, is ongoing. The potential imposition of any
import duties (and the amount thereof) or other countermeasuresagainst the European Union will depend on the United States
Trade Representative, and could have a material impact on thefinancial statements, business and operations of the Company.
For more information on the WTO litigation and trade dispute,see “— Information on the Company’s Activities — 1.1.7 Legaland Arbitration Proceedings” (WTO).
The investigation by the UK SFO and France’s PNF, which is
described in “— Risk Factors – Legal Risks – Anticorruption
Laws and Regulations”, is ongoing. The potential imposition ofany monetary penalty (and the amount thereof) or other sanction
including tax liability arising from the investigation by the UK

18

Airbus / Registration Document 2018

SFO and France’s PNF will depend on the ultimate factual andlegal findings of the investigation, and could have a material
impact on the financial statements, business and operationsof the Company. For more information about the investigation,
see “— Information on the Company’s Activities — 1.1.7 Legaland Arbitration Proceedings” (Investigation by the UK SFO andFrance’s PNF and Related Commercial Litigation).
The Company expects to continue to incur time and expenses
associated with its defence, regardless of the outcome, and thismay divert the efforts and attention of management from normal
business operations. Although the Company is unable to predict
the outcome of these proceedings, it is possible that they will
result in the imposition of damages, fines or other remedies,
which could have a material effect on the Company’s business,
results of operations and financial condition. An unfavourable
ruling could also negatively impact the Company’s stock priceand reputation.

REGISTRATION DOCUMENT 2018
Risk Factors /3 Legal Risks

In addition, the Company is from time to time subject togovernment inquiries and investigations of its business andcompetitive environment due, among other things, to the heavily
regulated nature of its industry. In addition to the risk of an
unfavourable ruling against the Company, any such inquiry or
investigation could negatively affect the Company’s reputationand its ability to attract and retain customers and investors,
which could have a negative effect on its business, resultsof operations and financial condition. See “— Non-Financial
Information — 1.1.8.4(a) Responsible Business — EthicalBusiness Practices”.

Anti-Corruption Laws and Regulations
The Company is required to comply with applicable anti-bribery
laws and regulations in jurisdictions around the world where it
does business. To that end, an anti-corruption programme has
been put in place that seeks to ensure adequate identification,assessment, monitoring and mitigation of corruption risks.
Despite these efforts, ethical misconduct or non-compliancewith applicable laws and regulations by the Company, its
employees or any third party acting on its behalf could expose
it to liability or have a negative impact on its business.
In 2016, for example, the Company announced that it had
discovered misstatements and omissions in certain applications
for export credit financing for Airbus customers, and had
engaged legal, investigative and forensic accounting experts
to conduct a review. Separately, the UK Serious Fraud Officeannounced that it had opened a criminal investigation into
allegations of fraud, bribery and corruption in the civil aviation
business of the Company, relating to irregularities concerning
third party consultants. Airbus was subsequently informed that
the French authorities, the Parquet National Financier (“PNF”),
had also opened a preliminary investigation into the same

subject and that the two authorities will act in coordination
going forward. The Company has engaged with the governmentof the United States relating to conduct forming part of the
SFO/PNF investigation that could fall within US jurisdiction.
The Company has also engaged with the government of theUnited States concerning potential issues of ITAR Part 130 and
related matters. See “— Information on the Company’s Activities— 1.1.7 Legal and Arbitration Proceedings”.
The Company cannot predict at this time the impact on it asa result of these matters, and accordingly cannot give any
assurance that it will not be adversely affected. The Company
may be subject to administrative, civil or criminal liabilities
including significant fines and penalties, as well as suspension
or debarment from government or non-government contracts
for some period of time. The Company may also be required tomodify its business practices and compliance programme and/or have a compliance monitor imposed on it. Any one or moreof the foregoing could have a significant adverse effect on the
Company’s reputation and its business, results of operations
and financial condition.

Export Controls Laws and Regulations
The export market is a significant market for the Company.
In addition, many of the products the Company designs andmanufactures for military use are considered to be of national
strategic interest. Consequently, the export of such products
outside of the jurisdictions in which they are produced may
be restricted or subject to licensing and export control
requirements, notably by the UK, France, Germany and Spain,
where the Company carries out its principal activities relating
to military products and services as well as by other countries
where suppliers are based, notably, the US. There can be noassurance (i) that the export controls to which the Company issubject will not become more restrictive, (ii) that new generationsof the Company’s products will not also be subject to similar
or more stringent controls or (iii) that geopolitical factors orchanging international circumstances will not make it impossible
to obtain export licenses for one or more clients or constrain
the Company’s ability to perform under previously signed
contracts. Reduced access to military export markets may havea significant adverse effect on the Company’s business, resultsof operations and financial condition.

Operating worldwide, the Company must comply with several,
sometimes inconsistent, sets of sanctions laws and regulations
implemented by national / regional authorities. Depending on
geopolitical considerations including national security interestsand foreign policy, new sanctions regimes may be set up or thescope of existing ones may be widened, at any time, immediately
impacting the Company’s activities.
Although the Company seeks to comply with all such laws andregulations, even unintentional violations or a failure to comply
could result in suspension of the Company’s export privileges,or preclude the Company from bidding on certain government
contracts (even in the absence of a formal suspension or
debarment).
Furthermore, the Company’s ability to market new products andenter new markets may be dependent on obtaining government
certifications and approvals in a timely manner.

Airbus / Registration Document 2018

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Risk Factors /3 Legal Risks

Dependence on Joint Ventures and Minority Holdings
The Company generates a substantial proportion of its revenues
through various consortia, joint ventures and equity holdings.
These arrangements include primarily:
the Eurofighter and AirTanker consortia; andfour principal joint ventures: ArianeGroup, ATR, Airbus Canada(formerly CSALP) and MBDA.

---

The formation of partnerships and alliances with other market
players is an integral strategy of the Company, and the
proportion of sales generated from consortia, joint venturesand equity holdings may rise in future years. This strategy may
from time to time lead to changes in the organisational structure,or realignment in the control, of the Company’s existing joint
ventures.

The Company exercises varying and evolving degrees of control
in the consortia, joint ventures and equity holdings in which
it participates. While the Company seeks to participate onlyin ventures in which its interests are aligned with those of its
partners, the risk of disagreement or deadlock is inherent in ajointly controlled entity, particularly in those entities that require
the unanimous consent of all members with regard to majordecisions and specify limited exit rights. The other parties inthese entities may also be competitors of the Company, andthus may have interests that differ from those of the Company.

Product Liability and Warranty Claims
The Company designs, develops and produces a number ofhigh profile products of large individual value, particularly civil
and military aircraft and space equipment. The Company issubject to the risk of product liability and warranty claims in
the event that any of its products fails to perform as designed.
While the Company believes that its insurance programmes
are adequate to protect it from such liabilities, no assurances
can be given that claims will not arise in the future or that suchinsurance coverage will be adequate.
While the Company believes that its insurance programmes areadequate to protect it from such liabilities, claims may arise in
the future and insurance coverage related to such claims may
be inadequate. The Company follows a policy of seeking totransfer the insurable risk of the Company to external insurance
markets at reasonable rates, on customised and sufficient terms
and limits as provided by the international insurance markets.

The insurance industry remains unpredictable. There may
be future demands to change scope of coverage, premiums
and deductible amounts. No assurance can be given that theCompany will be able to maintain its current levels of coverage
nor that the insurance coverages in place are adequate to cover
all significant risk exposure of the Company.
Any problems in this respect may also have a significant adverse
effect on the reputation of the Company and lead to a decline
in demand for its products and services. Any reputational
damage faced by the Company may be exacerbated due tothe Company’s visibility.
The Company cannot predict at this time the impact on it asa result of any product liability or warranty claims as such will
depend on the nature and size of any such claim.

Intellectual Property
The Company continuously seeks to develop and deliver new
products to meet customers’ evolving needs, while also improving
its existing product lines. Technological innovation has been at
the core of the Company’s strategy since its creation. Airbus
innovations often provide distinct competitive advantages, withmany becoming standard in the aircraft industry. In addition, theCompany designs, develops and produces a number of highprofile products of large individual value, particularly civil andmilitary aircraft and space equipment. Therefore, intellectual
property (IP) is one of the Company’s most valuable assets andthe protection of IP is critical to its business.
The Company relies upon patents, copyright, trademark,confidentiality and trade secret laws, and agreements with its
employees, customers, suppliers and other parties, to establish
and maintain its IP rights in its products and services and in its
operations. Despite these efforts to protect its IP rights, any of20

Airbus / Registration Document 2018

the Company’s direct or indirect IP rights could be challenged,
invalidated or circumvented. Further, the laws of certain
countries do not protect the Company’s proprietary rights tothe same extent as the laws in Europe and the US. Therefore,
in certain jurisdictions the Company may be unable to protect
its proprietary technology adequately against unauthorised
third-party copying or use, which could adversely affect its
competitive position. The Company may also face lack of
certainty with respect to intellectual property rights for existingor new research and development programmes and establishedor potential partnerships with private or public organisations,academic institutions and research councils, charities andgovernment departments, where the relevant intellectual
property frameworks or user-rights/ownership governing thoserelationships is dependent on the UK’s status as a member stateof the European Union.

REGISTRATION DOCUMENT 2018
Risk Factors /In the event the Company is unable to adequately procure andprotect critical IP it could potentially not implement its businessstrategy.
The Company has been accused of infringement on occasion
and could have additional claims asserted against it in the
future. These claims could harm its reputation, result in financial
penalties or prevent it from offering certain products or services
which may be subject to such third-party IP rights. Any claims

4.

or litigation in this area, whether the Company ultimately
wins or loses, could be time-consuming and costly, harm
the Company’s reputation or require it to enter into licensing
arrangements. The Company might not be able to enter into
these licensing arrangements on acceptable terms. If a claim of
infringement were successful against it, an injunction might beordered against the Company, causing further losses.

Environmental, Health and Safety Risks

The Company’s expenditure associated with environmental
and health and safety challenges may increase due to bothincreased costs of compliance with regulations in those areas
as well as potential reputational and litigation risks.
Given the scope of its activities and the industries in which it
operates, the Company is subject to stringent environmental,
health and safety laws and regulations in numerous jurisdictions
around the world. The Company therefore incurs, and expects
to continue to incur, significant capital expenditure and otheroperating costs to comply with increasingly complex laws andregulations covering the protection of the natural environment
as well as occupational health and safety. Health and safety
expenditures include investments in the identification and theprevention, elimination or control of physical and psychologicalrisks to people arising from work, including chemical, mechanicaland physical agents. Risks that could arise from work activities
include the possibility of injury, physical and mental ill-health,damage to equipment, business interruption and regulatory
action. Any reputational risk and claims against the Company
that may result will also need to be managed and may leadto additional health and safety expenditure being required.
Environmental protection expenditures include costs to prevent,control, eliminate or reduce emissions to the environment,
waste management, the content of the Company’s products,
and reporting and warning obligations. Analysis of the current
trends shows that regulatory pressure on the international scene
to reduce the environmental footprint of industry is steadily
growing (circular economy and resources efficiency, energy
transition and climate change engagement, air and water
quality improvement). Moreover, new laws and regulations,the imposition of tougher license requirements, increasingly
strict enforcement or new interpretations of existing laws andregulations may cause the Company to incur increased capital
expenditure and operating costs in the future in relation to
the above, which could have a negative effect on its financial
condition and results of operations.
If the Company fails to comply with health, safety andenvironmental laws and regulations, even if caused by factors
beyond its control, that failure may result in the levying of civil or
criminal penalties and fines against it. Regulatory authorities may
require the Company to conduct investigations and undertake
remedial activities, curtail operations or close installations or

facilities temporarily to prevent imminent risks. In the event of
an industrial accident or other serious incident, employees,
customers and other third parties may file claims for ill-health,personal injury, or damage to property or the environment(including natural resources). Further, liability under some health,safety and environmental laws can be imposed retrospectively,on a joint and several basis, and, in relation to contaminatedsites, without any finding of non-compliance or fault. These
potential liabilities may not always be covered by insurance, or
may be only partially covered. The obligation to compensate forsuch damages could have a negative effect on the Company’s
financial condition and results of operations.
In addition, the various products manufactured and sold by
the Company must comply with relevant health, safety andenvironmental laws, for example those designed to protect
customers and downstream workers, and those covering
substances and preparations, in the jurisdictions in which they
operate. Although the Company seeks to ensure that its products
meet the highest quality standards, increasingly stringent andcomplex laws and regulations, new scientific discoveries,
delivery of defective products or the obligation to notify orprovide regulatory authorities or others with required information(such as under the EU Regulation known as “REACH”, which
addresses the production and use of chemical substances)
may force the Company to adapt, redesign, redevelop, recertify
and/‌or eliminate its products from the market thereby incurring
significant additional costs. Seizures of defective products may
be pronounced, and the Company may incur administrative, civil
or criminal liability. Any problems in this respect may also havea significant adverse effect on the reputation of the Company
and lead to a decline in demand for its products and services.
Despite compliance with all applicable laws and regulations, theCompany’s reputation and the demand for its products may also
be affected by the public perception of environmental impactsof the Company’s products in operation (such as the emissionof greenhouse gases or noise) and of the local environmental
impacts of Airbus and its supply chain industrial operations on
local air and water quality.
The Company cannot predict at this time, the impact on it as aresult of environmental or health and safety matters, and may
be adversely affected by them in the manner described above.

Airbus / Registration Document 2018

21

1
Chapter

22

Airbus / Registration Document 2018

1

Information on the
Company’s Activities
1.1
Presentation of the Company
1.1.1 Overview
1.1.2 Airbus (Commercial Aircraft)
1.1.3 Helicopters
1.1.4 Defence and Space
1.1.5 Investments
1.1.6 Insurance
1.1.7 Legal and Arbitration Proceedings
1.1.8 Non-Financial Information

24
24
28
36
39
45
46
46
48

Airbus / Registration Document 201823

Information on the Company’s Activities /1.1 Presentation of the Company

1.1 Presentation of the Company
1.1.1 Overview
Due to the nature of the markets in which the Company operates and the confidential nature of its businesses,
any statements with respect to the Company’s competitive position set out in paragraphs 1.1.1 through 1.1.5 below
have been based on the Company’s internal information sources, unless another source has been specified below.
With consolidated revenues of € 63.7 billion in 2018 and€ 12.5 billion for the three months ended 31 March 2019, theCompany is a global leader in aeronautics, space and related
services. Airbus offers the most comprehensive range ofpassenger airliners. The Company is also a European leader
providing tanker, combat, transport and mission aircraft, as wellas one of the world’s leading space companies. In helicopters,
the Company provides the most efficient civil and militaryrotorcraft solutions worldwide. In 2018, it generated 84.5% of
its total revenues in the civil sector (compared to 85% in 2017)
and 15.5% in the defence sector (compared to 15% in 2017).
As of 31 March 2019, the Company’s active headcount was
135,468 employees.

Strategy
2018 was the year Airbus operated as One Company after thecompletion of the Airbus Group and Airbus integration. Thisevolution simplified our company’s governance, eliminatedredundancies and supported further efficiencies, while at the sametime driving further integration of the entire group. The Company
overall will derive considerable benefit from the integration throughmore focused business support and reduced costs.
Airbus Defence and Space continued to reshape its portfolio andrefocus on military aircraft, missiles, launchers and satellites. The
Company pursued the divestment process of the businesses
that do not fit with the new strategic goals and have better
futures in more tailored ownership structures. The Company
completed the divestment of its North American Airbus DS
Communications Inc. business.
Airbus Helicopters retained its leadership in civil and parapublicsegment and managed to increase its market share in military
segment, while operating in a challenging market environment.
The eight long term paths of the Company’s strategy remain
as follows:
1. Remain a leader in commercial aerospace, strengthenmarket position and profitability

24

a 50.01% majority stake in the aircraft programme. A220 aircraft
expand the Airbus single-aisle family to cover the 100-150 seat
segment – and respond to a worldwide market demand forsingle-aisle jetliners in that segment.
Despite challenges in the traditional helicopter market, Airbus
Helicopters has shown resilient performance, keeping its market
leadership in the civil & parapublic segments.
2. Preserve our leading position in European Defence, Spaceand Government markets by focusing on providing militaryplatforms, space assets, and associated services, as wellas through our participation in missile and launcher joint
ventures
The disproportionate scale of our commercial aircraft businesscompared to our Defence, Space and Government activities
has diluted the latter’s ability to serve as an effective tool tomanage and hedge against commercial cycles. Nevertheless,
the Company remains fully committed to serving its
institutional and government customers by actively shaping
and strengthening its Defence, Space and Government
businesses. The Company is doing so by: (i) leveraging
customer funding to develop and deliver high performance
military aircraft, space, and related service offerings as wellas through its participation in missile and launcher joint
ventures; and (ii) focusing on productivity improvements –both through internal means and in the context of European
industrial optimization – that will better position the Company
in Space and export markets.
In 2018, the Company worked with our government andinstitutional customers to anticipate and prepare competitive
next generation solutions – including in the domains of Future
Combat Air Systems, European MALE RPAS, Maritime Airborne
Warfare Systems, and space situational awareness – while
concurrently developing new digital and other services, e.g
SmartForce offerings that will improve availability and total
lifecycle costs of our military aircraft fleets.
On military markets, Airbus Helicopters also showed strong
performance, as market share increased.

The commercial aircraft business aims to be largely self-sufficient
going forward. Focus upon on-time, on-cost and on-quality
deliveries is paramount given the huge backlog execution
challenge (over 7,500 aircraft). Airbus aims to further strengthen
its position through focusing on digitalisation, innovation, services,
improving our industrial system, and a more global approach.

3. Pursue incremental innovation potential within productprogrammes while pioneering and fostering disruptions
in our industry, and developing necessary skills andcompetencies required to compete in the future

On 1 July 2018, Airbus announced the closing of the A220
(formerly known as C Series) transaction between Airbus SAS,
Bombardier Inc. and Investissement Québec. Airbus now owns

Airbus innovates every day to increase its value propositions
by enhancing product performance, creating new customer
benefits and reducing costs. Our cutting-edge technologies

Airbus / Registration Document 2018

REGISTRATION DOCUMENT 2018
Information on the Company’s Activities /1.1 Presentation of the Company

and scientific excellence contribute to global progress andto delivering solutions for society’s challenges, such asenvironmental protection, mobility and safety.
After many new product developments in recent years, themajority of the Company’s revenues are generated today insegments where we have competitive, mature products thatare far from the end of their lifecycle. Innovation will therefore
target maintaining, expanding and continually leveraging thecompetitiveness of these products.
In addition, the Company raised its ambitions to pioneer anddisrupt the aerospace industry in areas that will shape the market
and our future and made a substantial effort in breakthroughinnovation.
A prime example of how the Company leads disruption in theaerospace industry is Urban Air Mobility, “UAM”: we expect alarge-scale market to emerge by adding the third dimension
to transport options in megacities. This will require new endto-end solutions combining electrical Vertical Take Off andLanding “eVTOL” vehicles, self-piloting/automation, and adigital, services driven economy with new mobility-as-a-service
business models and seamless integration into other transportsystems. Starting around 2014, the Company has madesignificant progress on technical solutions (e.g., eVTOL vehicle
demonstrators, air traffic management, infrastructure) andbusiness aspects (disruptive strategy, on-demand helicoptertransport, policy making support) and has become a precursor
in the field.
4. Exploit digitalisation to enhance our current businessas well as pursue disruptive business models
Digitalisation will support the Company’s transformation
by focusing on five main axes: (i) enabling high employee
engagement, (ii) digital operational excellence, (iii) mastering
our product data value chain and turning product data into
insight, (iv) capturing the end-user experience and (v) driving
our business agility.
Airbus launched Skywise, a data platform in collaboration withpioneers in data integration and advanced analytics. Skywise
has established an early lead in the race to connect the aviationindustry since its launch in 2017 at the Paris Air Show. Skywise
aims to become the single platform of reference used by all major
aviation players to improve their operational performance andbusiness results and to support their own digital transformation.
In 2018, Airbus Defence and Space together with Airbus
Helicopters launched the SmartForce suite of services to enable
military operators to exploit the data gathered by their aircraft
to enhance operational safety, boost mission availability andreduce maintenance support costs.
5. Adapt to a more global world as well as attract and retain
global talents
The Company has a worldwide presence in 38 countries. The
number of employees employed outside core countries is circa
15,300 and this will continue to grow. In Canada alone ournumbers have increased significantly from 152 in 2017 to about
2,300 employees in 2018 following our C Series Joint Venturewith Bombardier.

An important aspiration for the Company with a global workforce
is to build on its diversity and multicultural teams to support
our Industrial cooperation, help us anticipate and respond togeopolitical changes. Our desire to move from an ethnocentric
to a geocentric approach is reflected in our mobility strategy
which aims to enrich our founding countries with international
talents. Our “Regional Focus Reviews” is another platform
used to identify and develop our top talents in all regions andencourage inter and intra mobilities between our regions andfounding countries.

1

Other key programmes introduced are as follows:–– iJet: launched in 2017 to create customised development
programmes to accelerate the career of our top juniorinternational talents (internal);–– IGP: a two-year international development programme
aimed to attract young and talented individuals (external).
Our Airbus Global University Partner Programme connects a
global network of universities and aims to develop engineeringand technology specialists of the future. The programmecurrently covers 26 universities in 13 countries over 4 continents.
We are also looking at developing new innovative ideas for the
future like designing an end-to-end process between Airbus
Foundation and Airbus HR programmes to channel students
into Airbus jobs and to conduct a feasibility study on launchingan International Bursary Programme to inspire less privilegedchildren from countries such as Africa and India to study
aerospace engineering.
Last but not least, with a view to obtaining external perspectives,
the Company is building an external community of international
leadership profiles to facilitate open exchanges with theCompany.
6. Focus services on and around the Company’s platforms
The strategy going forward is to focus on services where theCompany can differentiate and add value for its customers
according to the motto “no one knows our products better thanwe”, aiming at developing long-term customer intimacy andbringing competitive advantage to its customers. As services are
executed locally, the portfolio will be adapted to the increasingly
global customer base. Cooperation with military customers is
set to increase substantially through maintenance and support
services thanks to the new platforms in the still growing fleet,which will include about 600 Eurofighters, over 170 A400M
aircraft, around 550 NH90s and over 200 Tiger helicopters.
Since 1974, Airbus has delivered close to 12,000 commercial
aircraft with over 7,500 still to be delivered. As the installed baseis expanding rapidly, new innovative services (power by thehour, maintenance, and training) are being offered successfully.
Airbus Helicopters is a typical example of a well-balanced
business mix between platform manufacturing and services.
Through the HCare service offer, Airbus Helicopters provides
material management, helicopter maintenance, technicalsupport, training and flight ops, and connected services.
Airbus Defence and Space is developing GEO-Information &GEO-Intelligence services to better cater not just to governments
but also commercial needs.

Airbus / Registration Document 201825

Information on the Company’s Activities /1.1 Presentation of the Company

7. Strengthen the value chain position
The Company’s core capability has been to master programmemanagement and architect / integrator capabilities in orderto design, develop, manufacture, market and service largescale aeronautics / space platforms and integrated systems.
As the Company performs a strong platform prime integratorrole, managing the supplier base to enable the delivery of ontime and on quality product to the final customer. We aim tostrengthen and optimise selected strategic value chain areas
to protect our intellectual property, manage risks, improvecustomer satisfaction, increase profit, offer services, build
competencies and differentiate our offerings. The Company’s
suppliers provide a large proportion of the value in our
products, necessitating a robust supply-chain governanceframework. This is supported by processes and tools that
foster partnership, risk mitigation and supplier performancedevelopment.
In order to secure our value chain position and maintain acompetitive advantage, the Company is continually assessing
its strategy with regard to topics such as, supplier selection,
dual source, make or buy, core non-core and M&A. This
allows the Company to offer and deliver the best productto the customer whilst consistently enhancing key bricks inthe value chain.
8. Focus on profitability, value creation and market position;no need to chase growth at any cost; actively manage
portfolio
Thanks to strong organic growth potential, mainly in thecommercial airplane business, Airbus is going through a seriesof production ramp-ups with associated financial needs. On
top of that, targeted investments are expected to help toposition the Company for the future. The financial strength of
the Company is vital for mastering these challenges, and toensure that we have enough room for manoeuvre for further
strategic moves. As a prerequisite, the Company must remain
attractive for investors, notably compared to its peers.

Organisation of the Company’s Businesses
The Company has organised its businesses into the following
three operating segments: (i) Airbus (formerly Commercial
Aircraft), (ii) Helicopters and (iii) Defence and Space. However, asa continuation of a number of integration and normalisation steps
that took place in 2012, 2013 and 2015, the Company merged
its Group structure with its largest division Commercial Aircraft.
The merger began mid-2017 and provided the opportunity tointroduce a single Airbus brand for the Company and all its
entities, effective since January 2017. In 2017, Airbus Group
SE’s name was changed to Airbus SE, following approval at
the Annual General Meeting. Therefore, Airbus SE together
with its subsidiaries is referred to as “the Company” and nolonger the “Group”. Consequently, the segment formerly known
as “Airbus Commercial Aircraft” is referred to as “Airbus”. In
this new set-up, the Company retains Airbus Defence andSpace and Airbus Helicopters as Divisions. The chart set
out in “— General Description of the Company and its Share
Capital — 3.3.6 Simplified Group Structure Chart” illustrates
the allocation of activities.

26

Airbus / Registration Document 2018

Airbus (Commercial Aircraft)
Airbus is one of the world’s leading aircraft manufacturersof passenger airliners. Across all its aircraft families Airbus’
unique approach ensures that aircraft share the highest
commonality in airframes, on-board systems, cockpits andhandling characteristics. This significantly reduces operating
costs for airlines.
Since it was founded in 1970 and up to the end of 2018,
Airbus has received net orders for 19,340 commercial aircraftfrom 414 customers around the world. In 2018, Airbus
delivered 800 aircraft (compared to 718 deliveries in 2017) andreceived 831 gross orders (compared to 1,229 gross orders
in 2017), or 41% of the gross worldwide market share (in value
terms) of aircraft with more than 100 seats (compared to 50%
in 2017). After accounting for cancellations, net order intake for2018 was 747 aircraft (compared to 1,109 aircraft in 2017). As
of 31 December 2018, Airbus’s backlog of commercial orders
was 7,577 aircraft (compared to 7,265 aircraft in 2017).
In 2018, Airbus recorded total revenues of € 47.97 billion– representing 75% of the Company’s revenues. See“— 1.1.2 Airbus”.
Helicopters
Airbus Helicopters is a global leader in the civil and militaryrotorcraft market, offering one of the most complete and modern
ranges of helicopters and related services. This product range
currently includes light single-engine, light twin-engine, medium
and medium-heavy rotorcraft, which are adaptable to all kindsof mission types based on customer needs.
Airbus Helicopters delivered 356 helicopters in 2018 (409
in 2017) and received 381 net orders in 2018 (compared to
335 net orders in 2017). Order intake amounted to € 5.95 billion(2017: € 6.23 billion). Civil contracts accounted for 43% of thisorder volume, with military sales representing the remaining
57%. At the end of 2018, Airbus Helicopters order book stoodat 717 helicopters (2017: 692 helicopters).
In 2018, Airbus Helicopters recorded total revenues of€ 5.93 billion, representing 9% of the Company’s revenues.
See “— 1.1.3 Helicopters”.
Defence and Space
Airbus Defence and Space is Europe’s number one defence andspace enterprise, one of the world’s leading space companies
and among the top 10 global defence enterprises. Defence
and Space puts a strong focus on core businesses: space,
military aircraft, missiles and related systems and services.
Airbus Defence and Space is organised in four ProgrammeLines: Military Aircraft; Space Systems; Communications,Intelligence & Security (CIS); and Unmanned Aerial Systems(UAS). It develops and engineers cutting-edge products in thefield of defence and space, enabling governments, institutions
and commercial customers alike to protect resources andpeople while staying connected to the world. Airbus Defence
and Space solutions guarantee sovereignty in foreign affairs
and defence matters.
In 2018, Airbus Defence and Space recorded total revenuesof € 11.1 billion, representing 17% of the Company’s revenues.
See “— 1.1.4 Defence and Space”.

REGISTRATION DOCUMENT 2018
Information on the Company’s Activities /1.1 Presentation of the Company

Summary Financial and Operating Data
The following tables provide summary financial and operating
data for the Company for the past three years and for the threemonth period ended 31 March 2019 and 2018, when available.
The 2017 financial information has been restated to reflect
the new segment structure. In addition, the 2017 financial
information has been restated under IFRS 15 when requiredby the standard.

The 2016 financial information has not been restated under
IFRS 15. See “— Management’s Discussion and Analysis ofFinancial Condition and Results of Operations — 2.1 Operating
and Financial Review”.

1

Additionally, the 2017 and 2016 figures for order intake and orderbacklog have not been restated for IFRS 15. See “— 2.1.3.2:
Order Intake and Order Backlog”.

REVENUE BY BUSINESS SEGMENT
Three-month Three-month
period ended period ended
31 March 2019 31 March 2018
(unaudited)(unaudited)(In € million)

Year ended
31 December
2018Year ended
31 December
2017
as restatedYear ended
31 December
2017
as reported

Year ended
31 December
2016
as reported

Airbus

9,697

7,222

47,97043,48650,95849,237

Airbus Helicopters

1,007

961

5,934

6,335

6,450

6,652

Airbus Defence and Space
Subtotal segmental revenue
Transversal / Eliminations(1)

Total

2,112

2,217

11,063

10,596

10,804

11,854

12,816

10,40064,96760,417

68,212

67,743

(267)

(281)

(1,260)(1,395)(1,445)(1,162)

12,549

10,11963,70759,022

66,767

66,581(1) “Transversal / Eliminations” comprises activities not allocable to the reportable segments, combined together with consolidation effects.

REVENUE BY GEOGRAPHICAL AREAS
Three-month
period ended
31 March 2019
(unaudited)Three-month
period ended
31 March 2018
(unaudited)Year ended
31 December
2018Year ended
31 December
2017
as restatedYear ended
31 December
2017
as reported

Year ended
31 December
2016
as reported(In € billion) (In %)(1) (In € billion) (In %)(1) (In € billion) (In %)(1) (In € billion) (In %)(1) (In € billion) (In %)(1) (In € billion) (In %)(1)

Asia / Pacific

4.5 36.0%

2.6 25.7%

23.3 36.6%

Europe4.3 34.4%

3.4 33.7%

17.8 27.9%

North America

2.3 18.4%

2.0 19.8%

11.1

17.4%

Other countries(2)

1.4

11.2%

2.1 20.8%

11.5

18.1%

12.5 100%

10.1 100%

63.7 100%

Total

21.3 36.1%

24.8 37.2%

21.3 32.0%

15.8 26.8%

17.0 25.4%

21.4

10.8 18.3%

12.6 18.9%

8.9 13.4%

11.1 18.8%

12.4 18.5%

15.0 22.5%

59.0 100%66.8 100%

66.6 100%32.1%(1) Percentage of total revenue after eliminations.
(2) Including the Middle East.

ORDER INTAKE BY BUSINESS SEGMENT(1)Year ended
31 December 2018
(In € billion) (In percentage)(2)Year ended
31 December 2017

Year ended
31 December 2016

(In € billion) (In percentage)(2)(In € billion) (In percentage)(2)

Airbus

41.5

73.7%

143.4

90.3%

114.9

Airbus Helicopters

6.3

11.3%

6.5

4.1%

6.1

84.3%
4.4%

Airbus Defence and Space

8.4

15.0%

8.9

5.6%

15.4

11.3%

Subtotal segmental order intake

56.3

100%

158.8

100%

136.4

100%

Transversal / Eliminations

(0.8)

(1.1)

(1.9)

Total

55.5

157.7

134.5

(1) Without options.
(2) Before “Transversal / Eliminations”.

Airbus / Registration Document 201827

Information on the Company’s Activities /1.1 Presentation of the Company

ORDER BACKLOG BY BUSINESS SEGMENT(1)Year ended
31 December 2018
(In € billion) (In percentage)(2)

AirbusYear ended
31 December 2017

Year ended
31 December 2016

(In € billion) (In percentage)(2)

411.7

89.1%

950.4

Airbus Helicopters

14.9

3.2%

11.2

1.1%

11.3

1.1%

Airbus Defence and Space

35.3

7.7%

37.4

3.8%

41.5

3.9%

Subtotal segmental order backlog

461.9

100%

999.0

100%

1,063.0100%

Transversal / Eliminations

Total

95.1%

(In € billion) (In percentage)(2)

1,010.2

(2.4)

(2.1)

(2.6)

459.5

996.8

1,060.4

95.0%(1) Without options.
(2) Before “Transversal / Eliminations”.

Relationship between Airbus SE and the Company
In line with the previous organisational structure, Airbus SE
itself does not engage in the core aerospace, defence or spacebusiness of the Company but coordinates related businesses,
sets and controls objectives and approves major decisions for
the Company. As the parent company, Airbus SE conducts
activities which are essential to the Company’s activities andwhich are an integral part of the overall management of theCompany. In particular, finance activities pursued by Airbus SE
are in support of the business activities and strategy of theCompany. In connection therewith, Airbus SE provides or
procures the provision of services to the subsidiaries of theCompany. General management service agreements have been

put in place with the subsidiaries and services are invoiced ona cost plus basis.
For management purposes, Airbus SE acts through its Board of
Directors, Executive Committee, and Chief Executive Officer inaccordance with its corporate rules and procedures as described
below under “— Corporate Governance — 4.1 Management
and Control”.
Within the framework defined by Airbus SE, Airbus, each Division,
Business Unit and subsidiary is vested with full entrepreneurial
responsibility.

1.1.2 Airbus (Commercial Aircraft)
Airbus is one of the world’s leading aircraft manufacturers ofpassenger airliners. In order to help shape the future of airtransportation and drive steady growth around the world.
Airbus seeks incremental innovative technological solutions
and the most efficient sourcing and manufacturing possible– so airlines can grow and people can connect. Airbus’
comprehensive product line comprises successful families ofjetliners ranging in capacity from 100 to more than 600 seats:
the A220 Family (formerly Bombardier Inc.’s C Series); the A320
Family, which is civil aviation’s best-selling product line; the A330
Family, including the advanced A330neo; the new-generation
widebody A350 XWB; and the double-deck A380. Across its
aircraft families Airbus’ solutions ensure that aircraft share highcommonality in airframes, on-board systems, cockpits andhandling characteristics. This significantly reduces operating
costs for airlines. See “— 1.1.1 Overview” for an introduction
to Airbus.
Airbus’ global presence includes, on top of France, Germany,
Spain and the United Kingdom, fully-owned subsidiaries in
the United States, China, Japan, India and in the Middle East,and spare parts centres in Hamburg, Frankfurt, Washington,
Beijing, Dubai and Singapore. Airbus also has engineering andtraining centres in Toulouse, Miami, Mexico, Wichita, Hamburg,
Bangalore, Beijing and Singapore, as well as an engineering
centre in Russia. There are also hubs and field service stations

28

Airbus / Registration Document 2018

around the world. Airbus also relies on industrial co-operationand partnerships with major companies and a wide network ofsuppliers around the world.

Strategy
Airbus’ primary goal is to deliver strong results in a sustainedmanner, while commanding a further increased share of theworldwide commercial aircraft market over the long-term andexpanding its customer services offering. To achieve thesegoals, Airbus is actively:
Developing the Most Comprehensive Line of Products
in Response to Customer Needs
Airbus continuously seeks to develop and deliver new products
to meet customers’ evolving needs, while also improving its
existing product line. Several products entered into service
in 2018:
A321LR, extending the capabilities of the A320 Single--theAisle Family in order to maintain its position as the mostadvanced and fuel-efficient single-aisle aircraft family;

A330neo (new engine option), the new generation of the--theA330 Family;
A350-900 ULR (Ultra Long Range), variant of the A350--theXWB capable of flying up to 9,700 nautical miles;

REGISTRATION DOCUMENT 2018
Information on the Company’s Activities /1.1 Presentation of the Company

A350-1000, Airbus’ latest and largest widebody in the--thetwin-aisle category.
To support the A350 XWB ramp-up and other production
increases, a new super transporter is under development, withthe first of five Beluga XL aircraft to enter into service in 2019.
The first flight of the Beluga XL took place in July 2018.
Airbus remains at the forefront of the industry by expanding its
customer services offering – see Customer Services.
Building a Leaner, More Fully Integrated Company
In order to build a leaner, more fully integrated company andthereby bolster its competitiveness, Airbus is adapting its
organisation to foster an entrepreneurial spirit and empower
more teams, while maintaining harmonised processes acrossall sites. For series programmes, additional responsibilities andmeans have been delegated to plants for delivery at increased
rates. Airbus also has become a more integrated company,
working towards one common culture across its global
workforce, as well as aligning processes and planning withthe global supplier base.

MarketMarket Drivers
The main factors affecting the commercial aircraft market include
passenger demand for air travel, cargo activity, economic
growth cycles, oil prices, national and international regulation(and deregulation), the rate of replacement and obsolescenceof existing fleets and the availability of aircraft financing sources.
The performance, competitive posture and strategy of aircraft
manufacturers, airlines, cargo operators and leasing companies
as well as wars, political unrest, pandemics and extraordinary
events may also precipitate changes in demand and lead toshort-term market imbalances.
According to internal estimates, demand for 37,400 passenger
and freight aircraft is forecast in the next 20 years with AsiaPacific accounting for 42% of deliveries. In recent years, China
and India have emerged as significant new aircraft markets. As
a result, Airbus has sought to strengthen its commercial andindustrial ties in these countries.
The no-frills / low-cost carriers also constitute a significant
sector, and are expected to continue growing around the world,
particularly in Asia, where emerging markets and continued
deregulation should provide increased opportunities. While
single-aisle aircraft continue to be a popular choice for thesecarriers, demand for Airbus’ range of twin-aisle aircraft may also
increase as some of these carriers develop or further develop
their long-range operations.
Overall growth. The long-term market for passenger aircraft
depends primarily on passenger demand for air travel, which
is itself primarily driven by economic or GDP growth, fare levels
and demographic growth. Measured in revenue passenger
kilometres, air travel increased in every year from 1967 to
2000, except for 1991 due to the Gulf War, resulting in an
average annual growth rate of 7.9% for the period. Demand
for air transportation also proved resilient in the years following
2001, when successive shocks, including 9/11 and SARS in
Asia, dampened demand. Nevertheless, the market quickly
recovered.

At the end of 2008 and in 2009, the financial crisis and global
economic difficulties witnessed resulted in only the third periodof negative traffic growth during the jet age, and a cyclical
downturn for airlines in terms of traffic (both passenger andcargo), yields and profitability.

1

More recently, air travel demand growth has maintained solid
momentum, supported by positive ongoing improvement inglobal economic conditions throughout the year. World real
GDP growth is projected to be at +3.2% in 2018, and forecast
to remain positive with +3.0% in 2019 and +2.9% in 2020.
Preliminary figures released at the end of 2018, by the International
Civil Aviation Organisation (ICAO), confirmed that some 4.3 billion
passengers made use of the global air transport network for theirbusiness, tourism needs or for simply visiting friends and relatives(VFR) in 2018. The annual passenger total is up 6.1% compared
to 2017 and the number of departures rose to approximately
38 million globally. World passenger traffic, expressed in termsof total scheduled revenue passenger-kilometres (RPKs), posted
an increase of 6.7% with approximately 8.2 trillion revenue
passenger kilometres performed.
Through its analysis Airbus continues to believe in the longterm growth potential of our industry. The commercial aviationindustry has been resilient to external shocks and traffic hasgrown X2.3 since 2000. Based on internal estimates, Airbus a
growth rate of 4.4% annually during the period 2018-2037. If theactual growth rate equals or exceeds this level, Airbus expects
that passenger traffic, as measured in revenue passenger
kilometres, will double in the next 15 years.
Cyclicality. Despite an overall growth trend in air travel, aircraft
order intake can vary significantly from year to year and withindifferent regions, due to the volatility of airline profitability,
cyclicality of the economy, aircraft replacement waves andoccasional unforeseen events which can depress demand for
air travel. However, new product offerings and growth acrossthe market has resulted in good levels of order activity in recent
years. For example, in 2018, Airbus added 747 net orders to
its order book, with orders for aircraft from all segments of themarket.
Despite some cyclicality in airline demand, Airbus aims to securestable delivery rates from year to year, supported by a strong
backlog of orders and a regionally diverse customer base. At theend of 2018, the backlog stood at 7,577 aircraft. Through carefulbacklog management, close monitoring of the customer baseand a prudent approach to production increases, Airbus has
successfully increased annual deliveries for 16 years running,
even through the economic crisis of 2008-2009.
Regulation / Deregulation. National and international
regulation (and deregulation) of international air services andmajor domestic air travel markets affect demand for passenger
aircraft as well. In 1978, the US deregulated its domestic airtransportation system, followed by Europe in 1985. The more
recently negotiated “Open Skies Agreement” between the
US and Europe, which became effective in 2008, allows any
European or US airline to fly any route between any city in the
EU and any city in the US. Other regions and countries arealso progressively deregulating, particularly in Asia. This trend
is expected to continue, facilitating and in some cases driving
demand. In addition to providing greater market access (which
may have formerly been limited), deregulation may allow for thecreation and growth of new airlines or new airline models, asAirbus / Registration Document 201829

Information on the Company’s Activities /1.1 Presentation of the Company

has been the case with the no-frills / low-cost airline model,
which has increased in importance throughout major domestic
and intra-regional markets since deregulation (e.g., in the US
and Europe).
Airline network development: “hub” and “point-to-point”
networks. Following deregulation, major airlines have sought
to tailor their route networks and fleets to continuing changes
in customer demand. Accordingly, where origin and destination
demand prove sufficiently strong, airlines often employ direct,
or “point-to-point” route services. However, where demand
between two destinations proves insufficient, airlines havedeveloped highly efficient “hub and spoke” systems, which
provide passengers with access to a far greater number of
air travel destinations through one or more flight connections.
The chosen system of route networks in turn affects aircraft
demand, as hubs permit fleet standardisation around both
smaller aircraft types for the short, high frequency and lower
density routes that feed the hubs (between hubs and spokes)
and larger aircraft types for the longer and higher density
routes between hubs (hub-to-hub), themselves large pointto-point markets. As deregulation has led airlines to diversify
their route network strategies, it has at the same time therefore
encouraged the development of a wider range of aircraft in orderto implement such strategies.
Airbus, like others in the industry, believes that route networks
will continue to grow through expansion of capacity on existing
routes and through the introduction of new routes, which will
largely be typified by having a major hub city at least at one endof the route. These new route markets are expected to be wellserved by the latest product offering, the A350 XWB. In addition,
the A380 has been designed primarily to meet the significant
demand between the major hub cities, which are often among
the world’s largest urban centres (such as London, Paris, NewYork and Beijing). Airbus has identified 58 major hub cities in
its current market analysis, with this number expected to growto over 95 by 2036. Airbus believes that it is well positioned tomeet current and future market requirements given its complete
family of products.
Alliances. The development of world airline alliances has
reinforced the pattern of airline network development describedabove. According to data from Ascend, a UK-based aviationindustry consultancy, one-third of the world’s jetliner seats
being flown today are operated by just 18 airlines. In the 1990s,
the major airlines began to enter into alliances that gave eachalliance member access to the other alliance members’ hubs androutings, allowing airlines to concentrate their hub investments
while extending their product offering and market access.
Market Structure and Competition
Market segments. According to a study conducted by Airbus,
some 19,800 passenger aircraft with more than 100 seats werein service with airlines worldwide at the beginning of 2018.
Currently, Airbus competes in each of the four principal market
segments for aircraft with more than 100 seats.
“Small” aircraft, such as the A220 and A320 Families, having 100
to more than 200 seats, and which are used principally for shortrange and medium-range routes of up to 3,000 nautical miles.
“Medium” aircraft typically offering up to 300 seats on routes of
up to 5,000 nautical miles. This includes long range versions of
the A220 and A320 as well as the A330 family.

30

Airbus / Registration Document 2018

“Large” aircraft, such as the A330’s and variants of the A350900 XWB. These families are typically configured with two aisles
and seat up to 350 on routes of up to 10,000 nautical miles.
“Very Large aircraft”, such as the A350-1000 and A380, aredesigned to carry more than 350 passengers and also tooperate on routes of up to 10,000 nautical miles.
Freight aircraft, which form a fifth, related segment, are a
combination of new build and converted ex-passenger aircraft.
Converted aircraft are prevalent in the expanding e-commercemarket which typically sees relatively low aircraft utilization. Thiscan provide an economical “second life” for in-service aircraftfrom the A320 and A330 families. See “— Regional Aircraft,
Aerostructures, Seats and Aircraft Conversion — EFW”.
Airbus also competes in the corporate, VIP business jetmarket with the ACJ. Airbus continues to develop corporate
jet versions of its modern airliner family, notably the ACJ319neo
and ACJ320neo, as well as offering new variants, such as the
ACJ330neo and ACJ350 XWB. The increased range of theseaircraft extends Airbus’ leadership in cabin comfort to evenlonger flights. First flight of the ACJ320neo took place on
16 November 2018 with the first aircraft delivered on 16 January
2019.
Airbus’ ACJ319neo will fly eight passengers 6,750 nm/12,500 km
or 15 hours, while the ACJ350 XWB can transport 25 passengers
for 10,800 nm/20,000 km or 22 hours.
An ACJ Service Centre Network is progressively being
implemented, building on Airbus’ philosophy of customer care.
More than 200 Airbus aircraft operate worldwide in service withcompanies, individuals and governments.
Geographic differences. The high proportion of single-aisle
aircraft in use in both North America and Europe reflects the
predominance of domestic short-range and medium-range
flights, both from the expansion of the low-cost carrier andparticularly in North America due to the development of hubs
following deregulation. In comparison with North America andEurope, the Asia-Pacific region uses a greater proportion oftwin-aisle aircraft, as populations tend to be more concentrated
in fewer large urban centres. The tendency towards use of twinaisle aircraft is also reinforced by the fact that many of theregion’s major airports limit the number of flights, due either
to environmental concerns or to infrastructure constraints that
limit the ability to increase flight frequency. These constraints
necessitate higher average aircraft seating capacity per flight.
However, Airbus believes that demand for single-aisle aircraft in
Asia will grow over the next 20 years, particularly as domestic
markets in China and India and low-cost carriers continue todevelop in the region. Aircraft economics will also help to drive
aircraft size, with airlines looking to reduce the cost per seatthrough higher density aircraft cabins and the use of larger
aircraft types and variants where possible.
Competition. Airbus has been operating in a duopoly since
Lockheed’s withdrawal from the market in 1986 and Boeing’s
acquisition of McDonnell Douglas in 1997. As a result, the market
for passenger aircraft of more than 100 seats has been divided
between Airbus and Boeing. According to the manufacturers’
published figures for 2018, Airbus and Boeing, each accounted
for 50% of total commercial aircraft deliveries, 46% and 54% of
total net orders (in units), and 56% and 44% of the total yearend backlog (in units). With 800 deliveries, 2018 was Airbus’
16th year in a row of increased production.

REGISTRATION DOCUMENT 2018
Information on the Company’s Activities /1.1 Presentation of the Company

Nevertheless, the high technology and high value nature of
the business makes aircraft manufacturing an attractive
industry in which to participate, and besides Boeing, Airbus
faces international competitors. Regional jet maker Embraer,
coming from the less than 100-seat commercial aircraft
market, continues to develop larger airplanes and is working
towards a strategic partnership with Boeing. Additionally, othercompetitors from Russia, China and Japan will enter the 70 to
150 seat aircraft market over the next few years, and today are
studying larger types.
In October 2017, Airbus SE and Bombardier Inc. agreed to forma partnership in relation to the C Series. Having received all
required regulatory approvals, Airbus SE, Bombardier Inc. andInvestissement Québec closed the C Series transaction effective
on 1 July 2018 and as a result, the Company has acquired amajority stake in the C Series Aircraft Limited Partnership.
The partnership brings together two complementary productlines, the A220-100 and A220-300, targeting the 100-150 seatmarket segment with an addressable market of at least 7,000
new aircraft over the next 20 years in the segments in which
they compete.
The Mirabel-based partnership benefits from Airbus’ global
reach, scale, procurement organisation and expertise in selling,
marketing and producing the A220. Significant production
efficiencies are anticipated by leveraging Airbus’ production
ramp-up expertise.
Customers
As of 31 December 2018, Airbus had 414 customers and a
total of 19,340 Airbus aircraft had been ordered, of which
11,763 aircraft had been delivered to operators worldwide. The
table below shows Airbus’ largest commitments in terms of total
gross firm orders by customer for the year 2018.
Customer

Firm orders(1)(2)Avolon100

Jetblue Airways

60

Moxy

60

Vietjet Air

50

Scandinavian Airlines

36

Lufthansa

32

Aegean Airlines

30

Delta Air Lines

25

Turkish Airlines

25

Viva Aerobus

25

Products and Services
The Family Concept — Commonality across the Fleet

1

Airbus’ aircraft families promote fleet commonality. Thisphilosophy takes a central aircraft and tailors it to create
derivatives to meet the needs of specific market segments,
meaning that the A320, A330, A350 and A380 all share thesame cockpit philosophy, fly-by-wire controls and handlingcharacteristics. Pilots can transfer among these aircraft within
the Airbus family with minimal additional training. Cross-crewqualification across families of aircraft provides airlines withsignificant operational flexibility. In addition, the emphasis on
fleet commonality permits aircraft operators to realise significant
cost savings in crew training, spare parts, maintenance andaircraft scheduling. The extent of cockpit commonality within
and across families of aircraft is a unique feature of Airbus that,in management’s opinion, constitutes a sustainable competitive
advantage.
In addition, technological innovation has been at the coreof Airbus’ strategy since its creation. Each product in the
Airbus family is intended to set new standards in areas crucial
to airlines’ success, such as cabin comfort, cargo capacity
performance, economic performance, environmental impact
and operational commonality. Airbus innovations often provide
distinct competitive advantages, with many becoming standard
in the aircraft industry.
A220 Family. Complementing the A320 Family, the A220-100
and A220-300 models cover the segment between 100 and 150
seats and offer a highly comfortable five-abreast cabin. With themost advanced aerodynamics, CFRP materials, high-bypass
engines and fly-by-wire controls, the A220 delivers 20 percent
lower fuel burn per seat compared with previous generation
aircraft. The type will serve a worldwide market for smaller
single-aisle airliners, estimated at least at 7,000 such aircraft overthe next 20 years. Airbus manufactures, markets and supports
A220 aircraft under the “C Series Aircraft Limited Partnership”(formerly CSALP; Airbus Canada Limited Partnership as of
1 June 2019) agreement, finalised in 2018.

(1) Options are not included in orders booked or year-end backlog.
(2) Excludes undisclosed customers.

Airbus / Registration Document 201831

Information on the Company’s Activities /1.1 Presentation of the Company

A220 FAMILY TECHNICAL FEATURES (CURRENT VERSION)
Model

Entry-into-service

Passenger capacity(1)Range (km)Length (metres)

Wingspan (metres)

A220-100

2016

116

2,950

35.0

35.1

A220-300

2016

141

3,200

38.7

35.1

(1) Two-class layout.

A320 Family. With more than 15,000 aircraft sold, and nearly
8,700 delivered, the Airbus family of single-aisle aircraft, basedon the A320, includes the A319 and A321 derivatives, as well as
the corporate jet family (including new members ACJ319neo and
ACJ320neo). Each aircraft in the A320 Family shares the same
systems, cockpit, operating procedures and cross-section.
At 3.95 metres diameter, the A320 Family has the widest fuselage
cross-section of any competing single-aisle aircraft. This
provides a roomy six-abreast passenger cabin, a high comfort
level and a spacious under floor cargo volume. The A320 Family
incorporates digital fly-by-wire controls, an ergonomic cockpit
and a modern structural material selection. The A320 Family’scompetitor is the Boeing 737 series.
To ensure this market leader keeps its competitive edge, Airbus
continues to invest in improvements across the product line,
including development of the A320neo Family. The A320neo
incorporates many innovations including latest generationengines, Sharklet wing-tip devices and cabin improvements,
which together will deliver up to 20% in fuel savings comparedwith earlier A320 family aircraft. The A320neo received joint Type
Certification from the European Aviation Safety Agency (EASA)
and the Federal Aviation Administration (FAA) in November 2015.
The A320neo with Pratt & Whitney engines was the first variant
in the Neo Family to receive Type Certification. The A320neo
with CFM engines was certified in May 2016. The A321neo
with Pratt & Whitney engines received Joint Type Certificationin December 2016 and with CFM engines in March 2017. Type

Certification for the A319neo with CFM engines was achievedin December 2018 with the variant with the Pratt & Whitneyengine to follow.
The A320neo Family versions have over 95% airframe
commonality with the A320ceo (current engine option) versions,enabling them to fit seamlessly into existing A320 Family fleets– a key factor for Airbus customers and operators.
Since its launch in December 2010, the A320neo Family hasreceived 6,526 firm orders from 104 customers, with a total of
635 aircraft delivered to the end of 2018. A320neo deliveriescommenced in February 2016 followed by the first A321neo in
April 2017 and in November 2018 the first A321 LR. Overall,
the A320 family retains a 56% share of the backlog against the
Boeing 737 Family.
During 2018, Airbus received 577 gross orders for the A320
Family of aircraft and 541 net orders. In Q1 2019, grosscommercial aircraft orders totaled 62 and net commercial
aircraft orders totaled -58 after 120 cancellations
In October 2015, Airbus announced the decision to further
increase the production rate of the Single Aisle Family to
60 aircraft a month in mid-2019, in response to strong customer
demand and following thorough studies on production ramp-up
readiness in the supply chain and in Airbus’ facilities. At theend of the first three months of 2019, the overall A320 Family
programme was on track to reach this rate in mid-2019 andpreparing for rate 63 in 2021.

A320 FAMILY TECHNICAL FEATURES (CURRENT VERSION)
Model

Entry-into-service

Passenger capacity(1)Range (km)Length (metres)

Wingspan (metres)

A318

2003

107

5,750

31.4

34.1

A319

1996

124

6,950

(2)

33.8

35.8

A320

1988

150

6,100(2)37.6

35.8(3)

A321

1994

185

5,950(2)44.5

35.8(3)

140

6,950

33.8

35.8

A319neo
A320neo

2016

165

6,500

37.6

35.8

A321neo

2017

206

7,400

44.5

35.8

(1) Two-class layout.
(2) Range with sharklets.
(3) Wingspan with sharklets.

A330 Family. With 1,734 aircraft sold (of which 238 A330neo)
and 1,439 delivered, the A330 Family covers all market segmentswith one twin-engine aircraft type and is designed to carry
between 247 and 287 passengers. The A330 Family offers highlevels of passenger comfort as well as large under-floor cargo
areas. The competitors of the A330 Family are the Boeing 767,
777 and 787 aircraft series.

32

Airbus / Registration Document 2018

The newest evolution to the A330 Family is the A330neo (newengine option), comprising the A330-800neo and A330-900neo
versions. These aircraft incorporate latest generation RollsRoyce Trent 7000 engines and enhanced aerodynamics for
improved fuel efficiency. The first flight took place in October 2017and both Type Certification and first delivery were achievedin 2018, with TAP taking delivery of its first three A330-900s
during the year. The final assembly of the A330-800 started
in November 2017 and the aircraft performed its first flight on
6 November 2018.

REGISTRATION DOCUMENT 2018
Information on the Company’s Activities /1.1 Presentation of the Company

Airbus is continuously developing the A330 Family to keep theaircraft at the leading edge of innovations and future versionsof the A330neo will offer increased take-off weight of up to
251 tonnes, offering a 15,000 km range for the A330-800.

In 2018, Airbus received 37 gross orders (27 net) for the A330
Family of aircraft including 18 for the A330neo, and delivered
49 aircraft to customers. In the first three months of 2019,
5 A330 aircraft were delivered, including 3 A330neos.

1

A330 FAMILY TECHNICAL FEATURES (CURRENT VERSION)
Model

Entry-into-service

Passenger capacity(1)Maximum range (km)Length (metres)

Wingspan (metres)

A330-200

1998

247

13,45058.8

60.3

A330-300

1994

277

11,750

63.7

60.3

257

13,900

58.8

64

2018

287

12,13063.7

64A330-800neo
A330-900neo(1) Three-class configuration.

A350 XWB Family. The A350 XWB is an all-new family of widebody aircraft, designed to accommodate between 325 and366 passengers. The A350 XWB features a wider fuselage
than that of competing new generation aircraft, Rolls-Royce
Trent XWB engines, A380 technology and over 50% composite
material. The A350 XWB’s main competitors are the Boeing 787
and 777 aircraft series.
With the Ultra-Long Range (ULR) version of the A350-900
launched in 2015, the A350 XWB demonstrates its versatility
by offering the capability to perform flights of up to 19 hours.

The first A350-900 ULR was delivered in September 2018 toSingapore Airlines.
Airbus has also developed the larger A350-1000, which is now
certified by EASA and the FAA and was delivered to its first
customer in February 2018 with a total of 14 aircraft delivered
during the year. In the first three months of 2019, Airbus delivered
22 A350 XWB aircraft.
In 2018, Airbus received 62 gross orders for the A350 XWBFamily (40 net), and delivered 93 aircraft, achieving the target
rate of 10 aircraft per month by the end of the year.

A350 XWB FAMILY TECHNICAL FEATURES
Model

Entry-into-service

Passenger capacity(1)Maximum range (km)Length (metres)

Wingspan (metres)

A350-900

2014

325

15,00066.8

64.8

A350-1000

2018

366

15,55773.8

64.8(1) Three-class layout.

A380. The double-deck A380 is the world’s largest commercial
aircraft flying today. Its cross-section provides flexible andinnovative cabin space, allowing passengers to benefit fromwider seats, wider aisles and more floor space, tailored to theneeds of each airline. Carrying 575 passengers in a comfortablefour-class configuration and with a range of 8,000 nm /14,800 km, the A380 offers superior economic performance,
lower fuel consumption, less noise and reduced emissions. The
A380’s competitor is the Boeing 747-8.

In 2018, Airbus Commercial Aircraft delivered 12 aircraft. In thefirst three months of 2019, Airbus delivered 1 A380 aircraft.
In February 2019, following a review of its operations, and in lightof developments in aircraft and engine technologies, Emirates
reduced its A380 orderbook from 162 to 123 aircraft. Emirates
will take delivery of 14 further A380s over the next two years.
As a consequence and given the lack of order backlog withother airlines, Airbus will cease deliveries of the A380 in 2021.

A380 TECHNICAL FEATURES
Model

Entry-into-service

Passenger capacity(1)Maximum range (km)Length (metres)

Wingspan (metres)

2007

575

14,80072.7

79.8

A380-800(1) Four-class layout.

Customer Services
Airbus seeks to remain at the forefront of the industry by
expanding its customer services offering to meet customers’
evolving needs. As a result, Airbus has developed a wide rangeof customer centric and value-added services. This approachprovides Airbus operators with solutions to significantly reduce
their operating costs, increase aircraft availability, enhance thequality of their operations and passenger experience.

Customer Services’ primary role is to support its customers
in operating their Airbus fleet safely and profitably and to
the satisfaction of passengers all around the world. As aresult of its continued growth, Airbus’ customer base has
increased consistently over the past years reaching more than
10,700 aircraft in operation by the end of 2018 operated bymore than 430 operators. The fleet is maintained by more than
100 Maintenance and Repair Organisations and partially owned
by 100 leasing companies.

Airbus / Registration Document 201833

Information on the Company’s Activities /1.1 Presentation of the Company

A worldwide network of more than 6,500 people cover all areasof support from technical engineering / operational assistanceand spare parts supply to crew and maintenance training.
Hundreds of technical specialists provide Airbus customers
with advice and assistance 24 hours a day, 7 days a week.
There are 142 field service stations available worldwide for onsite assistance to our operators, covering 159 operators. 216
operators are covered by 16 Hubs. Airbus worldwide support
is also based on an international network of support centres,
training centres and spares warehouses.
As the worldwide fleet is growing, so is the demand in theservices market. Airbus offers optimised aircraft operational
availability, streamlined flight operations and enhanced
passenger experience by covering the full aircraft lifecycle andfocusing on adding value to its customers. Growing fast on
the market with organic growth, JVs, co-developments andacquisitions in recent years, here are some examples:in 2016, full acquisition of Navtech, now re-named Navblue,
offering products in the Flight Operations area;in 2017, full acquisition of Sepang Aircraft Engineering (SAE),an MRO centre based in Kuala Lumpur, Malaysia, that had
been partially owned by Airbus since 2011;
launch of Airbus Interiors Services (2017) specialised intimely and flexible solutions for cabin equipments. For its firstparticipation in the Crystal Cabin Award 2018, Airbus Interiors
Services was among the finalists of the “Visionary Concepts”
category, presenting its novel “Day & Night” concept seat;
the Airbus MRO alliance was launched in 2017;
the Airbus Training network has tripled in the last three years
and currently counts 17 training network locations around theworld, the latest acquisition being a flight training center in
Denver, Colorado (January 2018). In December 2018, Airbus
and the French Civil Aviation University, ENAC, have obtained
EASA certification for a co-developed Ab initio Pilot Cadet
Training Programme that will be used by a worldwide networkof partner flight schools, starting with the first customer
Escuela de Aviacion Mexico (EAM) in Mexico City early 2019;
Airbus’ worldwide support is also based on an international
network of support centres, training centres and spares
warehouses all around the world, offering customers thesolutions they need close to their operational base. To ensure
this proximity Airbus empowered local teams and developed
hubs in the regions, most recently in Asia and China;
since the launch of Skywise at Le Bourget in 2017, Airbus has
accelerated with its digital transformation. In October 2018,
Airbus created the Skywise campus – “a place to foster internaland external collaboration” – and developing new ways ofworking, with customers at the heart of each service, to offer
the best value proposition across the full lifecycle, securing
and optimising their operations end-to-end, providing tailoredsolutions that deliver impactful outcomes and enhancing theuser’s experience all along the way.

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Skywise brings all the ecosystem data to a single platform. 52
customers have now chosen Skywise, representing a potentialof over 4,000 aircraft connected.
Leveraging on Skywise digital capabilities, Airbus’ Customer
Services portfolio offer is evolving to provide the best and mostefficient solutions available on the market:
FHS powered by Skywise: stepping-up services capabilities
with digital Skywise (April 2018);
launch of Skywise Reliability Services (October 2018);
launch of Skywise Predictive Maintenance (October 2018).

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Preparing the future of Airbus Services, at the Farnborough 2018
Air show Airbus presented its route to US$ 10 billion revenues
in the next decade, to further address market needs.
Customer Finance
Airbus favours cash sales, and does not envisage customer
financing as an area of business development. However, Airbus
recognises the commercial need for manufacturers to assist
customers in arranging financing of new aircraft purchases,
and in certain cases to participate in financing those aircraft
for the airline.
Extension of credit or assumption of exposure is subject tocorporate oversight and monitoring, and follows strict standardsof discipline and caution. Airbus’ dedicated customer financeteam has accumulated decades of expertise in aircraft finance.
When Airbus finances a customer, the financed aircraft generally
serves as collateral, with the engine manufacturer participatingin the financing. These elements assist in reducing the risk borne
by Airbus. The difference between the gross exposure resulting
from the financing and the collateral value is fully provisioned for(for further information, please refer to the “— Notes to the IFRS
Consolidated Financial Statements — Note 25: Sales Financing
Transactions”). Airbus’ customer financing transactions aredesigned to facilitate subsequent sell-down of the exposure to
the financial markets, third-party lenders or lessors.
In 2018, Airbus continued to benefit from market appetite
for both aircraft financing and sale and leaseback lessor
opportunities, supported by a high level of liquidity available inthe market at good rates for Airbus aircraft. Airbus customer
financing exposure remained limited in 2018 and decreased
compared to 2017. Airbus will continue to provide direct aircraft
financing support as it deems necessary. Management believes,in light of its experience, that the level of provisioning protecting
Airbus from default costs is adequate and consistent withstandards and practice in the aircraft financing industry. See“— Risk Factors – Financial Market Risks – Sales Financing
Arrangements”.
Asset Management
The Asset Management department was established in 1994 to
manage and re-market used aircraft acquired by Airbus, originallyas a result of customer bankruptcies, and subsequently in thecontext of certain buy-back commitments. The department
operates with a dedicated staff and manages a fleet comprisedof used aircraft across a wide range of models. Through its
activities, the Asset Management department helps Airbus torespond more efficiently to the medium- and long-term fleet
requirements of its customers.
Its key roles comprise commercial, technical and financial
risk management of its used aircraft portfolio, as well as theenhancement of all Airbus products’ residual value.
It also provides a full range of remarketing services, including
assistance with entry-into-service, interior reconfigurationand maintenance checks. Most of the aircraft are available tocustomers for cash sale, while some can also be offered on
operating lease. In the latter, the Airbus Asset Management teamaims at eventually selling down the aircraft with lease attachedto further reduce its portfolio exposure.
At the end of 2018, the Asset Management portfolio contained
15 aircraft, representing a 44% net portfolio reduction from 2017.

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Production
Industrial Organisation
Each task in the building of Airbus aircraft (from design toproduction) is allocated to a designated plant. The Airbus plants
are typically organised around different aircraft components
and sections, in component delivery teams. Each component
delivery team is either in charge of one aircraft programme, ororganised by manufacturing technology clusters dependingon the optimum solution for each plant. Every plant isorganised with production, engineering, quality, supply chain,manufacturing, engineering and logistics capabilities to ensure
a seamless production flow of operations.
A transversal “Industrial Systems” Centre of Competences
is in charge of ensuring that harmonised and standardised
processes, methods and tools are developed and implemented
across the plants, in order to increase efficiency, based on bestpractices. Another transversal “Manufacturing technologies”
Centre of Competences is in charge of disseminating newtechnologies and innovation in manufacturing across theplants and preparing manufacturing solutions for future productevolutions.
Following production by the respective plants, the various
aircraft sections are transferred between the network of sites
and the final assembly lines using dedicated transport means,such as the “Beluga” Super Transporters.
Programme management is then responsible for the final
assembly line activities. The programme management works
closely with the plants to secure delivery of aircraft sections to
the final assembly lines on time, cost and quality.
In 2018, construction started on the new FAL in Mobile, Alabama(US) for the A220. The first A220 delivery from Mobile is expectedin mid-2020.
Airbus announced the following programme production rates:

family: by next mid-decade, rate 10 per month targeted--A220in Mirabel and rate 4 per month targeted in Mobile;family: rate 60 per month targeted by mid-2019 with a--A320
4 A320 line in Hamburg, Mobile fully on schedule and Tianjinth(China) ramping- up further and preparing for rate 63 in 2021;
A350: rate 10 reached at the end of 2018;
A380: Airbus expects to deliver 8 aircraft in 2019, 7 in 2020
and the remaining 2 in 2021.

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Engineering
Airbus Engineering is a global organisation that develops civil
aircraft and aircraft components, and that conducts innovative
research applicable to the next generation of aircraft. Airbus
Engineering operates transnationally, with most engineers
employed in France, Germany, the UK and Spain. A growing
population of experienced aerospace engineers is also employedworldwide at five other engineering centres in Wichita (Kansas,
US), Mobile (Alabama, US), Moscow (Russia), Bangalore (India)
and Beijing (China).
A key part of the Airbus engineering organisation is the architect
and integration centre, which ensures, together with a team ofsenior aircraft architects and the programme chief engineers,that a consistent and multi-disciplinary approach is applied
during aircraft development.

Research & Technology activities continue to deliver incremental
innovations for existing aircraft, matured breakthroughtechnologies, with reinforced focus on industrial aspects. Airbus
Engineering is a major contributor to numerous international
initiatives dedicated to the preservation of the environment
and the reduction of noise and CO2 emissions. Fully integratedchange projects are also implemented to continuously
implement innovative and efficient ways of working.

1

Regional Aircraft, Aerostructures,
Seats and Aircraft Conversion
ATR
ATR (Avions de Transport Régional) is a world leader in themarket for regional aircraft up to 90 seats. Its aircraft are currently
operated by more than 200 airlines in over 100 countries. ATR
is an equal partnership between Airbus and Leonardo, with
Airbus’ 50% share managed by Airbus. Headquartered inToulouse, ATR employs more than 1,400 people. Since thestart of the programme in 1981, ATR has registered net orders
for 1,717 aircraft (483 ATR 42s and 1,234 ATR 72s).
In 2018, ATR delivered 76 new aircraft (compared to 78 in 2017)
and recorded net firm orders for 46 new aircraft (compared to 103
in 2017), including orders from NAC/Silver. As of 31 December
2018, ATR had a backlog of 205 aircraft (compared to 235 in2017).
Products and Services
ATR 42 and ATR 72. ATR has developed a family of highwing, twin turboprop aircraft in the 30- to 78-seat market
which comprises the ATR 42 and ATR 72, designed for optimal
efficiency, operational flexibility and comfort. Like Airbus, theATR range is based on the family concept, which provides
for savings in training, maintenance operations, spare parts
supply and cross-crew qualification. ATR is now entering thecargo market as 2018 is the year of the launch of the ATR72/F(Freighter) with a brand new windowless fuselage, a forward
Large Cargo Door (LCD) and a rear upper hinged cargo door.
First delivery is planned in 2020 to FedEx.
By the end of 2018, ATR had delivered 1,512 aircraft.
Customer service. ATR has established a worldwide customer
support organisation committed to supporting aircraft over theirservice life. Service centres and spare parts stocks are locatedin Toulouse, Paris, Miami, Singapore, Bangalore, Auckland,
Sao Paulo and Johannesburg. ATR worldwide presence also
includes representative offices in Beijing and Tokyo.
ATR Asset Management addresses the market for second-handaircraft by assisting in the placement and financing of usedand end-of-lease aircraft. ATR Asset Management activity ismarginal today as the leasing market has strongly developedsince 2007.
Production
The ATR fuselage is produced in Naples, Italy, and ATR wings
are manufactured in Merignac near Bordeaux, France. Finalassembly takes place in Saint Martin near Toulouse on the Airbus
commercial aircraft production site. Flight-testing, certificationand deliveries also occur in Toulouse. ATR outsources certain
areas of responsibility to Airbus, such as wing design andmanufacturing, flight-testing and information technology.

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Information on the Company’s Activities /1.1 Presentation of the Company

STELIA Aerospace
STELIA Aerospace is a wholly-owned subsidiary of Airbus.
It offers global solutions for aeronautical manufacturers andairlines supported by its aerostructure, cabin interior and pilot
seats business lines.
As one of the world leading tier-1 aerostructure suppliers,
STELIA Aerospace designs and manufactures fully integrated
aircraft sections for civil and military programmes.
From aircraft wings and fuselage sections, to fully equipped
and tested work packages, STELIA Aerospace is a global
partner for major aeronautical players worldwide, such as
Airbus, ATR, or Bombardier Aerospace.
With more than 7,000 employees worldwide, working
within 11 Centres of Excellence based in France, Canada,
Morocco and Tunisia, STELIA Aerospace has a wide range ofcapabilities, from Build-to-Print to Design & Build solutions,
including mechanical milling of rolled and stretched panels
and tubes & pipes covering all ATA systems.
Through its cabin interior specialty, STELIA Aerospace designs
and manufactures luxury First Class and Business Seats for
key partners in the world including Etihad Airways, Singapore
Airlines or Thaï Airways.
By combining innovative materials and technology with a drive
to improve the passenger experience, STELIA Aerospace hascreated an outstanding range of seats used in civil aircraft
globally.
STELIA Aerospace – a joint world leader Pilot seats
manufacturer – provides cockpit and pilot seats for all kindsof aircraft, and offers support from design to production,
including after-sales service.
As part of its development strategy, STELIA Aerospace hastaken a majority stake in Portalliance Engineering end of 2018.
Portalliance Engineering is an SME founded in 2006 andfocuses on modelisation and digital simulation of structural
calculation. This acquisition will enable STELIA Aerospace
to benefit sustainably from innovative digital solutions andstrengthen its position on the aerostructure market.

Premium AEROTEC
Premium AEROTEC is a wholly owned subsidiary of theCompany (consolidated within Airbus), is one of the world’s
leading tier-1 suppliers of commercial and military aircraft

structures and is a partner in the major European international
aerospace programmes.
Its core business is the development and production of large
aircraft components from aluminum, titanium and carbon fiber
composites (CFRP). Premium AEROTEC is Europe’s no. 1 inthis segment with roughly 10,000 employees at various sites inGermany and Romania. Premium AEROTEC is represented byits products in all Airbus commercial aircraft programmes. The
current military programmes include the Eurofighter “Typhoon”
and the new military transport aircraft A400M.
Besides main customer Airbus, Premium AEROTEC will further
intensify business with other customers and actively approachother aircraft or structural manufacturers. Premium AEROTEC
is also striving to expand its maintenance, repair and spareparts business.
In order to contribute successfully to the shaping of the
future of aviation, the engineers and developers at Premium
AEROTEC are continuously working on the new and further
development of lightweight and highly durable aircraft
structures. They cooperate closely with universities andresearch institutes in the process. Premium AEROTEC
plays a significant role in the design of new concepts in suchfields as carbon composite technologies (incl. thermoplastic
processes) or 3D-printing of aircraft components made oftitanium or aluminum.

Elbe Flugzeugwerke GmbH — EFW
EFW combines various aviation and technology activities
under a single roof: development and manufacturing of flat
fibre-reinforced composite components for structures andinteriors, the conversion of passenger aircraft into freighter
configuration, maintenance and repair of Airbus commercial
aircraft as well as engineering services in the context ofcertification and approval.
On 17 June 2015, Airbus signed an agreement with Singaporebased ST Aerospace Ltd. (STA) to offer passenger-to-freighter(P2F) conversion solutions for its A320 and A321 aircraft. STA
acquired an additional 20% of the shares of EFW, Dresden(Germany) by way of a contribution in kind and a capitalincrease to EFW. The transaction closed on 4 January 2016.
Consequently, 45% of the shares of EFW were retained andAirbus effectively lost its control over EFW (previously reported
in Airbus).

1.1.3 Helicopters
Airbus Helicopters is a global leader in the civil and militaryrotorcraft market, offering one of the most complete andmodern ranges of helicopters and related services. This productrange currently includes light single-engine, light twin-engine,
medium and medium-heavy rotorcraft, which are adaptable
to all kinds of mission types based on customer needs. See“— 1.1.1 Overview” for an introduction to Airbus Helicopters.

Strategy
Airbus Helicopters’ strategy is to continue driving improvement
initiatives via its company-wide digital transformation plan, whichplaces customer satisfaction, quality and safety at the core of
its operations, along with increasing industrial competitiveness.
A Commitment to Innovation
Development of the next-generation H160 medium helicopter –the first of the “H Generation” – is ongoing at a steady pace.

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Flight-test activities were carried out throughout 2018. The three
H160 prototypes have already accumulated over a 1,000 flight
hours in the final steps of the flight test campaign. The first
serial H160 has performed its first flight on 14 December 2018.
In 2018, products and services continued to be enhanced, withseveral initiatives such as the first H175 Public Services version
delivered in July 2018.
Airbus Helicopters is investigating future unmanned VTOL
(Vertical Take-off and Landing) systems. In that frame, Airbus
Helicopters is currently working on the design and developmentof the VSR700 unmanned aerial vehicle. The French Direction
Générale de l’Armement (DGA) has awarded a contract to theNaval Group and Airbus Helicopters consortium to identify,
deploy and test the necessary technologies for the integration ofa tactical drone-system capacity within a heavily armed vessel.
A first unmanned flight took place at the end of 2018.
Airbus Helicopters is also actively involved into the Urban Air
Mobility (UAM) via several commercial and military projects:
CityAirbus project, which is an electrically operated platform
concept for multiple passengers;
as part of Clean Sky 2 European Research programme,
Airbus Helicopters has unveiled at the Le Bourget airshow
the aerodynamic configuration of the high speed demonstrator
codenamed Racer. This demonstrator will incorporate a hostof innovative features and will be optimised for a cruise speedof more than 400 km/h.

---

Focusing on Customers
Airbus Helicopters achieved the second wave of its
transformation plan in 2018 by further enhancing customer
support and services, with safety as the top priority. This isunderscored by indicators like increasing fleet availability forcustomers and operators, or improved On Time Delivery rates
for spare parts.
The transformation, which began five years ago, continues toyield results in various areas, with the objective of responding
fully to customers’ requirements and over-achieve market
standards in terms of quality, safety, customer satisfaction andcompetitiveness. This transformation is and remains based on
fundamental requirements: quality and safety, leadership, digitaland competitiveness.
Delivering Safety
Airbus Helicopters’ chief priority is to enhance flight safety
for the thousands of men and women around the world who
are transported in its aircraft every day. This commitment isreflected across all company activities involving the lifecycleof a helicopter, with focus on meeting and exceeding industry
safety standards and supporting the safe operation of its aircraft.
Following a H225 Super Puma helicopter accident on 29 April
2016 in Norway, a final AIBN report was published and closed
the investigations. The accident was the result of a fatigue
fracture in a second stage planet gear in the epicyclic moduleof the main rotor gearbox.
Neither aviation authorities nor industry had ever seen thetype of failure mode that lead to this accident.
Extensive analysis of the accident has led to the developmentof a set of safety measures, approved by global aviation
authorities, which have allowed the H225 fleet to resume
worldwide.

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Subsequently, Airbus Helicopters has reviewed and applied
new safety measures to its product range. Furthermore, designchanges have been introduced on the Super Puma and Dauphinfamily of helicopters.

1

Market Drivers
According to market forecasts produced by Airbus Helicopters,
around 22,000 civil helicopters and 14,000 military helicopters
are expected to be built globally over the next 20 years. This
forecast, particularly with respect to the military sector, relies to alarge extent on large US development programmes. Overall, theglobal helicopter market is still evolving in a difficult environment,
despite improved economic indicators in 2018.
Helicopters sold in the civil and parapublic sector, where Airbus
Helicopters is a leader, provide transport for private owners andcorporate executives, offshore oil operations, diverse commercial
applications and state agencies, including coast guard, police,
medical and fire-fighting services. Thanks to its existing mission
segment diversity, the helicopter market (both Platforms andServices activities) is expected to be resilient through the coming
decade, even though one of the key segments, Oil & Gas (invalue), continues to experience challenging conditions. Airbus
Helicopters expects market softness to continue in the shortterm but believes that the demand over the next 20 years
will be driven by large replacement needs from advanced
economies and by growth from emerging countries (especiallyin Asia still largely under equipped). Airbus Helicopters’ market
data indicates that in 2018, worldwide deliveries of civil andparapublic turbine helicopters of five seats and above stood at~510 units. Demand for military helicopters and related services
is mainly driven by budgetary and strategic considerations, andthe need to replace ageing fleets. Airbus Helicopters believes
that the advanced age of current fleets, the emergence of a newgeneration of helicopters equipped with integrated systems andthe ongoing introduction of combat helicopters into many nationalarmed forces will contribute to increased military helicopter
procurement in the medium term. Nevertheless, demand fromthe military sector has historically been subject to large yearto-year variations due to evolving strategic considerations, andmay be limited, due to budgetary constraints on public spending
in some regions like Western Europe and Middle East, whileother regions like Asia Pacific or Eastern Europe are expected
to continue to grow. Despite recent threats and a growing
geopolitical instability, which has accelerated military spending
and a reassessment of defence budgets, the military market
is still low in 2018. Economic difficulties (i.e. low commodities
prices), saturation of the Western countries markets as well as
postponement of significant military campaigns have resulted
in a decrease for all mission segments. According to Airbus
Helicopters’ market data, worldwide deliveries of military turbine
helicopters have decreased at ~620 units in 2018.
Competition
Airbus Helicopters’ primary competitors in the civil andparapublic sector are Leonardo and Bell Helicopter. Sikorsky
and Russian Helicopters (except in Russia) continue to reflectvery low order intake in the C&P market while concentrating
their activity on the military sector.
The civil and parapublic sector has seen more local competitors
in recent years (China, India, Japan, South Korea, Turkey). Airbus
Helicopters has maintained its leading market share (in bookings

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Information on the Company’s Activities /1.1 Presentation of the Company

of 2.0t helicopters and five seats and above), in a low market,
with ~52% in unit in 2018, followed by Leonardo and Bell withrespectively 26% and 13%.
Airbus Helicopters’ main competitors in the military sector are
Sikorsky, Boeing and Russian Helicopters, thanks to large
captive market and strong political support for export.
The military sector is highly competitive and is characterisedby major restrictions on foreign manufacturers’ access to thedomestic defence bidding process (i.e. USA, China, Russia).
Thanks to several major contracts (i.e. H145M/Lakota andNH90), Airbus Helicopters increased its market share on this
sector (in units) from 9% in 2017 to 25% in 2018. The Company
will continue to focus on large military campaigns in 2019.

Customers
More than 3,000 operators currently fly Airbus Helicopters’rotorcraft in over 150 countries. Airbus Helicopters’ principal
military clients are Ministries of Defence (“MoDs”) in Europe,Asia, the US and Latin America. In the civil and parapublic
sector, Airbus Helicopters has a leading market share in Europe,
the Americas and Asia-Pacific.
With 54% of the worldwide market share-based on deliveries in
2018, the versatility and reliability of Airbus Helicopters products
have made them the preferred choice of the most prominent
civil and parapublic customers (turbine helicopters of five seats
and above).

Products and Services
Airbus Helicopters offers a complete range of helicopters that covers nearly the entire civil and military market spectrum, whichit continuously improves with leading-edge technologies. This product range includes single-engine, light twin-engine, medium
and medium-heavy helicopters, and is based on a series of new-generation platforms designed to be adaptable to both militaryand civil applications. In addition, products share multiple technical features as part of a family concept approach.
The following table sets forth Airbus Helicopters’ existing product line, consisting of optimised products for different mission types:
Helicopter TypePrimary Missions

Single Engine (“Ecureuil” family)
H125 “Ecureuil” / H125M “Fennec”
H130

Public Services(1), Military Utility(2) & Armed Reconnaissance, Corporate /Private, Commercial Pax Transport & Aerial Work
Commercial Pax Transport & Multipurpose, Emergency Medical, Tourism, Corporate / Private

Light Twin Engine
H135 / H135M

VIP, Military Utility & Armed Reconnaissance, Emergency Medical, Public Services(1)H145 / LUH (UH-72) / H145M

VIP, Military Utility(2), Emergency Medical, Public Services(1)Medium (“Dauphin” family)
AS365 “Dauphin” / AS565 “Panther”

Military Naval Warfare Mission & Maritime Security, Public Services(1)(in particular Coast Guard & SAR), Oil & Gas, Commercial Pax Transport & Multipurpose

H155

Corporate / Private, VIP, Oil & Gas, Public Services(1)H160

Corporate / Private, VIP, Oil & Gas, Public Services(1)H175

Corporate / Private, VIP, SAR, Emergency Medical, Public Services(1), Oil & Gas

Medium-Heavy
H215 “Super Puma” / H215M “Cougar”
H225 / H225M

Civil Utility, Military Transport / SAR, Oil & Gas
SAR, Combat-SAR, Military Transport, Oil & Gas, VIP, Public Services(1)NH90 (TTH / NFH)

SAR, Military Transport, Naval

AttackTiger

Combat, Armed Reconnaissance / Escort(1) Public Services includes homeland security, law enforcement, fire-fighting, border patrol, coast guard and public agency emergency medical services.
(2) Civil Utility includes different kinds of commercial activities such as aerial works, electrical new gathering (ENG), passenger and cargo transport.

Civil Range
Airbus Helicopters’ civil range includes single-engine, lighttwin-engine, medium and medium-heavy helicopters, which
are adaptable to all mission types based on customer needs. To
maintain and strengthen its competitive edge in the civil sector,
Airbus Helicopters is maintaining R&D investments including:certification of the H160, which realised its first serial flight inDecember 2018;
improvement of the existing range in the field of performancesand safety in order to meet customer’s requirements;

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Airbus / Registration Document 2018

the future H generation with major upgrades and--preparing
new products pursuing a fast-paced product range renewal.
Military Range
Airbus Helicopters’ military range comprises platforms derived
from its commercial range (such as the H145M and H225M
respectively derived from the H145 and H225) as well as purely
military platforms developed for armed forces (the NH90 and
the Tiger).

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Designed for modern multi-mission capabilities and costeffectiveness throughout its lifecycle, the NH90 has beendeveloped as a multi-role helicopter for both tactical transport(TTH) and naval (NFH) applications. The programme, mainly
financed by the governments of France, Germany, Italy and theNetherlands, has been jointly developed by Airbus Helicopters,
Leonardo of Italy and Fokker Services of the Netherlands
as joint partners in NATO Helicopter Industries (“NHI”) in
direct proportion to their countries’ expressed procurement
commitments. Airbus Helicopters’ share of NHI is 62.5%.
There were 36 NH90 deliveries in 2018, for a cumulative totalof 381 deliveries as of the end of 2018. The NH90 fleet has
accumulated ~187,000 flight hours.
The Tiger combat attack helicopter programme includes four
variants based on the same airframe: the HAP (turreted gun,rockets and air-to-air missile); the UHT (antitank missile, air-toair missile, axial gun and rockets); the ARH (antitank missile,turreted gun and rockets); and the HAD (antitank missile, airto-air missile, turreted gun, rockets and upgraded avionics
and engines) Overall in 2018, 9 Tigers were delivered, for a
cumulative total of 180 deliveries by year-end. The Tiger fleet
has accumulated more than 122,000 flight hours.

this large fleet generated 38% of Airbus Helicopters’ revenues
for 2018 (in 2017 it would have been 37% without Vector)
Airbus Helicopters’ customer service activities consist
primarily of maintenance, repairs, spare parts supply, training
and technical support. In order to provide efficient worldwide
service, Airbus Helicopters has established an international
network of subsidiaries, authorised distributors and service
centres.

Production
Airbus Helicopters’ industrial activities in Europe are conductedin four primary locations, two in France, one in Germany andone in Spain. The French sites are in Marignane, southern
France and Paris-Le Bourget. The German site is located in
Donauwörth, and the Spanish site is located in Albacete.
In the US, Airbus Helicopters, Inc. has two industrial sites: Grand
Prairie, Texas and Columbus, Mississippi. Grand Prairie serves
as the company’s headquarters and main facility and also serves
as the Airbus Helicopters Training facility for North America. The
Columbus facility is dedicated to the assembly and delivery of
the UH-72A Lakota and H125.

Airbus is also a major contractor to the US Army, having beenchosen to supply the service’s UH-72A Lakota helicopter. As
of 1 January 2019, 442 aircraft had been delivered to the US
Department of Defense for operation by US Army and Army
National Guard units, the Navy and foreign military sales buyers.

In Australia, Australian Aerospace upgrades and maintains
NH90 and Tiger for the country’s armed forces; while a rotarywing centre of excellence in Helibras — Itajuba, Brazil produces,assembles and maintains H225M helicopters acquired by theBrazilian armed forces.

Customer Services

Part of the transformation and its competitiveness branch is to
optimise its production footprint, especially in term of production
by creating some centers of excellence and avoid duplicationof work.

With more than 3,000 operators in over 150 countries, Airbus
Helicopters has a large fleet of some 12,000 in-service rotorcraftto support. As a result, customer service activities to support

1

1.1.4 Defence and Space
Airbus Defence and Space develops and engineers cuttingedge products, systems and services in the field of defence
and space, enabling governments, institutions and commercial
customers to protect people and resources while staying
connected to the world.
Airbus Defence and Space is organised in four ProgrammeLines: Military Aircraft; Space Systems; Communications,Intelligence & Security; and Unmanned Aerial Systems, which
are focusing on the following key activities respectively:
Military Aircraft designs, develops, delivers and supports
military aircraft. It is the leading fixed-wing military aircraft
centre in Europe, and one of the market leaders for combat,
mission, transport and tanker aircraft worldwide. Key products
include the Eurofighter Typhoon, the A400M, the A330 Multi
Role Tanker Transport (“MRTT”) and the C295;
Space Systems covers a broad range of civil and military space
applications. Its satellite solutions for telecommunications,
earth observation, navigation and science include spacecraft,
ground segments and payloads for institutional customers aswell as the export market, for the latter as recognised world----

leader. It also manufactures orbital and space exploration
systems. Space transportation capabilities (comprisinglaunchers and services) are offered via ArianeGroup, a 50/50
joint venture between Airbus and Safran;Communications, Intelligence & Security (“CIS”) includes fivemain business clusters: Secure Communications, Intelligence,
Cyber Security, Security Solutions and Secure Land
Communications. These clusters develop specific solutions forcustomers ranging from governments to small companies andcommercial enterprises. In addition, CIS houses a dedicatedunit for developing future applications for commercial markets,leveraging Airbus Defence and Space innovations, products
and capabilities;
Unmanned Aerial Systems (“UAS”) develops, delivers andoperates UAS and UAV solutions for airborne intelligence,
surveillance, reconnaissance, and combat missions. The
commercial part of the UAS Programme Line, Airbus Aerial,delivers actionable data for different vertical markets,connectivity and cargo delivery services – fitting customer
needs.

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Strategy
The ambition of Airbus Defence and Space is to become theworld’s leading provider of smart aerospace and defence
solutions. Following a comprehensive strategy review andupdate in 2016 and adaptation to evolving market dynamics,
Airbus Defence and Space is currently implementing a growthstrategy based on strengthening its core product portfolio
and expanding its services business, with a major emphasison digitalisation (“Smarter Products – More Services – More
Digital”).
Airbus Defence and Space is applying its growth strategy along
three domains:
Defence: Airbus Defence and Space is leveraging momentumin Franco-German cooperation and pursuing new European
programme opportunities as it works to deliver its vision for
Future Air Power. Key opportunities include Future Combat
Air System, European Medium-Altitude Long-Endurance(“MALE”), Maritime Airborne Warfare System, special mission
aircraft, and space situational awareness initiatives, among
others. The Division is concurrently working to shape andaddress future secure, upgradeable, and dynamic network
and Command and Control architecture requirements while
continuing to evolve existing platforms and capabilities (e.g.,
Eurofighter Typhoon, A330 MRTT, A400M, C-295, predictive
aircraft maintenance) for long-term competitiveness and value
to future force structures;
Space: Airbus Defence and Space will retain its leadership
position in space within Europe and in the export market
and growing above market rate by leveraging competitivity
programmes across all sectors (equipment, satellite, vehicle
and infrastructure domains, etc.). In parallel, it is developing
end-to-end solutions and accelerating new products andservices to strengthen its position across the space value chain.
Last but not least, it is working with European Governments
and institutions to ensure long-term competitiveness of theentire European space industrial base;
Digital Ser vices and Secure Connectivity: Digitaltransformation and digital platforms will be a key enabler tounlocking greater value from our portfolio while providing new
data-driven services and business models. The division will
provide imagery intelligence, aircraft in-service support, andother services while also striving to be a leader in end-to-end
secure connectivity across satellite, terrestrial, maritime, andairborne network and communication domains.

--

--

--

Globally, the Division intends to leverage its existing products
and services, innovate new offerings, and strike selectedstrategic partnerships in order to strengthen its position in the
US and other international markets.

MarketAirbus Defence and Space is mainly active in public andpara-public markets. As a general trend, defence budgets
in Europe are expected to continue to grow, triggered bygeopolitical tensions, heightened security risks and reinforced
by recent discussions on NATO defence spending target of
2% of GDP. In addition, the implementation of the European
Defence Action Plan of November 2016 was bolstered by thejoint declaration published in July 2017 by the French andGerman governments outlining the intention to strengthen
European defence, then by the agreement in 2018 to develop
jointly the Future Combat Air System (“FCAS”), the European

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Airbus / Registration Document 2018

MALE drone and the Future Maritime Airborne Warfare
Systems. Together, these may provide new sales opportunities
through members’ collaborative procurement mechanisms.
Market access outside the home countries may be subject
to restrictions or preconditions such as national content or
local industrial participation. Nevertheless, Airbus Defence
and Space, in conjunction with Airbus, is well-placed to benefit
from growth in defence expenditure. The upward outlook for
defence spending may continue to drive M&A activity in theindustry as has been the case since 2017. The market may
be influenced in the short-term by a potential softening of the
global economy and Brexit.
Military Aircraft
Customers
The Military Aircraft Programme Line with its products combat
aircraft, military transport aircraft, mission aircraft and related
services supplies the public sector, mainly armed forces.
Customer relationships in this segment are characterised by theirlong-term, strategic nature and long decision-making cycles.
Once a contract is signed, its life span including considerable
services business often amounts to decades. Beyond a strong
foothold in home countries, the customer base is increasingly
global, in particular due to the success of the A330 MRTT and
C295 programmes.
The turbulence created by changes in the US administration andthe Russian situation is gradually leading to a shift in importanceof defence in Europe. The commitment to go towards 2% of
the GDP is being gradually pursued and should lead to new
optimism for the sector. The Franco-German declaration insummer 2017 and the establishment of “Permanent Structured
Cooperation (PESCO)” by the European Union on 11 December
2017 are also clear signals in this direction.
Competitors
The market for military aircraft is dominated by large- andmedium-sized American and European companies capableof complex system integration. Among the competitive factors
are affordability, technical and management capability, theability to develop and implement complex, integrated systemarchitectures and the ability to provide solutions to customers.
In particular special mission aircraft, such as heavy tankers, arederived from existing aircraft platforms. Adapting them requires
thorough knowledge of the basic airframe, which generally only
the aircraft manufacturer possesses. The skills necessary forthe overall systems integration into the aircraft are extensive andthe number of participants in the world market is very limited.
The main competitors in military transport and mission aircraft
include Boeing, Embraer, Lockheed Martin, Leonardo, UAC,
Kawasaki, AVIC and Antonov.
Heavy military transport has historically been driven by US policy
and budget decisions and has therefore been dominated by
US manufacturers and split in strategic and tactical aircraft
segments. The A400M represents the Company’s entry into thismarket, at a time when nations are expected to begin replacing
their existing fleets. The aircraft is designed to disrupt thedivide between strategic and tactical transport by offering both
capabilities in one. This saves both time and cost as you can fly
a long range strategic aircraft into a tactical zone of operation.

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In terms of revenues, Airbus Defence and Space is the largest
continental European combat aircraft manufacturer. The
major combat aircraft activities are taking place through thecontribution to the Eurofighter Typhoon programme jointly withthe consortium partner companies BAE Systems and Leonardo.
Competitors in the segment of combat aircraft include Boeing,
Dassault, Lockheed Martin, Saab and UAC.
Market Trends
The sale of aircraft is expected to remain stable in the transportand special mission aircraft segments and could grow for theheavy transport segment, where the A400M occupies a uniqueposition.
After-sales services are an important business for Military
Aircraft and are undergoing strong growth in line with thedeliveries of A400M and A330 MRTT on top of the existing
robust revenue stream associated with Eurofighter Typhoon
in-service support.
The agreement signed between France and Germany inApril 2018 to jointly develop and procure the FCAS and the
Future Maritime Airborne Warfare System will also contributeto safeguarding critically-needed European defence capabilities
in the future.
Space Systems
Public Sector: Satellites, Space Infrastructure, Launchers,
Deterrence
In the public market for earth observation, science / explorationand navigation satellites, competition in Europe is organised
on a national and multinational level, primarily through theEuropean Space Agency (ESA), the European Commission(EC) and national space agencies. Space Systems, through its
Programme Unit Earth Observation, Navigation and Science, isa major actor in these respective segments and the recognised
European leader on ESA science programmes.
Decisions at the latest ESA Ministerial Conferences andunder EC Horizon 2020 paved the way for future European
programmes in which Airbus Defence and Space does or may
seek to participate. There is also important export demand forearth observation systems, of which the Company is the world’s
leading provider. The export market is expected to continue
growing over the medium-term driven by the demand comingfrom new governmental operators on top of the replacementof existing assets.
On the military customer side, demand for telecommunicationand observation satellites has increased in recent years.
The equipment segment can rely on a stable European market,
with potential growth to come from developing space countries
as well as the US.
The orbital infrastructure segment comprises manned andunmanned space systems mainly used for space exploration,i.e. scientific missions. Demand for orbital infrastructure
systems originates solely from publicly funded space agencies,
in particular from ESA, NASA, Roscosmos (Russia) and JAXA
(Japan). Such systems are typically built in cooperation withinternational partners. Continuing support to the operations of
the International Space Station (ISS), together with vehicle andequipment development programmes and services such as
the Service Module for NASA’s Orion spacecraft, constitutes

the predominant field of activity in this segment, and Airbus
Defence and Space leads the European contribution on
industrial level as prime contractor. As the future explorationplans of the various national space agencies take shape witha growing focus on a sustainable return to the Moon, Airbus
Defence and Space is well-positioned to take a leading rolein providing vehicles, platforms and services to support theseambitious endeavours.

1

The joint venture ArianeGroup is prime contractor for the
Ariane 5 launcher system. ArianeGroup is contracted for thedevelopment of the future Ariane 6 launcher and is the prime
contractor responsible for the development, manufacturing andmaintenance of the French deterrence systems.
Commercial Sector: Telecommunications Satellites, Launch
Services
The commercial telecommunication satellite market is highly
competitive, with customer decisions primarily based on price,technical expertise and track record. The main competitors fortelecommunications satellites are Boeing, Lockheed Martin,
MAXAR and Northrop Grumman in the US, Thales Alenia Spacein France and Italy, Information Satellite Systems Reshetnev
in Russia, and CASC in China. The market for commercial
geostationary telecommunications satellites has experienced
a down turn since 2017 and is expected to gradually recoverin the mid-term. In parallel, the demand for large constellationsof smaller telecom satellites in Low Earth Orbit has increased
dramatically in the last few years.
The market for commercial launch services continues to evolve.
Competitive pressure is increasing in light of new entrants
into the market. ArianeGroup provides a complete range oflaunch services with the Ariane, Soyuz, and Vega launchers.
Competitors for launch services include SpaceX, ULA, ILS andCGWIC. The accessible market to Arianespace for commercial
launch services for geostationary satellites is expected to remain
stable at around 20 payloads per year. However, due to various
factors (such as technology advances, increasing competitionand consolidation of customers), the figure remains volatile. This
market does not include institutional launch services for the
US, Russian or Chinese military and governmental agencies.
In 2015, Airbus Defence and Space announced the creationof OneWeb Satellites JV, an equally owned company with
OneWeb that designs and builds satellites for the OneWeb
constellation programme. The satellite constellation aims toprovide competitive global internet access. This participationis entrepreneurial in nature and is meant to drive innovation in a
new space market – an area that is set to expand dramatically incoming years. In 2017, OneWeb Satellites JV broke ground on theworld’s first state of the art high-volume satellite manufacturing
facility in Exploration Park, Florida, and inaugurated its serial
production line for the assembly, integration, and test of
OneWeb’s first satellites in Toulouse. In 2018, design of thepilot satellites was completed. The launch of the first satellites
in 2019 will allow validation of the design.
Communications, Intelligence & Security
The CIS Programme Line brings together the growing, but
increasingly competitive market for satellite and terrestrial
communication, intelligence and security services andsolutions. CIS serves a common customer base which
includes governments, defence institutions, security and public

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Information on the Company’s Activities /1.1 Presentation of the Company

safety agencies, and increasingly commercial sectors suchas transportation (maritime, aviation, road), energy (oil, gas,
electricity), mining and agriculture.
This programme line is divided into five main clusters: Intelligence,
Secure Communications, Cyber Security, Security Solutions
and Secure Land Communications.

Unmanned Aerial Systems
Customers

Through Intelligence, Airbus Defence and Space develops
Command and Control solutions for ministries of defence.
Competitors in this area largely come from European or American
based defence companies. Intelligence is also amongst thelargest players in the satellite imagery (optical and radar) market.
This sector remains mainly government orientated. However, thedemand for satellite imagery is growing in commercial markets
as many companies see geospatial data as key information for
their business development.

Unmanned Aerial Systems could lead to diversification into
services-driven markets. It is also a sector in which Europe has
a strong need for investment, which could set the stage for newcooperation programmes. France, Germany, Italy and Spain havesignaled their intention to cooperate on a medium altitude, long
endurance UAS and Airbus Defence and Space and its partners
finalised the two-year definition study of the system end of 2018.

Through its Secure Communications cluster, Airbus Defence andSpace is also a leader in governmental satellite communications.
This cluster offers a full portfolio of mobile and fixed satellite
communication and terrestrial secure communications solutions
for application at sea, on land and in the air. Customers areministries of defence, ministries of interior and NGOs.

With regards to platforms, Chinese, Israeli and US firms arewell established in the UAS market segment, along with other
European companies such as BAE Systems, Leonardo andThales, who are competing for new European projects. The
market itself features strong growth with significant opportunities
in Europe, the US and Asia Pacific.

Airbus Defence and Space is also a leading provider of cybersecurity products and services, including consultancy services in
Europe. The market growth is driven by an exponential increasein cyber-attacks, the increased use of connected assets andglobal digital transformation. Customers are governments andprivate companies with a high grade security requirement.
Combining our heritage in the defence domain and expertisein maritime safety and security systems, Security Solutions
answers manifold operational needs in security and criticalinfrastructure protection by providing adaptable solutions
and services needed to achieve everyday missions. As aworld-leading system integrator for border security, maritime
surveillance, critical national infrastructure protection and site
security services, Security Solutions’ aim is to build on theseassets in operation, thereby fulfilling the requirements of the
security market today and in the future with the latest technology
and most attractive service packages.
Secure Land Communications offers communication andcollaboration solutions with the highest standards of security
and reliability. These include voice, messaging and multimedia
sharing solutions based on Tetra, Tetrapol and 4G / 5G
technologies tailored to the needs of professionals from
Public Safety and Transport, Utility and Industry (TUI). As theEuropean leader and a key international player, Secure Land
Communications has customers in more than 80 countries.
In addition to the business clusters, CIS also houses Future
Applications, which is a business accelerator taking existing
capabilities from anywhere within the Division to new markets
not traditionally served. The goal is to form stable and sustainable
new business bringing profitable revenue to Airbus Defence andSpace on a scale significant to the Division within five years.
CIS focuses on public customers such as armed forces forgovernment satellite communications - an area characterised
by long-term relationships with customers. Whereas budget
pressures on public expenditure are high in Europe, investment
into the services and solutions offered by CIS is likely to continue
in the face of new global security threats, a re-emphasis on
defence and security and the growth in demand for digital

42

services. CIS has the objective to develop and scale digital
services, e.g. new services based on data generated by existing
Airbus Defence and Space products, to generate significant
revenues.

Airbus / Registration Document 2018

Competitors

Market Trends
UAS have a very promising growth potential. Market structuresin this segment are not clearly set out yet and will see somemovement, including a new European collaborative programme.
Services verticals will offer increasingly interesting prospects
as the market evolves.

Products and Services
Military Aircraft
A400M — Heavy military transport. The A400M is designed
to be the most capable new generation airlifter on the market
today. It is designed to meet the needs of the world’s armed
forces and other potential operators for military, humanitarianand peacekeeping missions in the 21st century. The A400M
is designed to do the job of three different types of militarytransport and tanker aircraft conceived for different types of
missions: Tactical (short to medium range airlifter capability withshort, soft and austere field operating performance), strategictransport (longer range missions for outsized loads) as well astactical tanker.
A total of 174 aircraft have been ordered so far by the seven launchcustomer nations Belgium, France, Germany, Luxembourg,
Spain, Turkey, the UK and one export customer, Malaysia. Type
Certificate and Initial Operating Clearance have been achieved in
2013. Since then, 75 units have been delivered to six nations asof 31 March 2019. The A400M is already deployed operationallysince 2014 and military capability is expected to grow over time.
Multi-role tanker transport — A330 MRTT. The A330 MRTT,a derivative of the Airbus A330 family, offers military strategic
air transport as well as air-to-air refueling capabilities. Its large
tank capacity is sufficient to supply the required fuel quantities
without the need for any auxiliary tanks. This allows the entire
cargo bay to be available for freight, with the possibility ofincorporating standard LD3 or LD6 containers, military pallets
and/or any other type of load device in use today, as well as thefull cabin available for personnel transport. The A330 MRTT is
equipped with state of the art refueling systems, including an

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Aerial Refueling Boom System (ARBS) and under-wing refuelingpods. At the end of 2018, the A330 MRTT programme has
a total of 60 aircraft firm orders by eight customers (twelve
countries (seven through direct acquisition, five through poolingacquisition in the frame of the MMF (Multinational MRTT Fleet)programme)), of which 35 already delivered and in service inseven nations.
Eurofighter Typhoon combat aircraft. The Eurofighter
Typhoon multi-role combat aircraft (also referred to as Typhoon)
has been designed to enhance fleet efficiency through a single
flying weapon system capable of fulfilling both air-to-air andair-to-ground missions.
The Eurofighter Jagdflugzeug GmbH shareholders are Airbus
Defence and Space (46% share), BAE Systems (33% share)
and Leonardo (21% share). With regard to series production,
the respective production work shares of the participating
partners within the Eurofighter Typhoon consortium stand at
43% for Airbus Defence and Space, 37.5% for BAE Systems and19.5% for Leonardo. Airbus Defence and Space develops andmanufactures the center fuselage and the right wing and leadingedge slats for all aircraft, and is in charge of final assemblyof aircraft ordered by the German and Spanish air forces. In
addition, Airbus Defence and Space is responsible for thedevelopment of the flight control system and the identificationand communication sub-systems.
At the end of 2018, a total of 623 Eurofighter Typhoon aircraft
had been ordered by nine customers (UK, Germany, Italy,
Spain, Austria, Saudi Arabia, Oman, Kuwait, and Qatar), witha total of 557 aircraft delivered. Export opportunities are being
actively developed together with the other shareholders of theEurofighter consortium.
C295 — Light and Medium military transport/mission
aircraft. The C295 is the work horse of tactical military transport,
conducting logistical missions including the transport anddelivery of personnel and cargo as well as medical evacuations.
The aircraft are deployed in demanding environments(meteorological conditions, operational complexity, etc.), suchas peacekeeping on the Sinai Peninsula. The aircraft are offeredin varied versions and configurations beyond the traditional
airlifter version, for example maritime patrol and anti-submarine
warfare, airborne early warning and control, firefighting andintelligence surveillance reconnaissance (ISR), etc. In over
30 years in service, this family of aircraft has proven to be robust,reliable, high-performing, efficient, flexible, easy to operate inany environment, and at low operating costs. 492 orders had
been recorded for both CN235 and C295 types together atthe end of 2018.
Customer Services. Airbus Defence and Space offers andprovides various services for and related to military aircraft.
Throughout the life-time of our aircraft, Military Aircraft Services
includes integrated logistics support, in-service support,
maintenance, upgrades, training or flight hour service. For
example, the A330 MRTT contract with the UK Ministry of
Defence through the AirTanker consortium includes alongside
14 aircraft the provision for all necessary infrastructure, training,
maintenance, flight management, fleet management and groundservices to enable the Royal Air Force to fly air-to-air refuelingand transport missions worldwide. Customer services go
beyond the fleet of aircraft currently in production at Airbus
Defence and Space, conducting upgrade programmes foraircraft such as the Tornado and P-3 Orion. Airbus Defence
and Space maintains a network of Maintenance, Repair andOverhaul centers strategically located throughout the world
for greater proximity to the customer, for example in Seville or
Manching in Europe, in Mobile, Alabama (US) or at subsidiaries
in Saudi Arabia or Oman.

1

Space Systems
Manned Space Flight. Airbus Defence and Space has been
the prime contractor for the European part of the International
Space Station (ISS). This includes the development andintegration of Columbus, the pressurised laboratory module
on ISS with an independent life-support system successfully inorbit since 2007. It provides a full-scale research environment
under microgravity conditions (material science, medicine,human physiology, biology, Earth observation, fluid physics
and astronomy) and serves as a test-bed for new technologies.
In 2015, ESA awarded Airbus Defence and Space a contract tohandle the engineering support of the European componentsof the ISS, which represents a key part of the ISS operational
activities. Airbus Defence and Space was also the prime
contractor for the development and construction of theAutomated Transfer Vehicle (ATV) cargo carrier. The expertise
gained on the ATV positioned Airbus Defence and Space tobecome the prime contractor for the European service moduleof NASA’s next generation Orion manned capsule.
Launch services. Airbus Defence and Space is active in thefield of launch services through its ArianeGroup joint venture.
ArianeGroup is responsible for the coordination and programmemanagement of civil activities of the launcher business andrelevant participations that have been transferred. ArianeGroupowns a total 74% stake in Arianespace, 46% of Starsem and
51% of Eurockot, providing a complete range of launch services
with the Ariane, Soyuz, Vega and Rockot launchers.
Commercial launchers. ArianeGroup manufactures
launchers and performs research and development for the
Ariane programmes. Member States, through ESA, fundthe development cost for Ariane launchers and associatedtechnology. Airbus Defence and Space has been the soleprime contractor for the Ariane 5 system since 2004. In
December 2014, the Ariane 6 programme was decided
by ESA ministerial conference with an approval of the joint
Airbus Defence and Space and Safran concept. In addition,a new industrial set-up was announced with the creation of
ArianeGroup between the two main Ariane manufacturers.
This vertical integration secures the future by cutting costs andbeing more competitive. Ariane 6 is targeted to be launchedin 2020.
Telecommunication satellites. Airbus Defence and Space
produces telecommunication satellites used for both civil andmilitary applications, such as television and radio broadcasting,fixed and mobile communication services and Internet broadband
access. Current Airbus Defence and Space geostationary
telecommunication satellites are based on the Eurostar familyof platform, including all-electric variant. In 2018, Airbus Defence
and Space was selected by Eutelsat to build the HotBird newgeneration satellites, two sophisticated telecom satellites
based on Eurostar Neo platform, the new flagship product for
Airbus Telecom Geo Satellites. Airbus Defence and Space also

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Information on the Company’s Activities /1.1 Presentation of the Company

develops the Eutelsat Quantum telecommunication satellite,
the first satellite that can be fully reconfigured in orbit throughits flexible antennae and repeater. Through its contract with
OneWeb to design and produce small telecommunication
satellites for a constellation in Low Earth Orbit, Airbus Defence
and Space is spearheading the industrial and commercial
development of very large satellite constellations.
Observation and scientific / exploration satellites. Airbus
Defence and Space supplies Earth observation satellite systems
including ground infrastructures for both civil and military
applications. Customers can derive significant benefits fromthe common elements of Airbus Defence and Space’s civil
and military observation solutions, which allow the collectionof information for various applications, such as cartography,
weather forecasting, climate monitoring, agricultural and forestry
management, mineral, energy and water resource management,
as well as military reconnaissance and surveillance.
Airbus Defence and Space also produces scientific satellites andspace infrastructure, which are tailor-made products adapted
to the specific requirements of the mostly high-end mission
assigned to them. Applications include astronomical observationof radiation sources within the Universe, planetary explorationand Earth sciences. Airbus Defence and Space designs andmanufactures a wide range of highly versatile platforms, opticaland radar instruments and equipment. For example, Airbus
Defence and Space contributed to the scientific community
with the launches of the Sentinel-1B radar, Sentinel-2A and LISA
pathfinder. It also signed a major contract to develop and build
the JUICE spacecraft, ESA’s next life-tracker inside the Solar
System. JUICE will study Jupiter and its icy moons.
Navigation satellites. Airbus Defence and Space plays a majorindustrial role in the “Galileo” European navigation satellite
system, which delivers signals enabling users to determine
their geographic position with high accuracy and is expected to
become increasingly significant in many sectors of commercial
activity. Airbus Defence and Space was responsible for the
Galileo in-orbit validation phase (IOV) to test the new satellite
navigation system under real mission conditions. The IOVphase covered the construction of the first four satellites of theconstellation and part of the ground infrastructure for Galileo.
After the successful launch of the first four Airbus Defence
and Space Galileo IOV satellites in 2011 and 2012, this early
constellation was successfully tested in orbit and handed overto the customer in 2013. Airbus Defence and Space is playing
an active role in the Galileo full operation capability phase(FOC) with a nearly 50% work share, including the FOC groundcontrol segment and providing the payloads for the first 22 FOC
satellites through its subsidiary SSTL.
Satellite products. Airbus Defence and Space offers anextensive portfolio of embedded subsystems and equipment
for all types of space applications: telecommunications, Earthobservation, navigation, scientific and space exploration
missions, manned spaceflight and launchers.
French deterrence systems. ArianeGroup as prime contractor
holds the contracts with the French State for the submarinelaunched deterrence system family.

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Communications, Intelligence & Security
Intelligence. Airbus Defence and Space is a provider ofcommercial satellite imagery, C4ISR systems and related
services with unrivalled expertise in satellite imagery acquisition,
data processing, fusion, dissemination and intelligenceextraction allied to significant command and control capabilities.
The cluster is a designer and supplier of C4I systems (Command,
Control, Communications, Computers and Intelligence), which
provides information systems and solutions to armed forces
worldwide to support land, air and sea operations, assuring
information superiority and supporting decision making at alllevels of the command chain.
Airbus Defence and Space’s lead systems integration offering
includes the ability to design, develop and integrate the widest
possible range of individual platforms and subsystems into asingle effective network.
Airbus Defence and Space is also a provider of both optical andradar-based geo-information services to customers includinginternational corporations, governments and authorities aroundthe world.
With the very-high-resolution twin satellites Pleiades 1A and 1B,
SPOT 6 and SPOT 7, Airbus Defence and Space’s optical satellite
constellation offers customers a high level of detail across wide
areas, a highly reactive image programming service and uniquesurveillance and monitoring capabilities. Spot 6 and 7 provide
a wide picture over an area with its 60-km swath, Pleiades 1A
and 1B offer, for the same zone, products with a narrower fieldof view but with an increased level of detail (50 cm).
Airbus Defence and Space is currently producing four Pléiades
Neo, Airbus’ new very high resolution satellites. They will join
the already large Airbus constellation of optical and radar
satellites and will offer enhanced performances and the highest
reactivity in the market thanks to direct access to the data relay
communication system, known as SpaceDataHighway.
TerraSAR-X, a radar-based Earth observation satellite thatprovides high-quality topographic information, enabled Airbus
Defence and Space to significantly expand its capabilities by
proposing new kinds of images based on radar. TanDEM-X,
its almost identical twin, was successfully launched in 2010
and achieved in 2014 WorldDEM, the first high precision 3-D
elevation model of the entire surface of the Earth.
Secure Communications. Airbus Defence and Space offersa full portfolio of mobile and fixed satellite communication andsecure terrestrial communications solutions for application
at sea, on land and in the air. Airbus Defence and Space
provides armed forces and governments in the UK, Germany,
France and Abu Dhabi with secure satellite communications.
For example in the UK, Airbus Defence and Space delivers
in the frame of the “Skynet 5 programme” tailored end-toend in-theatre and back-to-base communication solutions forvoice, data and video services, ranging from a single voicechannel to a complete turnkey system incorporating terminals
and network management. This contract, pursuant to which
Airbus Defence and Space owns and operates the UK military
satellite communication infrastructure, allows the UK MoD toplace orders and to pay for services as required. The service
is fully operational since 2009 and will extend to 2022. In Abu
Dhabi, Airbus Defence and Space together with Thales Alenia
Space built a secure satellite communication system.

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Cyber Security. Airbus Defence and Space has establisheda cyber security business to meet the growing cyber security
needs of users of critical IT infrastructure, including governments
and global companies. Airbus Defence and Space provides
expertise and solutions to help such organisations to protect
themselves against, detect, analyse, prevent and respond to
cyber threats. As a leading provider of security operation centres,
incident response services, key management, cryptography
and high-security national solutions and consulting and training
services, Airbus Defence and Space has a long track record inproviding the most sensitive secure IT and data handling andtraining solutions to defence and security customers throughout
France, Germany, the UK and other NATO countries.
Security Solutions include sensor networks ranging from
infrared and video cameras through radars to airborne andspace surveillance systems, all connected to command andcontrol centres, mainly for border security systems. Apart fromIntelligence, Surveillance and Reconnaissance (ISR) systems forgathering, aggregation and evaluation of incident data, highly
reliable and encrypted digital data and voice networks areprovided. Sophisticated decision-making tools support security
forces to prioritise incidents, allocate required resources andcontrol events in real-time. Services for long-term sustainable
operation and life-cost optimisation such as simulation andtraining, maintenance, support to operation, local partnerships
are also proposed.
Secure Land Communications. Airbus Defence and Space
offers advanced communication and collaboration solutions
enabling its customers to gather process and deploy
intelligence. Its portfolio is tailored to the needs of professionals
from Public Safety and Transport, Utility and Industry (TUI).
It includes infrastructures, devices, applications and services
based on Tetra, Tetrapol and Broadband technologies. As theEuropean leader and a key international player, Secure Land
Communications has customers in more than 80 countries.
Unmanned Aerial Systems
In the field of UAS, Airbus Defence and Space is active at bothproduct and service level. Airbus Defence and Space is theleading UAS service provider for the German air forces meeting
their MALE Intelligence, Surveillance and Reconnaissanceneeds in the operational theatre. These interim solutions, basedon non-proprietary MALE systems, will be replaced by a newgeneration European MALE RPAS system where Airbus Defence
and Space is working with its European partners. Airbus Defence
and Space also provides mini-UAS to the French armed forces
and selected export customers and the KZO UAS to the German
armed forces. It is developing the solar-powered Zephyr for bothmilitary and civil applications such as relay stations for internet
provision to remote or sparsely populated regions.

Airbus Aerial brings together a variety of aerospace technologies– including drones and satellites – combines them in a software
infrastructure, and applies industry specific analytics to deliver
tailored solutions to help its customers efficiently run theirbusiness. The portfolio of services focuses primarily on three
applications – remote sensing, cargo drone services andconnectivity. The Airbus Aerial activities will span both drone
enabled digital services as well as the development of certifiable
drones. Its focus lies on commercial customers in agriculture,
insurance, infrastructure, utilities, state and local government.

1

Production
Airbus Defence and Space is headquartered in Munich. The
main engineering and production facilities of the Division arelocated in France (Paris region and southwest France), Germany(Bavaria, Baden-Württemberg and Bremen), Spain (Madrid
region and Andalusia) and the UK (southern England and Wales).
In addition, Airbus Defence and Space operates a global networkof engineering centres and offices in more than 80 countries.

MBDA
The Company’s missile business, in addition to the ArianeGroupjoint venture, derives from its 37.5% stake in MBDA (a joint
venture between the Company, BAE Systems and Leonardo).
MBDA offers missile systems capabilities that cover the whole
range of solutions for air dominance, ground-based air defence,maritime superiority and battlefield engagement. Beyond its
role in European markets, MBDA has an established presence
in export markets like Asia, the Gulf region and Latin America.
The broad product portfolio covers all six principal missile
system categories: air-to-air, air-to-surface, surface-to-air, antiship, anti-submarine and surface-to-surface. MBDA’s productrange also includes a portfolio of airborne countermeasures
such as missile warning and decoy systems, airborne combat
training and counter-IED and counter-mine solutions. The mostsignificant programmes currently under development are theground based air defence system TLVS/MEADS for Germany,
the Aster Block 1 NT air and missile defence family of systems
for France and Italy, the Sea Venom/ANL anti-ship missile for the
UK and French navies’ helicopters, the portable medium range
battlefield “Missile Moyenne Portée (MMP)”, the network enabled
precision surface attack SPEAR missile and the “Common AntiAir Modular Missile (CAMM)”, which is an anti-air missile familywith land, naval and air launched applications.

ArianeGroup
Airbus Defence and Space is active in the field of launchers andlaunch services through its ArianeGroup joint venture, whichprior to July 2017 was named Airbus Safran Launchers (ASL).

1.1.5 Investments
Dassault Aviation
As a result of the implementation of Dassault Aviation’s
capital increase, which took place on 27 June 2018, at theoccasion of which 36,782 shares were issued to remunerate
the shareholders who opted for a dividend payment throughattribution of shares, the Company holds approximately 9.89%

of Dassault Aviation’s share capital and 6.15% of its voting rights.
In case of exchange in full of the bonds issued by the Company
and which are due in 2021, the Company will no longer holdany of Dassault Aviation shares and voting rights.

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Information on the Company’s Activities /1.1 Presentation of the Company

1.1.6 Insurance
The Company’s Insurance Risk Management function (“IRM”)
is established to proactively and efficiently respond to risks thatcan be treated by insurance techniques. IRM is responsible forall corporate insurance activities and related protection for theCompany and is empowered to deal directly with the insurance
and re-insurance markets via the Company’s inhouse broker
entity Airbus Aéroassurances. IRM’s continuous task in 2018
was to further implement and improve efficient and appropriate
corporate and project-related insurance solutions.
IRM’s mission includes the definition and implementation of
the Company’s strategy for insurance risk management to help
ensure that harmonised insurance policies and standards arein place for all insurable risks worldwide for the Company.
A systematic review, monitoring and reporting procedure
applicable to all Divisions is in place to assess the exposure andprotection systems applicable to all the Company’s sites. The
Company’s insurance programmes cover high risk exposuresrelated to its assets and liabilities.

Asset and liability insurance policies underwritten by IRM for
the Company cover risks such as property damage, businessinterruption, cyber, aviation and non-aviation general andproduct liability. IRM also provides a Group insurance policy for
Supervisory and Managing Board members and certain other
employees of the Company, which is renewed on an annual
basis. The Company follows a policy of seeking to transfer the
insurable risk of the Company to external insurance markets at
reasonable rates, on customised and sufficient terms and limits
as provided by the international insurance markets.
The insurance industry remains unpredictable. There may be
future demands to change scope of coverage, premiums anddeductible amounts. Thus, no assurance can be given that theCompany will be able to maintain its current levels of coverage
nor that the insurance coverages in place are adequate to cover
all significant risk exposure of the Company.

1.1.7 Legal and Arbitration Proceedings
The Company is involved from time to time in various legal andarbitration proceedings in the ordinary course of its business,the most significant of which are described below. Other thanas described below, the Company is not aware of any material
governmental, legal or arbitration proceedings (including any
such proceedings which are pending or threatened), during
a period covering at least the previous twelve months which
may have, or have had in the recent past significant effects on
the Company’s or Airbus SE’s financial position or profitability.
Regarding the Company’s provisions policy, the Company
recognises provisions for litigation and claims when (i) it
has a present obligation from legal actions, governmental
investigations, proceedings and other claims resulting frompast events that are pending or may be instituted or asserted in
the future against the Company, (ii) it is probable that an outflow
of resources embodying economic benefits will be required tosettle such obligation and (iii) a reliable estimate of the amountof such obligation can be made. Although the Company believes
that adequate provisions have been made to cover current orcontemplated general and specific litigation and regulatory
risks, no assurance can be provided that such provisions will
be sufficient. For the amount of provisions for litigation andclaims, please refer to the “— Notes to the IFRS Consolidated
Financial Statements — Note 22: Provisions, Contingent Assets
and Contingent Liabilities”.

WTO
Although the Company is not a party, the Company is supporting
the European Commission in litigation before the WTO. Following
its unilateral withdrawal from the 1992 EU-US Agreement
on Trade in Large Civil Aircraft, the US lodged a request on
6 October 2004 to initiate proceedings before the WTO. On

46

Airbus / Registration Document 2018the same day, the EU launched a parallel WTO case against
the US in relation to its subsidies to Boeing. On 19 December
2014, the European Union requested WTO consultations on theextension until the end of 2040 of subsidies originally grantedby the State of Washington to Boeing and other US aerospace
firms until 2024.
On 1 June 2011, the WTO adopted the Appellate Body’s final
report in the case brought by the US assessing funding toAirbus from European Governments. On 1 December 2011, theEU informed the WTO that it had taken appropriate steps tobring its measures fully into conformity with its WTO obligations,and to comply with the WTO’s recommendations and rulings.
Because the US did not agree, the matter was referred to the
WTO for further review pursuant to WTO rules. A decision
was published in May 2018 in which the WTO clarified that the
EU and the Company have achieved compliance in respectof the majority of the subsidies at issue but considered thatsome remaining obligations required minor adjustments, whichhave since been addressed by the EU. Because the US did
not agree on the EU compliance efforts, the US requested
the resumption of Article 22.6 arbitration proceedings toquantify the amount of countermeasures against the EU. In
September 2018, the US requested an annual amount ofcountermeasures of US$ 11.2 billion. The Company considers
the US’ request unjustified given the measures taken to comply
with the Appellate Body decision of May 2018. The Company
has worked with the European Commission and the Member
State governments to fully implement the WTO findings in theAppellate Body’s decision and asserts that the new measurestaken render the sanctions request moot. On 9 April 2019,
the United States Trade Representative (USTR) published for
public consultation a preliminary list of products from the EU
to which it may seek to apply duties pursuant to the May 2018

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decision, which includes new aircraft and helicopters as wellas major components for aircraft manufacturing in the US. The
actual amount of duties to which the US may be entitled will
be determined at the conclusion of the Article 22.6 arbitration
proceedings in accordance with the WTO rules.
The potential imposition of any import duties (and the amountthereof) or other countermeasures against the EU following the
Article 22.6 arbitration proceedings will depend on the USTR,
and could have a material impact on the financial statements,
business and operations of the Company. At this stage it is
too early to determine the extent of any financial impact on the
Company. Duties on the importation of Airbus products into
the US could result in (i) increased costs for the aerospace
and airline industries as well as other industries that rely on
air transport, (ii) weakening demand for new aircraft andnegatively affecting the financial condition of air carriers andlessors, (iii) decisions to defer, reject or reschedule the deliveryof new aircraft or limit the routes upon which new aircraft will
be used, (iv) increased costs to consumers, (v) retaliation by theEU with its own import duties to be applied to US products,
and/or (vi) damage to the Company’s business or reputation via
negative publicity adversely affecting the Company’s prospects
in the commercial market place.
On 23 March 2012, the WTO adopted the Appellate Body’s
final report in the case brought by the EU assessing funding
to Boeing from the US. On 23 September 2012, the US
informed the WTO that it had taken appropriate steps to bringits measures fully into conformity with its WTO obligations,and to comply with the WTO’s recommendations and rulings.
Because the EU did not agree, the matter was referred to the
WTO for further review pursuant to WTO rules. The Appellate
Body published its decision in March 2019 in which the WTO
rejected the US’s arguments and preserved the EU’s win before
the panel. The Appellate Body also found that additional US
federal and state programmes constitute illegal subsidies. Now
that the Appellate Body report has been adopted, the EU haverequested resumption of an arbitration concerning the amountof annually-recurring countermeasures it is permitted to takeagainst the importation of US products. On 17 April 2019, the EU
published a public consultation on a preliminary list of products
from the US on which the EU may take countermeasures. The
actual amount of duties to which the EU may be entitled will
be determined at the conclusion of the Article 22.6 arbitration
proceedings. In the event that the US does indeed impose duties
on Airbus aircraft, the imposition of equivalent or greater tariffs
on aircraft imports into Europe is likely.
Exact timing of further steps in the WTO litigation process issubject to further rulings and to negotiations between the US
and the EU.

GPTIn August 2012, the UK Serious Fraud Office (“SFO”) announced
that it had opened a formal criminal investigation in relation to
GPT Special Project Management Ltd (“GPT”), a subsidiary
operating in Saudi Arabia that the Company acquired in2007. The investigation relates to issues initially raised by awhistleblower concerning contractual arrangements originating
prior to GPT’s acquisition and continuing thereafter. The
Company has engaged with the SFO throughout and continues
to actively cooperate with the investigation.

Eurofighter Austria
In February 2017, the Austrian Federal Ministry of Defence
raised criminal allegations against Airbus Defence and SpaceGmbH and Eurofighter Jagdflugzeug GmbH for wilful deception
and fraud in the context of the sale of the Eurofighter aircraft
to Austria and respective damage claims. After the AustrianFederal Ministry of Defence raised its criminal allegations, theAustrian public prosecutor opened an investigation against
Airbus Defence and Space GmbH, Eurofighter Jagdflugzeug
GmbH and former and current employees of the two entities.
The Company has filed several submissions to the Vienna Public
Prosecutor in response to the allegations of deception in the
procurement of Eurofighter combat aircraft made by the Austrian
Defence Minister. The Company is cooperating fully with theauthorities.

1

Investigation by the UK SFO and France’s PNF
and Related Commercial Litigation
In the context of review and enhancement of its internal
compliance improvement programme, the Company discovered
misstatements and omissions relating to information provided
in respect of third party consultants in certain applications
for export credit financing for the Company’s customers.
In early 2016, the Company informed the UK, German andFrench Export Credit Agencies (“ECAs”) of the irregularities it
had discovered. The Company made a similar disclosure to
the UK Serious Fraud Office (“SFO”). In August 2016, the SFO
informed the Company that it had opened an investigation into
allegations of fraud, bribery and corruption in the civil aviation
business of Airbus relating to irregularities concerning third
party consultants (business partners). In March 2017, France’s
Parquet National Financier (“PNF”) informed the Company thatit had also opened a preliminary investigation into the same
subject and that the two authorities would act in coordination
going forward. The Company is cooperating fully with both
authorities including in respect of potential issues across theCompany’s business. As part of the Company’s engagementwith the US authorities, the latter have requested information
relating to conduct forming part of the SFO/PNF investigationthat could fall within US jurisdiction. The Company is cooperatingwith the US authorities in close coordination with the SFO andPNF. The investigations and any penalties potentially levied as aresult could have negative consequences for the Company. The
potential imposition of any monetary penalty (and the amountthereof) or other sanction including tax liability arising fromthe investigations will depend on the ultimate factual and legalfindings of the investigation, and could have a material impact
on the financial statements, business and operations of theCompany. However, at this stage it is too early to determine
the likelihood or extent of any such possible consequence.
Investigations of this nature could also result in (i) civil claims
or claims by shareholders against the Company (ii) adverse
consequences on the Company’s ability to obtain or continue
financing for current or future projects (iii) limitations on theeligibility of group companies for certain public sector contracts
and/or (iv) damage to the Company’s business or reputation via
negative publicity adversely affecting the Company’s prospects
in the commercial market place.
In light of these investigations, the Company enhanced certainof its policies, procedures and practices, including ethics andcompliance and export control. The Company has revised
and implemented improved procedures, including those with

Airbus / Registration Document 201847

Information on the Company’s Activities /1.1 Presentation of the Company

respect to its engagement of consultants and other third
parties, in particular in respect of sales support activities. The
Company believes that these enhancements to its controls
and practices will best position it for the future, particularly
in light of advancements in regulatory standards. Several
consultants and other third parties have initiated commercial
litigation and arbitration against the Company seeking relief. The
enhancement of its controls and practices has led to additionalcommercial litigation and arbitration against the Company andmay lead to other civil law or criminal law consequences in
the future, which could have a material impact on the financial
statements, however at this stage it is too early to determine
the likelihood or extent of any liability.

ECA Financing
The Company and the ECAs reached agreement on a process
under which it is able to resume making applications for ECAbacked financing for its customers across the Company on acase-by-case basis for a limited number of transactions.

Other Investigations
The Company is cooperating fully with the authorities in a
judicial investigation in France related to Kazakhstan. In thisspirit, the Company asked to be interviewed by the investigating
magistrates and has been granted the status of “assisted
witness” in the investigation.

The Company is cooperating with French judicial authorities
pursuant to a request for mutual legal assistance made by thegovernment of Tunisia in connection with historical aircraft sales.
Following a review of its US regulatory compliance procedures,
the Company discovered and subsequently informed relevant
US authorities of its findings concerning certain inaccuracies
in filings made with the US Department of State pursuant toPart 130 of the US International Traffic in Arms Regulations(“ITAR”) (a US export control regulation). The Company iscooperating with the US authorities. The Company is unable
to reasonably estimate the time it may take to resolve thematter or the amount or range of potential loss, penalty or othergovernment action, if any, that may be incurred in connection
with this matter.

Other Disputes
In the course of a commercial dispute, the Company received
a statement of claim by the Republic of China (Taiwan) alleging
liability for refunding part of the purchase price of a large contract
for the supply of missiles by subsidiary Matra Défense S.A.S.,
which the customer claims it was not obliged to pay. An arbitralaward was rendered on 12 January 2018 with a principal amountof € 104 million plus interest and costs against Matra Défense
S.A.S. Post-award proceedings are currently underway.

1.1.8 Non-Financial Information
1.1.8.1

The Company’s Approach to
Responsibility & Sustainability

The Company and its Main Stakeholders
Airbus is an industrial company operating in businesses with longproduct lifecycles and corresponding returns on investment.
There are significant costs and risks in programme development
and cyclical markets. These features define the Company andshape its relationships with all stakeholders. For a descriptionof the Company’s business model, see “— 1.1.1 Overview”.
The Company is engaged in stakeholder dialogue at various
levels. The responsibility for stakeholder engagement isdecentralised at the Company and employees are encouraged toinitiate, develop and maintain relationships with their respective
stakeholders. The Company often seeks a sectorial approachin order to strengthen the impact.
The Company’s main purpose, its missions and the objectives
resulting from them, are defined in relation to these stakeholders.
The Company has defined the following objectives:
generate long-term value by developing a sustainably
profitable portfolio of aeronautics, helicopter, defence andspace businesses. For its shareholders, lenders and otherfinancial counterparts, the Company must meet its obligations
and foster its standing of creditworthiness and profitability;
be a provider of choice, offering superior value-for-money
products and services to customers;
engage employees to share its goals and rise to its challenges.
Within the confines of applicable laws and regulations,

----

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Airbus / Registration Document 2018

the Company must respond to their expectations aboutdevelopment, people management and values;
build sustainable relationships with its suppliers basedon mutual interest to satisfy its customers to encourage
responsible practices. The Company promotes the Supplier
Code of Conduct as standards consistent with its own codeof conduct, and also develops and implements adequate
mechanisms to monitor supplier performance;
Play a key role in society and towards local communities. The
Company is committed to responsible business practices interms of respect for human rights, labour, the environment
and anti-corruption. In addition, the Company encourages
initiatives that contribute to tackling societal challenges
whether through its products and services, skills andresources or via key partnerships.

----

Materiality Assessment
In order to prioritise its responsible and sustainable efforts, theCompany performed a materiality assessment in 2017. The
Company approached a set of stakeholders through qualitativeinterviews. A list of top issues for the Company was developed,
consolidated and ranked by the Company’s Responsibility &Sustainability Network. The network gathers a group of experts
advising on Airbus’ Responsibility & Sustainability (“R&S”)
strategy, monitoring progress in their respective areas of
responsibility, sharing knowledge and best practices throughout
the entire Company. It is trans-functional, trans-national andtrans-divisional and meets on a regular basis.

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You will find these issues covered within the following sectionsof this chapter:
Responsible Manufacturer: 1.1.8.2(a) Aviation and Product
Safety (“product responsibility” in the matrix), 1.1.8.2(b)Research and Technology (“technology and innovation”
in the matrix), 1.1.8.2(c) Environment (“environmentally
responsible products” and “environmental management ofoperations” in the matrix), 1.1.8.2(d) Responsible Defence
and Space products (“security” and “product responsibility”
in the matrix);--

Employer: 1.1.8.3(a) Workforce and 1.1.8.3(b)--Responsible
Human Capital Management, Labour Relations and Human

Rights (“responsible employer” in the matrix), 1.1.8.3(c) Healthand Safety (same in the matrix), 1.1.8.3(d) Inclusion andDiversity (“business culture and leadership” in the matrix);
Responsible Business: 1.1.8.4(a) Ethical business practices(“business culture and leadership” in the matrix), 1.1.8.4(b)Responsible Suppliers (“responsible supply chains” in thematrix), 1.1.8.4(c) Community Engagement (“community
impact” in the matrix).

1--

CRITICALHIGHEST

Responsible
employerTechnology& innovation
Product
responsibility

Business culture& leadership
Environmentally
responsible products

Health & Safety

Environmental
management of operations

HIGHERHIGH

INCREASING CONCERN TO STAKEHOLDERS

MATERIALITY MATRIX 2017

Responsible
supply chains

Stakeholder
engagement

Community
impactEconomic

Security

HIGH

HIGHERHIGHEST

CRITICAL

INCREASING CONCERN / IMPACT ON AIRBUS
Environment

SocialEconomy & Governance

UN Sustainable Development Goals

Airbus Responsibility & Sustainability Charter

Airbus has been a signatory to the UN Global Compact since2003 and has reached “Advanced Level”.

In 2017, the Company has outlined its commitments in its
Responsibility & Sustainability Charter (“the Charter”). The
Charter demonstrates how Airbus intends to contribute to
the requirements and needs of society and how employees
will live the Company’s six values – respect, customer focus,
reliability, creativity, integrity, team work – in their daily workwith all stakeholders whether customers, suppliers, partners,
shareholders. The Charter is available at www.airbus.com.
In 2018, the Charter was the subject of a series of internal
communication activities.

The Company adopted the UN Sustainable Development
Goals (SDGs) in December 2015 as a framework to align its
responsible and sustainable contributions. Over 2016, theCompany performed a mapping of its contributions basedon its publicly available information which demonstrated thatat least eight of the 17 SDG goals are directly relevant to theCompany’s businesses and stakeholders’ feedback confirmedthat the Company is actively contributing to:SDG 4: Quality education;
SDG 5: Gender equality;
SDG 8: Decent work and economic growth;
SDG 9: Industry, innovation and infrastructure;
SDG 12: Responsible consumption and production;
SDG 13: Climate action;
SDG 16: Peace, justice and strong institutions; andSDG 17: Partnerships for the goals.

---------In 2017, Airbus started to put in place an internal mapping of
its contributions to the commitments it made in the Charterand the corresponding SDGs. Airbus has worked on mapping
internally and identifying targets or KPIs to assess its overall
contributions. The objective is to reach common agreement
on one target per commitment contained within the Charter.

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Information on the Company’s Activities /1.1 Presentation of the Company

Airbus’ Way Forward: Vigilance Plan
The Company is determined to conduct its business responsibly
and with integrity. The Company is convinced that promoting
responsible business conduct within our value chain is key tosustainable growth.
As far as its own operations are concerned, the Company has
adopted internal policies and management tools to performthe assessment, monitoring, mitigation, reporting of risk
and compliance allegations, which are fully embedded into
the Company’s culture and processes. At Airbus, heads ofprogrammes and functions, as well as managing directors
of affiliates, supported by respective specialists, shall ensure
proper deployment of the Company’s policies, managementof Enterprise Risk Management (“ERM”) in their fields or
perimeters as well as duly reporting issues to top management.
The Company’s approach is thus based on its existing strengths,
namely strong management process already established andadopted by employees; empowerment of specialists; industry
approach whenever possible.
In 2017, Airbus established a working group composedof specialists representing supplier management, healthand safety, environmental affairs, labour rights, ethics andcompliance, corporate governance as well as risk managers
and representatives from the Company’s two Divisions.
One of the tasks of the working group was to perform a risk
assessment and define concrete actions in order to ensure
continuous monitoring of the entire Company and to mitigate
principal risks or prevent serious violations. In 2018, the working
group focused on leveraging every opportunity to embed R&S
elements throughout the Company and including them into
internal processes and tools.
With regard to risk management, Airbus performed an in-depth
review of its ERM system in order to identify potential missing
risks related to human rights and fundamental freedoms, healthand safety and the environment in 2017. The ERM system was
updated to take into account the most significant potential
risks related to these areas that the Company may generateas part of its operations. These risks and related action plans
are now consolidated and reported to the top managementof the Company. For more information on ERM, see “- 4.1.3,
Enterprise Risk Management System”. For more information on
the Company’s risks, see “— Risk Factors”.
To support our commitment to and promotion of a speak-up
culture, Airbus created the OpenLine to provide the Company’s
employees with an avenue for raising concerns in a confidential
way. In 2018, the Company decided to extend the scope to
responsibility and sustainability related topics. For more
information on the OpenLine, see “– 1.1.8.4(a) Ethical Business
Practices”.
In addition to the current training catalogue of over 80 e-learning
courses on labour relations, diversity, environmental and healthand safety matters, as well as R&S and human rights, theCompany is working on specific learning programmes for target
groups. One programme targeting all the Company’s employees
worldwide will focus on increasing general awareness on R&S aswell as Airbus’ commitments as outlined in the Charter. A second
programme will be dedicated to risk-exposed populations, suchas directors of subsidiaries and buyers, aiming at developing
in-depth understanding of legal requirements with regards toenvironment, health & safety, human rights, labour relations,anti-corruption within the Company’s operations and supply

50

Airbus / Registration Document 2018

chain, and promoting the Company’s internal processes to help
mitigate potential risks and help prevent violations. The Airbus
Leadership University took the lead to embed R&S strategy
and commitments into the courses it offers in order to ensure
the Company’s managers are trained and equipped to instil
the right behaviours, foster cultural change and encourage thesearch for innovative solutions to answer societal challenges. In
addition, the Company also provides training to its employeeson the Airbus Standards of Business Conduct.
All Airbus affiliates (affiliates where Airbus owns more than one
half of the voting rights, or is able to appoint or discharge morethan one half of the members of the board) with operational
activities are expected to deploy similar internal policies
applying Airbus directives. A corporate directive assists
Airbus affiliates in effectively fulfilling their responsibilities while
assuring Airbus’ ongoing commitment to high standards ofcorporate governance. In 2018, Airbus, working closely with
its two Divisions, approved one single directive on corporate
governance for the Company’s affiliates, which defines rules,
processes and procedures applicable to Airbus affiliates andtheir respective boards, directors and officers. Airbus leveraged
this in-depth work to integrate enhanced requirements on
labour and human rights, environment, health and safety andprocurement matters into the new directive on the basis ofrelated Airbus internal policies including:International Framework Agreement;
Agreement on the European Works Council;
Supplier Code of Conduct;
Health & Safety Policy;
Standard of Business Conduct;
Environmental Policy; andAirbus Anti-corruption Policy and Directives.

--------In 2018, Airbus and its two Divisions each sent their respective
affiliates a questionnaire to assess their internal controls
including as they relate to the environment, human resources
and compliance. Regarding all the above activities, affiliates
were asked to confirm that all relevant Airbus policies wereaccessible to their employees and duly communicated to themand that dedicated training was organised for risk-exposed
employees. For 2019, the scope of the questionnaire will evolve
to cover topics included in the new Directive, including R&S, andharmonised between Airbus and the two Divisions.
In the course of 2019, affiliates will be asked to evaluate risks
via the Airbus ERM system as well as to regularly monitor themas part of their risk assessment process. Airbus endeavours toensure that the procedures to assess, investigate and manage
allegations are well aligned throughout the Company.
Each affiliate with operational activities has in place a Boardof Directors and/or a shareholders’ meeting where strategic
decisions are made. Each affiliate has an Airbus supervisor
who is a member or chairman of the board who ensuresthat all Airbus requirements are considered by the affiliate’s
management. At least once a year the agenda of the board will
include an update on ethics and compliance matters (including
training, awareness and any other relevant issues).
In order to ensure proper and systematic cascading of R&Srelated policies throughout the Company, Airbus’ head of
Affiliates has joined the R&S Network.
For its principal minority joint ventures, Airbus will ensure theproper application of its policies or those of its partner.

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A dedicated programme has been launched by the Procurement
function in order to monitor Airbus’ suppliers. For more
information on the programme and its implementation, including
the vigilance plan for suppliers, see section 1.1.8.4(b) Responsible
Suppliers. For more information on Airbus’ approach to theenvironment, see section 1.1.8.2(c). For more information on
Airbus’ approach to human rights and health and safety, seesections 1.1.8.3(b) and 1.1.8.3(c).

1.1.8.2

Responsible Manufacturer

a. Aviation and Product Safety
Airbus recognises the significant trust placed in its products by
their operators and passengers, and takes its responsibility for
their safety seriously. Whilst the foundations of safety are built
on regulatory compliance, Airbus goes beyond airworthiness
requirements to also focus on safety enhancement activities in
products, services, customer operation, and with international
stakeholders, whilst also adapting the organisation to meet
evolving conditions.
Whenever safety topics must be discussed, it is done at theappropriate level, including by Airbus’ senior executives.
The Product Safety Process (PSP) is Airbus’ primary meansof responding to what is happening with the 10,000 Airbus
aircraft flying today, and of maintaining continued airworthiness.
It enables Airbus to analyse reports from the field and other inservice events, and frequently leads to the introduction of safetyenhancements either to new products under development or
to existing designs.
Regulatory compliance
Product certifications are provided by the competent aviation
authorities including the main civil aviation authorities (EASA,
FAA, NAA) and specific military authorities (EMAR, NAA).
Specific approvals are granted by these authorities to therelevant parts of Airbus’ organisation at commercial aircraft
level and within each Division, according to their function.
Airbus therefore works to ensure compliance through:design and certification of products under EASA Part 21
Design Organisation Approvals (DOA), ECSS-QST-40-C for(Space Products) and Def-Stan 00-56 (Defence Products);
manufacturing under Production Organisation Approvals(POA);
monitoring of in-service safety through approved EASA
Part-M Continuing Airworthiness Management Organisations(CAMO);
aircraft maintenance and retrofit operations conducted in linewith civil and military EASA Part 145 regulations;training provided to flight crews, cabin crews and maintenancecrews through EASA Part 147 Approved Training Organisations(ATO).

------

The certified organisations of Airbus are audited by the aviation
authorities to ensure the surveillance of the full compliance ofAirbus to regulatory requirements. Additional audits are also
conducted by third parties as part the quality certifications
appropriate to each Division, including EN9100, EN9001,
EN9110, AQAP 2110, AQAP 2210 and AQAP 2310.

Going beyond compliance
For enhancing safety by managing and reducing safety risks, anumber of company-wide organisational initiatives ensure thatdepartments throughout Airbus work together to harmonise
the Company’s overall approach to aviation and product safety.

1

Airbus commercial aircraft and each Division includes a
dedicated Aviation and Product Safety function which provides
a voice for safety which is independent of other corporate
priorities, and empowered to take action across each businessto ensure the highest levels of product safety.
For the commercial aircraft activities of Airbus and in each
Division, a Safety Management System (SMS) is deployed
in order to ensure definition and clarity of safety policy andobjectives, manage safety risks, assure effectiveness of
implemented risk control strategies and promote safety culture
amongst the workforce.
Safety policy is set within the Divisions, following common
themes in behavioural values:
putting safety first with a commitment to recognising thatlives depend on safety;
being engaged with safety, and aware of the impact of ouractions on safety;
ensuring that potential safety topics are reported andapplicable lessons learnt shared with stakeholders.

----

One of the key elements of the Company’s safety culture is
the open sharing of technical information and lessons learnt
with operators and industry stakeholders, including during
major investigations within the constraints of ICAO Annex
13 practices. Safety culture is reinforced by the provision ofmeans for confidential reporting of safety topics across Airbus.
Just & Fair Culture policies and commitments, which provide
assurance and protection from penalisation to employees whoreport unintentional errors, are defined and deployed throughout
the Company.
The Company’s safety policies identify axes of safetyenhancement activity including in the safety of Airbus products,
the safety of flight operations of Airbus products, and safety ofthe environment in which products are operated. Enhancement
activities are tailored to take into account differences in thecustomer base and operating environment of Airbus commercial
aircraft and each Division.
b. Research and Technology
The Chief Technology Office (CTO) applies a lean, project-based
approach, encouraging collaboration with external researchcommunities and develop partnerships, especially through open
innovation with technical and scientific experts.
CTO is responsible for: guiding all R&T activities of theCompany and ensuring Airbus-wide integration of technology
through Technology Planning and Roadmapping, accelerating
the development of selected technologies through Flight
Demonstrators together with the Divisions, providing expertisein breakthrough technologies in support of the group wide
projects in Central R&T and developing technologies for the
next generation aircraft in Airbus R&T. Technology Planningand Roadmapping provides R&T Portfolio exhaustive view
across the Company, manages CTO portfolio planning process
and develops technology roadmaps including the use of key
Figures of Merit to enable a value based technology planning.

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Information on the Company’s Activities /1.1 Presentation of the Company

Flight Demonstrators provide a maturation mechanism andmaturity gates for the group R&T portfolio. The Demonstrators
employ a CTO-established development methodology,
including phasing and key gates, lightweight project
management and earned-value management processes,
including budgeting, HR and contracting mechanisms tailoredfor speed of execution.
Central R&T is an R&T planning and delivery vehicle identifying
and delivering technology through breakthrough research for
future product generations. Central R&T portfolio is shared with
Division R&T and is organised in five boost areas - data science,materials, communication technologies, electrics expertise andvirtual product engineering.
Ax R&T The Divisional R&T functions are primarily planning,decision making and arbitration teams accountable within
their perimeters to both CTO and to Divisional Engineeringand Product Strategy. Their responsibilities include securingcontinuous improvement in Divisional competitivenessand ability to develop business. Fast Track Domains serve
as principal advisors to the CTO on technical vision androadmaps for associated Technology Domain areas. Fast Tracks
established to ensure coherency in the portfolio of activities andto rapidly advance strategic priorities are:
Electrification;
Industrial Systems and Manufacturing;
Connectivity;
Autonomy;
Materials;
Artificial Intelligence.

-------Key Progress in 2018
Flight Demonstrators
Flight Demonstrators are a technology delivery vehicle fortechnological breakthroughs, providing a maturation mechanismand maturity gate for the R&T portfolio. The E-Fan family oftechnology demonstrators is a bold step towards all-electricand hybrid-electric flight aimed at establishing requirements
for future certification of electrically powered airplanes and attraining a new generation of designers and engineers for thechallenges of electric flying.
A3
A 3 (pronounced “A-cubed”), is the advanced projects andpartnerships outpost of the Company in Silicon Valley with themission to disrupt the aerospace industry.
Altiscope helps integrating unmanned aircraft systems (UAS)
into the airspace. Using a simulator to evaluate policy options
and operational models for air traffic management systems,
it aims to service all forms of airborne traffic.
Vahana is an electric urban air mobility vehicle designed tocarry a single passenger or cargo. The objective is to fly at fullscale an all-electric, self-piloted VTOL aircraft and discover
the core set of requirements and technologies to enableself-piloted operations. The first Vahana full-size prototype
successfully completed its first test flights in early 2018.
Adam (Advanced Digital Design and Manufacturing) aims todevelop methods and tools to drastically reduce development
lead-time and production cost by leveraging emerging digitaltechnologies.
Wayfinder develops a scalable and certifiable platform forAutonomy and Machine Learning to enable future autonomous
flight projects.

Sao Paulo, Brazil, and Mexico City.

The operational management of Vahana, Voom and Altitscopeis exercised by the new UAM organisation.
Airbus China Innovation Centre (ACIC)
ACIC, based in Shenzhen, is the first Innovation Centre set up
by Airbus in Asia. Its mission is to fully leverage local advantages
including innovative talents, partners and the eco-system, andcombine this with Airbus’ expertise in aerospace to explore
breakthroughs in technologies, business models and new
growth opportunities.
BizLab
Airbus BizLab is the aerospace accelerator where startups andthe Company’s intrapreneurs speed up the transformation of
innovative ideas into valuable businesses. BizLab offers earlystage selected projects wide-ranging support in the form of aprogramme with a six-month acceleration phase. Startups andinternal projects benefit from free hosting in BizLab facilities,
have access to a large number of the Company’s coaches andexperts in various domains, and participate in events such asa Demo Day with the Company’s decision makers, customers
and partners.
Airbus Helicopters
Safety remained the 2018 priority by significant progress oncomponents architecture and advanced usage and healthsystems development. Advanced algorithms to provide specific,
early and reliable damaging diagnostic on crack initiation weredeveloped to provide our H225 customers with maintenancecredit.

City Airbus, a three-to-four passenger optionally piloted electricvehicle demonstrator for unmanned air mobility, was a top priorityof 2018 to gain experience and expertise on urban mobility andvehicle requirements. It has transitioned into Airbus Helicoptersfrom the ExO and has successfully performed a power-on in
November 2018 to launch the flight campaign in January 2019.
The urban last mile delivery solution, Skyways, has demonstrated
a delivery solution in 2018 after a first flight in January.

--

Airbus Defence and SpaceA priority in 2018 was technology development supporting
unmanned aerial systems data driven services to accelerate
the business development in this area. Light weight sensors
and communication links deployed on the Zephyr High-Altitude
Pseudo Satellite were equally important than the automateddata analytics on images and other surveillance data which
in future will be more and more based on artificial intelligencealgorithms.

--

Integration and implementation of 3-D printing capabilities
across the Division’s flying products was accelerated throughgroup-wide initiatives and will continue to be qualified for flight(in military and commercial aircraft as well as in spacecraft /satellites).

--

--

52

delivers an on-demand urban air mobility service using--Voomhelicopters. It successfully completed its beta phase pilot in

Airbus / Registration Document 2018

Technologies ensuring ef ficient satellite constellation
management as well as preparing the next generation payload
modules were matured to Technology Readiness for ProductIntegration.

REGISTRATION DOCUMENT 2018
Information on the Company’s Activities /1.1 Presentation of the Company

Intellectual Property
One of the Company’s most valuable assets is its intellectual
property (IP). IP includes patents, designs, trademarks, copyrightworks, confidential information and other proprietary informationsuch as know-how. It is the Company’s policy to establish,
protect, maintain and defend its rights in all commerciallysignificant IP. The protection of IP is critical to the business of
the Company.

c. Environment
The industry faces a variety of environmental challenges,
including climate change, and Airbus invests and cooperates
with stakeholders across the value-chain in researching andimplementing innovative ways to meet them.
As aviation represents around 2% of global man-made CO 2
emissions, Airbus recognises its role in reducing the global
environmental footprint of the sector and the importance ofstaying in line with the global 2°C trajectory. Climate change
may also affect the environmental conditions in which Airbus’
manufacturing activities and products are operated. Anotherarea of attention is the elimination of substances that may posea risk to human health or the environment. Airbus is continuallyseeking technically-feasible sustainable solutions to reduce
the environmental impacts of its products and operations, incooperation with Airbus’ suppliers and industrial stakeholders.
The following section explains Airbus’ engagement in managing
these challenges.
1. Environmental Management at Airbus“Shaping the future” for Airbus means developing products
and services taking into consideration current and foreseeable
future environmental challenges for future generations and withlong-term value creation in mind. In 2018, Airbus updated its
environmental policy, with a strong engagement from the CEO.
The new policy focuses on three main directions:driving development of eco-efficient products and services
taking into account environmental challenges;
continually improving our manufacturing and site operations;working in cooperation with the aerospace sector to develop
sustainable operations of air transportation.

----

Airbus Environment Steering Committee coordinates on all
matters related to the environment. The Steering Committee
meets four times a year and is composed of the heads
of Environment for Helicopters, Defence and Space andthe commercial aircraft activities of Airbus, as well as arepresentative from the R&S department. The responsibilities ofthe members are to provide consistency in environmental policy
across divisions and businesses in a harmonised manner, whereappropriate and specific actions are agreed for operational
implementation.

Environmental risks and opportunities are managed following
the company’s ERM process. Risks and opportunities arereported quarterly to the Executive Committee of each divisionand top risks are consolidated at company level to be brought
to the attention of Airbus’ top management.

1

On an annual basis, Airbus undertakes an extensive exercise tocollect, consolidate and report the Company’s environmental
performance data. Quantitative data is gathered as well as
qualitative data (including certification, incidents and activities onsite). This enables Airbus to measure the environmental impact
of its site operations, track its performance and communicate
information on environmental matters to internal and external
stakeholders.
The reporting of environmental indicators is being extended toprogressively include relevant categories of Scope 3 emissions.
This provides a greater understanding of the environmental
impact of Airbus products and operations.
The emissions of the products in operation are largely influenced
by downstream stakeholders: airlines’ operations of aircraft,
air traffic management, and fuel development are amongst
them, reinforcing the need for development of appropriate
methodology at sectorial level.
In 2018, Airbus reporting includes C02 emissions on the
upstream value chain, with emissions linked to employee
business travel and oversized transportation. Airbus is looking
into developing methodology regarding the C02 emissions ofpurchased goods and services.
Working in Cooperation
Airbus understands the importance of working together withother stakeholders to find solutions.

Airbus is a Founding Member of International Aerospace
Environmental Group (IAEG) and participates in different areasof IAEG, such as greenhouse gas emissions, substancesmanagement, substitution technologies and supply chain toshare practises and promote development of global standards.
Airbus is an active board member of the Air Transport Action
Group (ATAG) which sets industry goals including CO2 emission
reduction goals, and mobilises action on strategic aviation
issues.
Aviation is a global industry and requires global solutions. ICAO,
a specialised agency of the UN, has a proven track recordof delivering robust aviation environmental standards andguidance (i.e. air quality, noise, CO2).

Airbus also monitors environmental regulatory developments
to understand, evaluate and prepare for legal and regulatory
evolutions applicable to its activities and products.

Airbus supported the ICAO agreement in 2016 on the CO 2
standard and also the adoption of the new Carbon Offsetting& Reduction Scheme for International Aviation (CORSIA) in
2017. Within the framework of this sectorial offsetting scheme,
airlines will start the monitoring and reporting process of CO 2
emissions on 1 January 2019. CORSIA is the first global sectorialoffsetting scheme.

Airbus has put in place robust Environmental Management
Systems (EMS) based on ISO 14001. Airbus was the first aircraft
manufacturer to be ISO 14001 certified. Amongst this year’sachievements was the successful certification of the production
site in Mobile, Alabama, which is now part of the certification
scope.

Airbus continues to proactively support emissions andnoise reductions once the aircraft goes into service with ourcustomers, through fuel efficiency services, weight saving
projects, developing and offering retrofits (i.e. sharklets) andground operation solutions (i.e. e-Taxi) and the Sustainable
Aviation Engagement Programme.

Airbus / Registration Document 201853

Information on the Company’s Activities /1.1 Presentation of the Company

Airbus has worked with the European Space Agency (ESA)in Earth observation for over 25 years. EarthCARE (Earthclouds, aerosols and radiation explorer) and Copernicus, themost ambitious Earth observation programme to date, are two
examples.

chromate-free alternatives to materials containing and processes
using chromates in aircraft production and maintenance.
Chromate-free external paint systems developed initially for the
A380 programme are now used in all Airbus commercial aircraft
manufacturing programmes and across the aerospace industry.

Recyclability is another important topic that Airbus is tacklingin cooperation with other entities. With TARMAC Aerosave, ajoint venture between Airbus SAS, Safran Aircraft Engines andSuez, more than 90% of an aircraft weight is today recycled or
re-used through a selective dismantling (reverse manufacturing)process. As airplanes manufactured with large volumes ofcomposites start retiring in the next few decades, Airbus isworking in cooperation with several specialist companies
involved in carbon fibre recycling, as part of an industry goal todetermine the best processes and uses for recycled and reusedcarbon fibre materials.

Another example is the Airbus Basic Primer project that
researches potential alternatives with the aim of phasing out
the green chromated primer coat.

2. Environmental Concerns
Regulated Substances across its Products’ Lifecycles
Many substances used in the global aerospace industry toachieve high levels of product quality, safety and reliability are
subject to strict regulatory requirements.

In the aerospace industry, regulations on substances impact
key processes and products, such as surface treatments, paints
and fire protection.
Facing this challenge, Airbus remains committed to movetowards replacement of such substances in products andprocesses. To help achieve this, the Company has put in placea portfolio of activities and projects, working with suppliers
to identify, develop, qualify and deploy new technologies andsolutions that avoid use of substances classified as posing
a risk to human health or the environment, whilst satisfying
airworthiness, certification and performance requirements.
Airbus also engages with suppliers to promote the adoption ofa similar approach through regular communication and, more
widely, by working together with the aerospace industry to
promote worldwide harmonisation of regulations and ways ofworking, taking into account the sector’s safety and lifecycle
specificities.
Using information obtained from its suppliers, Airbus tracks,
registers, assesses and declares regulated substances.
The Company has already qualified and deployed over 300
alternative products for substances such as ozone-depleting
substances and fluorinated gases.
Airbus invests substantial time and resources in researchand development for technologies that use alternatives toregulated substances. When it can be demonstrated that thesetechnologies meet the strict safety and reliability criteria required
for aviation, Airbus seeks to implement them in its aircraft design
and manufacturing.
For example, in 2006, the Airbus Chromate-Free project was
launched with the aim of developing, qualifying and deploying*

54

Baseline: 2015 and constant production.

Airbus / Registration Document 2018

Environmental Impact of Airbus Industrial Operations
Airbus is engaged in an industrial transformation to anticipate
and prepare itself for mid-term evolutions of its industrial systems
as well as the longer-term solutions to build its “factories of the
future”. This company-wide initiative will support the reductionof Airbus’ environmental footprint on air, soil and water quality,
climate change, biodiversity and resource availability. An
evaluation of lifecycle hotspots on some main Airbus products
is also ongoing to help focus on appropriate topics.

Analysis of the current trends shows that regulatory pressure
on the international scene to reduce the environmental footprintof the aerospace industry is steadily growing (circular economy
and resources efficiency, energy transition and climate change
engagement, air and water quality improvement).
Airbus has committed and continues to commit to setting up
ambitious short-, mid- and long-term environmental targets.
In 2006, the environmental vision was set up for 2020 withgoals (by reference to a baseline of 2006 at constant revenue)
for reduction of energy consumption, CO 2 emissions, water
consumption, VOC emissions, and waste production.
So far, the Company’s energy consumption (stationary sources)
has been cut by 38%, exceeding the goal of 30%; CO2 emissions
have decreased by 40% (scope 1 stationary sources + scope 2
total) against the goal of 50%; VOC emissions have been cut by
60% exceeding the goal of 50%; water consumption has been
reduced by 46% against a goal of 50%; and waste production
has been diminished by 42% against a goal of 50%.
Thus, since 2017, Airbus has set an extended 2030 Vision.
The following operational objectives on commercial aircraft
manufacturing activities have been set:
respect the Paris Agreement by keeping a global temperaturerise well below 2°C above pre-industrial levels, and absorb
production ramp-up impacts by reducing CO 2 emissions
intensity by 60%*;
reduce its water intensity by 50%*;
maintain levels in compliance with air emissions regulations
and absorb production ramp-up impacts; anddeploy environmental requirements for and evaluation of
suppliers and use these results in supplier selection processes.

-----

The two Divisions are in the process of developing similar
approaches.

REGISTRATION DOCUMENT 2018
Information on the Company’s Activities /1.1 Presentation of the Company

Airbus monitors and makes available data verified by external auditors, and publishes transparently its industrial performance.
Environmental data has been externally audited since 2010. Below is a selection of externally reviewed environmental indicators.
Environmental
performance

Energy

GRI

EN3

EN16
EN17
Air emissions
EN20
EN21

Water

KPI

Unit

2018

2017

Total energy consumption (excluded electricity generated
by CHP on site for own use) ✔

MWh3,962,484

4,098,475

Energy consumption from stationary sources ✔

MWh1,296,135

1,357,724

Energy consumption from mobile sources ✔

MWh1,098,179

1,206,689

Total electricity consumption ✔

MWh1,568,169

1,534,062

Generated electricity from CHP on-site for own use ✔

MWh190,287

190,127

Total Scope 1 + Scope 2 CO2 emissions ✔

tonnes CO2

965,633

1,013,101

Total direct CO2 emissions (Scope 1) ✔

tonnes CO2

553,063

591,002

Total indirect CO2 emissions (Scope 2) ✔

tonnes CO2

412,570422,099

Indirect CO2 emissions Business Travel (Scope 3)

tonnes CO2

111,666na

Indirect CO2 emissions Oversize Transportation* (Scope 3)

tonnes CO2

185,500

na

Total VOC emissions

tonnes

1,557

1,565

Total SOx emissions

tonnes17

15

Total NOx emissions

tonnes

321

314

EN8

Total water consumption ✔

m3

4,016,913

4,011,897

EN22

Total water discharge

m3

3,336,712

3,416,506

tonnes

98,592

105,839

Material recovery rate ✔

%

57,8

58,5

Energy recovery rate

%

20,7

20,6

Unit

60/71

61

%

89

90

Total waste production, excluding exceptional waste ✔
Waste

EMS certification

EN23

Number of sites with ISO 14001 / EMAS certification** vs total
number of covered by environmental reporting
Workforce effectively covered by reporting over workforce subject
to reporting according to the environmental guidelines.***1

A220 sites are not yet included according to reporting rules.
✔ Data audited by Ernst & Young et Associés. Limited assurance report is available on www.airbus.com. 2018 data covers 89% of total group employees.
* Oversize emissions cover transport of large and non standards shipments. 2018 values cover Aircraft commercial aircraft activities.
** Number of sites covered by the environmental reporting which are certified ISO 14001.
*** Airbus environmental reporting guidelines include sites worldwide with a workforce on-site higher or equal to 50 employees. Note that only 100% consolidated entities are taken
into account to calculate this 50 employee threshold. For electricity, coverage is slightly higher (90.3%) due to inclusion of AD Stevenage site.

Environmental IMPACT of Airbus Products in Operation
In the last 50 years, the aviation industry has cut fuel consumption
and CO2 emissions per seat / kilometre by more than 80%, NOxemissions by 90% and noise by 75% of aircraft in operation.

Whilst this performance is impressive, Airbus and the aviationindustry recognise the importance to continue improving thesector’s environmental performance in all areas – from noise
to air quality and GHG emissions, notably CO 2. Due to theindustry’s short- to medium-term reliance on fossil-based fuels
as well as potential additional impacts from non-CO2 factors,
the reduction of aviation’s impact on climate change remains
an environmental challenge.
To address the CO 2 challenge, Airbus, along with airlines,
airports, air traffic management and other manufacturers,
committed in 2008 to the ATAG CO2 emission goals:
improve fleet fuel efficiency by an average of 1.5% per annum
between 2009 and 2020;stabilise: from 2020, net carbon emissions from aviation will
be capped through carbon neutral growth (CNG); and---2050, net aviation carbon emissions will be half of what--bythey were in 2005.
Meeting these challenging goals will require a truly collaborative
approach across the industry, focused on a combination of
improvement measures encompassing technology (including
sustainable fuels), operational improvements, infrastructure(including air traffic management) and global market based
measures.
Good progress has already been made on the first two ATAG
CO2 emission targets:the average global fleet fuel efficiency has improved bymore than 2% per annum over the last 5 years. Airbus has
contributed significantly to this reduction by delivering new
aircraft (such as the A350 XWB, 25% more efficient than theprevious generation aircraft; the A320neo, offering today 15%
less fuel consumption compared to A320ceo (targeting 20%
in the near future); and the just recently delivered A330neo,
providing 14% improved fuel consumption efficiency);--

Airbus / Registration Document 201855

Information on the Company’s Activities /1.1 Presentation of the Company

recently agreed ICAO Carbon Offsetting & Reduction--theScheme for International Aviation (CORSIA) should also play
an important role towards achieving Carbon Neutral Growthfrom 2020.

Since 2008 Airbus has been actively supporting the developmentof sustainable aviation fuel, promoting its use with Airbus
customers and supporting its certification. After having started
offering the possibility to perform commercial aircraft delivery
flights with sustainable aviation fuel from its delivery centre in
Toulouse, Airbus has now enlarged the offer for sustainableaviation fuel delivery flights to its delivery centre in Mobile
since October 2018. Airbus’ ambition is to further scale-up
these activities and to make available significant quantities ofsustainable fuels for its commercial aircraft customers’ delivery
flights on a regular basis – and in the longer term from all Airbus
commercial aircraft delivery centres around the world.
For the ambitious long-term 2050 target, the Company continues
its research in step-change technologies that further improve thesustainability of our products. Electrification and hybridisation
can bring not only significant benefits in addressing CO2 but
also for noise and NOx emissions reductions. The Company istherefore investing in research efforts on developing electric andhybrid-electric propulsion technologies. The Company alreadystarted its journey towards electric flight with the E-Fan family of
aircraft in 2011, a success that permitted the Company to learn
from the hundreds of flights performed since. In November 2017,
the Company launched E-Fan X in cooperation with Siemens andRolls-Royce. E-Fan X is an ambitious technology demonstrator
project that aims to be a stepping stone toward a hybrid electriccommercial aircraft at the scale of today’s single aisle family.
Alongside reducing CO2 emissions, Airbus’ latest aircraft models
also offer improvements in both noise and NO x emissions
reduction: A350 XWB with up to 21 EPNdB lower noise and 31%
lower NOx emission compared to CAEP/6 industry standards,
A320neo with up to 20 EPNdB lower noise compared to ICAO
chapter 4 and 60% lower NOx emission compared to CAEP/6
industry standards. Moreover, A330neo is the first aircraft toreceive ICAO chapter 14 noise certification, with a margin of 6
EPNdB and up to 13 EPNdB compared to chapter 4 as well as
27% lower NOx. The H160 helicopter brings noise levels downby 50% compared previous generation helicopters.
Airbus works with stakeholders across the industry including
engine manufacturers, airlines, air traffic management providers
and airports to be part of the solution in reducing commercial
aircraft noise impacts through optimised operational techniques
and preferential routings, as well as quieter aircraft. Extensive
efforts to reduce noise at the source are already applied in thedesign process. High priority is being placed on finding new
innovative solutions and technology improvements such as lownoise nacelle designs.
With the establishment of an ecodesign team in 2018, Airbus
Defence and Space has broadened the environmental analyses
carried out on its products, including conducting life cycle
assessments on various space products. The aim is to advancethe environmental performance of its products. Engineers arebeing provided with such information to reduce the use ofregulated substances in product development and to increase
resource efficiency.

56

Airbus / Registration Document 2018

Services for Products in Operation
The Company is supporting the CO 2 roadmap not only
through state-of-the-art technologies improving environmental
performance of aircraft, but also through services such as
NAVBLUE, a 100% Airbus company. NAVBLUE develops digitalflight operations and air traffic management solutions which offer
improved navigation, enhanced operational efficiency and fuelsavings (i.e. SkyBreathe software).

d. Responsible Defence and Space Products
The Company’s products provide invaluable insights on global
environmental challenges and natural disasters, contribute to asafer space environment, and are being deployed to meet world
governments’ ever-changing needs to protect citizen’s rights.
Defence & Security
The Company works with the EU, NATO and other governments
to supply the necessary equipment to support their efforts tomake the world a safer place. Nations need defence systems
and equipment to guarantee sovereignty, security and humanrights. The Company’s military aircraft, satellites and security
technologies help protect democratic values around the globe.
A partnership with the Company also helps them to protect
their nations from the changing nature of terrorism threats andcybercrime.
Unique product features include:

is an innovative unmanned airship that performs--ALTAIR
emission free, multi-hour visibility over cities and crowds ofpeople, enabling police forces to secure critical events;

Finder delivers fast satellite-based detection and--Oceanidentification reports for assets at sea, including ships,

locating hijacked boats, illegal activities detection, maritime
mission preparation as well as supporting search and rescue
operations;
Spationav is the coastal surveillance project of Airbus DS SAS;
Deutsche Küste - As part of the security concept Deutsche
Küste (German Coast Security Concept), Airbus Security
Solutions is providing a maritime information system is used
for managing the planning and coordination of vessel trafficand safety of shipping within German territorial waters.

---

For information on risks related to security, see “Risk Factors– Business-Related Risks – Physical Security, Terrorism,
Pandemics and Other Catastraphic Events” and “Cyber Security
Risks”.
Environmental Contributions
With its low earth orbit meteorology satellite systems, opticaland radar imagery from Airbus satellites shed light on significant
environmental issues such as climate change, pollution,
deforestation and natural disasters. Programme highlights
include:Copernicus is the European Union’s Earth Observation
programme. The satellites built and managed by the Company
as part of the EU’s programme include Sentinel 2 circles
the Earth’s landmasses every 10 days, delivering data for
agriculture, forestry, natural disaster control and humanitarianrelief efforts. ADM-Aeolus provides global observations ofatmospheric modelling and analysis techniques, which benefit
operational weather forecasting and climate research;--REGISTRATION DOCUMENT 2018
Information on the Company’s Activities /1.1 Presentation of the Company

mission provides meteorological observations from--METOP
polar orbit and contributes to the long-term climate monitoring

programme. It also has a search and rescue function;
BIOMASS will provide global scale maps of biomass, changes
due to forest loss (from logging/burning) and forest regrowth,
improving the understanding of the contribution of forests to
the global carbon budget;
Twin Grace-FO Satellite observes changes in the Earth’s
gravitational field over time to better understand the dynamic
processes beneath the Earth’s surface and the changes in theice coverage at the poles;
Starling is a service that assists companies in verifying
commitments made to stop deforestation;
Zephyr is the world’s leading solar-powered High Altitude
Pseudo-Satellite (HAPS), providing persistent surveillance,
tracing the world’s changing environmental landscape, and will
be able to provide communications to the most unconnectedparts of the world.

--

Sustainable Space
The Company is working to ensure a safe and sustainable spaceenvironment for current and future generations by pioneering
relevant technologies and participating in leading sector
initiatives. Examples include:
RemoveDEBRIS, a collaborative space debris removal
technology mission;
Technology for Self-Removal of Spacecraft (TeSeR), is a
consortium which aims to reduce the risk of spacecraft
colliding with debris through a module that prevents collisionrisk;
O-Cubed is an on-orbit servicing solution for active debris
removal, satellite maintenance and in-space manufacturing.

--

---

---

--

The Airbus Foundation’s partners, such as non-governmentalorganisations, benefit from Airbus satellite images to assist themin carrying out relief efforts following natural disaster events, aswell as the use of Airbus platforms in the transport of relief aide.
Further details on the Airbus Foundation are provided later inthis chapter.

1.1.8.3

Responsible Employer

a. Workforce
As of 31 March 2019, the Company’s workforce amounted
to 135,468 employees (compared to 133,671 employees asof 31 December 2018, 95.78% of which consisted of full-time
employees). These statistics take into account consolidation
effects and perimeter changes throughout 2018. Depending
on country and hierarchy level, the average working time isbetween 35 and 40 hours per week.
2018

2017

2016

Newcomers

10,959

7,318

7,532

Core division

5,246

3,900

3,843

Subsidiaries

5,713

3,418

3,689

Entries & Leaves

Leavers (including partial retirement)

6,198

5,151

4,698

Core division

3,245

2,646

2,274

Subsidiaries

2,953

2,505

2,424

In terms of nationalities, 36.3% of the Company’s employees
are from France, 31.5% from Germany, 9.0% from the UK and
9.9% from Spain. US nationals account for 1.8% of employees.
The remaining 11.6% are employees coming from a total of
136 other countries. In total, 90.7% of the Company’s active
workforce is located in Europe on more than 100 sites.

Furthermore, the Company expects its workforce to evolve
naturally to support the business.
Workforce by Business Segment and Geographic Area
The tables below provide a breakdown of the Company’s
employees by business segment and geographic area, as well
as by age, including the percentage of part-time employees.
31 December 201831 December 201731 December 2016

80,92474,54273,852

Airbus Helicopters ✔

19,745

20,161

22,507

Airbus Defence and Space ✔

33,002

32,171

34,397

0

2,568

3,026

133,671

129,442

133,782

Employees by Business Segment
Airbus* ✔

Airbus (former HQ) ✔

Group Total ✔

1* Airbus includes population of former HQ since 1 January 2018.
✔ Data audited by Ernst & Young et Associés. Limited assurance report is available on www.airbus.com.

Airbus / Registration Document 201857

Information on the Company’s Activities /1.1 Presentation of the Company

31 December 201831 December 201731 December 2016

France ✔

48,14447,86547,963Germany ✔

45,38744,21446,713

Spain ✔

13,684

13,177

12,682

UK ✔

11,214

11,304

12,020

US ✔

2,489

2,707

2,829

Employees by geographic area

Other countries ✔

12,753

10,175

11,575

Group Total ✔

133,671

129,442

133,782

31 December 201831 December 201731 December 2016

4.22%

4.20%

4.13%

31 December 201831 December 201731 December 2016

130,131

126,534

131,153

3,540

2,908

2,629

% Part time employees
Group Total ✔

Active Workforce by contract type
Unlimited contract ✔
Limited contract > 3 months ✔

The Company´s attrition rate is 4.9% overall (incl. subsidiaries)
and 8.51% in subsidiaries only.

b. H uman Capital Management, Labour Relationsand Human Rights

T h e C o m p a ny’s h e a d c o u nt re p o r ti n g i n c l u d e s a l lconsolidated companies worldwide. The internationallycomparative figures are based on the active workforce,i.e. the number of permanent and short-term employees,
irrespective of their individual working times. The headcountis calculated according to the consolidation quota of therespective companies. The scope for HR structure reporting
covers about 97% of the Company’s total active workforce
from consolidated companies. In total, about 3% of theCompany’s employees are not included in the scope, as
no detailed employee data is available at group level forsome companies belonging to the Company, usually recently
acquired.

The Company’s workforce is managed by the HR function
thanks to a set of HR policies and a strong labour structure.
HR policies are discussed and agreed with social partners
through continuous and regular meeting at global and local
levels. The current priorities of the Company’s HR function are:to ensure that the Company can attract, develop and retain
a world-class competent, motivated and flexible workforce,
which fits current and future business requirements;
to facilitate diversit y, continuous integration andinternationalisation of the Company and contribute to acommon culture based on strong company values;
to be a global employer of choice and an innovative, inclusive
and engaging place to work for all employees.

----

Training and Mobility
In 2018*, the Company provided more than 1,3 million training
hours and more than 11,000 employees participated to learning
linked to leadership domain.
2018*

2017

Number of Classroom Training ✔

114,327

134,427

Number of Digital Training ✔

248,448

144,624* Change of reporting period in 2018: from 1 Oct. 2017 to 30 Sep. 2018

In addition, in 2018 more than 30,000 employees benefitted fromothers developments and transformation solutions proposed by
the Airbus Leadership University. The purpose of the university
is to strengthen the Company’s approach to leadership, offering
equivalent opportunities for all leaders to drive their development
one step ahead, while accelerating the culture evolution andhuman transformation in the Company.
Mobility of employees within or across Airbus and its Divisions is
one of the main priorities for the overall benefit of the Company.

58

Airbus / Registration Document 2018

In 2018, as of end of December, more than 12,500 employeeschanged jobs cross-divisionally and cross-country.
Labour Relations
Wherever it operates, the Company wishes to grow its economic
success in consideration of common principles and standards
consistent with International Labour Organisation (ILO)
conventions, the OECD Guidelines for Multinational Enterprises
and the principles laid down by the UN Global Compact, which
the Company has adopted. The principles are in complianceREGISTRATION DOCUMENT 2018
Information on the Company’s Activities /1.1 Presentation of the Company

with the Airbus Standards of Business Conduct and with theInternational Framework Agreement signed in 2005.
In the International Framework Agreement, the Company
reaffirms its willingness to respect the regulation regarding
fundamental human rights, equal opportunities, free choice of
employment, as well as prohibition of child labour and respectand ensuring the conditions for industrial dialogue.
The Company in particular intends, via its agreements, torespect the disposition of the following ILO conventions:
numbers 111 (discrimination – employee and occupation), 100(equal remuneration), 135 (workers’ representatives), 29 (forced
labour), 105 (abolition of forced labour), 182 (child labour), 138(minimum age), 87 (freedom of association and protection of
the right to organise) and 98 (right to organise and collective
bargaining).
The head of each business is responsible for ensuring
compliance with these principles and will take appropriate
measures to ensure their implementation.
The Company is in continuous dialogue with social partners on its
sites in Europe, principally through meetings with management
at the European Committee level but also through meetings andnegotiations at national or local level. Sites outside Europe arecovered by Airbus’ ILA framing the social dialogue and social
culture in line with local labour legislation, culture and practicesof respective countries.
Regular social dialogue is ensured as per ILO requirements andlocal legislation thanks to the Company’s Societa Europea WorkCouncil (SEWC) agreement in 2015.
Strengthening the role of industrial relations and social dialogue
is an enabler of shaping the future of work through workplacecooperation, collective bargaining by enhancing cooperation
between employees’ representatives and the top managementof Airbus.
In line with its commitments, the Company demonstrated its
engagement through the following significant milestones in2018:
in 2018, the Company signed the SEWC Reshape agreement
promoting mutual understanding and the co-constructionof transnational solutions, which should be then reflected atnational level. In this frame, the “Airbus Global Forum Initiative”
was launched, with the aim of piloting constructive exchange
of information with staff representatives at a global level, in
line with responsibility and sustainability policies to further
engage the social dialogue towards Company globalisation.
The first meeting was held in June 2019 chaired by the Airbus
Chief Human Resources Officer;
in October 2018, Airbus also joined the Global Deal for Decent
Work and Inclusive Growth initiative (“Global Deal”). Launchedin 2016, the Global Deal is a multi-stakeholders’ partnershipthat seeks to address two of the greatest challenges of ourtime: to reduce high and rising inequalities in opportunities
and outcomes and to restore fading trust in the ability of
governments and institutions to make economic growth work
for all against a backdrop of rapid changes in the world of work.
The Global Deal’s founding principles aim at encouraging
action through voluntary commitments, increasing knowledge
base about social dialogue and sound industrial relations
and providing platforms for sharing experiences and bestpractices. Airbus’ active representation demonstrates that----social dialogue’s globalisation is rooted in the Company’s R&S
strategy and commitments reflecting the Company being an
employer of choice.

1

In France, following the entry into force of a new legislative
framework related to employee representative bodies with thecreation of a single body — the new works council Comité Socialet Économique (CSE) — Airbus seized the opportunity for an
in-depth review of its social dialogue model which resulted in aunanimous signing of six revised agreements pertaining to theregeneration of the social dialogue. These agreements enable
the harmonised development within Airbus in France of a social
dialogue that is more focused on strategic issues and the general
operation of the company with an architecture giving employee
representatives access to an overall vision and the opportunity
to better support the transformation being undergone by Airbus(including digitalisation, new ways of working, competitiveness,etc.), without neglecting representation of proximity.
In a fast-paced transforming business environment, the quality ofsocial dialogue, proximity and cooperation has demonstrated its
added value in supporting our employees. This was accomplishedthrough transnational restructuring plans by negotiating stateof the art accompaniment redeployment measures supporting
impacted employees in a constructive social climate with noprotests and resulting in finding redeployment solutions to 99%
of our employees mainly internally as a result of solidarity andpriority principles founded in the Company’s HR values.
Human Rights
The Company has a zero tolerance approach to all formsof human rights abuse, including modern slavery, within its
business, its operations and within its supply chain.
In light of changing regulatory requirements, Airbus has identified
a risk of insufficient awareness of human rights impacts relating
to its business and its operations. In response, the Company
has decided to launch a programme of work to understandmore fully its negative and positive human rights impacts, andto undertake a human rights gap analysis that will consider
current and upcoming regulatory requirements, international
best practice, the UN Guiding Principles and the UN Global
Compact. This work began in early 2019. Modern slavery risks
will also be covered in the human rights impact and gap analysis.
As part of its obligations under the UK Modern Slavery Act, andin recognition of the global aim of this topic, Airbus publishedits second Modern Slavery Statement in 2018. Modern slavery,
along with wider human rights, is a topic followed by the Airbus
R&S Network. Actions to address these issues and understandassociated risks to its business and supply chain continued
during 2018. For further information on the evaluation of humanrights risks in Airbus’ supply chain, see section 1.1.8.4(b)Responsible Suppliers.
The Company also continued the roll-out of its e-learning
modules focused on helping employees identify the signs ofhuman rights abuse and modern slavery, including raisingawareness of what to do if they have concerns. At the endof 2018, 4,972 employees had completed this e-learning,which is available in four languages and forms part of the
ethics and compliance catalogue of learning. The Company
is also committed to promote awareness through internal
communication initiatives and awareness sessions and to train
its most impacted employees on potential risks.

Airbus / Registration Document 201859

Information on the Company’s Activities /1.1 Presentation of the Company

During 2018, Airbus started to identify potential KPIs related tohuman rights which could be used to measure progress. The
Company is currently evaluating the availability of data in orderto start report using these KPIs.
c. Health and Safety
The health and safety of our employees is a top priority of theCompany. It is the Company’s policy to continuously reinforce
health and safety related to Airbus work activities as part ofthe business culture and to deliver responsible health andsafety management that sustainably reduces risk to people,
the environment and the business.
Governance of Health and Safety at Airbus
A new company-wide Occupational Health and Safety Policy
has been issued in 2018 as the foundation of the Company’ssystem for management of health and safety at work. The new
Policy reflects the changes in company structure and evolving
external and internal requirements.
The purpose of this new policy is to:--reinforce the following principles:--responsible management of health and safety, taking all

feasible steps to protect people and the business fromthe health and safety risks that could arise from its work
activities,
all employees accepting appropriate responsibility forthemselves and others,a health and safety management system that drives
continuous improvement and compliance,a preventative approach based on analysis of leading andlagging indicators and other occupational health and safety
data;
reiteration of the health and safety mission and vision:
our mission is to deliver a culture and management systems
that promote health and safety at work, related compliance,
and the sustained reduction of health and safety risk related
to Airbus work activities,
our vision is that Airbus has world class health and safety
risk management and is known as a company where safety,
health and welfare are valued as an integral part of our
success. Airbus aspires to zero work related injuries andill-health;focus on key initiatives:a health and safety management system based on theprinciples of the ISO Standard 45001,
the implementation of a company-wide health and safety
software platform (Federated Information on Safety and
Health called FISH),
the reinforcement of a company-wide health and safetyfunction by the harmonisation of health and safety philosophy
and methodology.

-----------To achieve the objectives of this Policy, Airbus is consolidating
health and safety resources into a single organisation to delivercompany-wide harmonisation and gain improvements in risk
control and efficiency benefits. In this respect, Airbus has
defined Transversal Expert Groups (TEG), for Industrial Hygiene,
Health and Wellbeing, and Safety Management. These TEG
span Airbus, its Divisions and countries, providing advice andhelping to improve management of risk control work.

60

Airbus / Registration Document 2018

Airbus is structuring its corporate health and safety management
framework based on the principles of the newly introduced
international standard – ISO 45001. The new Policy is one of
the foundation documents which has evolved in this regard.
The FISH management platform and the harmonisation of thecompany-wide health and safety function are two of the pillars
supporting the health and safety management framework forhealth and safety at work. Airbus will progressively certify someentities under ISO 45001.
Tools
The company-wide management framework health and safety
at work is supported by FISH – the global health and safety
software platform. The deployment of this platform started
in 2018 and will enhance Airbus’ incident, risk health andsafety capability. This will enable improved aggregation andanalysis of health and safety data to form a risk topographythat focuses resources to best effect. Such module will support
measurement and evaluation of work-related incidents (e.g.: nearmisses) which will improve accident avoidance.
The incident management module of this platform has been
deployed in France for Airbus commercial aircraft activities andAirbus Helicopters, in Spain for Airbus and its Divisions and in
UK for Airbus’ commercial aircraft activities and Airbus Defence
and Space. It is expected that the full deployment of this modulein the FISH tool will be completed in 2019. Thus Airbus will
progressively improve its ability to collect, analyse and reporton work related health and safety information, continuously
improving the identification and mitigation of risk.
Commencing the deployment of the incident management
module and the overall harmonisation process have allowed
improvement in the production and collection of overall
company-wide KPIs which are detailed below.
Airbus has held an innovation workshop to focus on futuretechnologies to support and reinforce safety and ill-health riskprevention by using new technologies, such as exoskeleton,
ergonomic analysis and virtual reality training.
Risks and Management Performance
The company identifies work-related hazards and seeks toeliminate, substitute, isolate or otherwise manage them tosupport legal and regulatory compliance. It is intended thatcompany processes further be improved through the company
software platform, FISH. Risks that could arise from work
activities include the possibility of injury, physical and mental
ill-health, damage to equipment, business interruption andregulatory action. Any reputational risk and claims against
Airbus that may result will also need to be managed. In 2018,
main causes of injury remain slip, trip and fall events andergonomic/manual handling. Work at height and chemicals
present additional concerns.
Collection of health and safety data is being harmonised
company-wide using common indicators such as Frequency
Rate. The reporting scope of such harmonised health andsafety data (reflected in the table below) covers Airbus and its
Divisions for the four home countries and the Mobile USA and
Tianjin China plants, covering around 92% of the Airbus Active
Workforce, and will be progressively extended. Analyses ofsuch reporting data will continue and evolve in light of the levelof maturity of data collection.

REGISTRATION DOCUMENT 2018
Information on the Company’s Activities /1.1 Presentation of the Company

1

AIRBUS AND ITS DIVISIONS – ROLLING 12 MONTHS EMPLOYEE LOST TIME INJURY FREQUENCY RATE

6

5.73

5.75

J

F

5.64

5.71

5.68

5.74

M

A

M

J

5.87

5.85

5.82

5.83

J

A

S

O

5.93

5.90

N

D

5

4

3

2

1

2018
AIRBUSFISH (the new company-wide software platform for health andsafety) will develop consistency of health and safety incident
reporting and investigation to improve the Company’s incident
management results. This will in turn improve data analysis
capability and help reinforce preventative activities. The People
Safety@Work project was launched for Airbus commercial
aircraft activities mid-2018. This project aims to improve themanagement of work-related healthy and safety injuries inoperational areas and drive a safety mind-set. The project is
structured through a multi-functional team led by all impacted
functions (e.g., Human Resources, Industry, Final AssemblyLine, Facility Management, Procurement).
Key Initiatives
Airbus regularly consults and provides information to employee
representatives, for example in direct meetings and committees.
Airbus has health and safety committees involving employees
and their representatives in line with applicable regulations. As
examples of such interaction, the health and safety software
platform (FISH) project has been presented to more than 25
national and European employee committees and the healthand safety team has contributed to an agreement signed with
French social partners on quality of life at work (Qualité de vie
au travail).

Airbus continues to conduct communication campaigns with theongoing aim of encouraging employees to engage in health andsafety risk management. In April 2018, Airbus held a companywide risk awareness campaign to coincide with the ILO WorldH&S Day, extending to all employees throughout the group.
Numerous other initiatives have been deployed locally on sites
including the Safety Box (a dedicated space for safety training
and information); Safety Road Risk initiatives; the Extended
Enterprise Platform for onsite contractors; and the companywide health and safety colloquium, where health and safety
practitioners meet to exchange ideas and best practices.

The Airbus health and safety training catalogue is constantly
evolving to support Airbus’ risk management activities. Airbus
has defined a health and safety development strategy focusing
on harmonised and standardised training. Airbus is also
continuously developing its health and safety learning catalogue
including digital solutions and alternative learning approaches.
From October 2017 to September 2018, the Company delivered
over 137,000 hours of dedicated health and safety training toapproximately 30,800 individual employees.
Protecting health and safety is one of the Company’s toppriorities, and Airbus is continuously reviewing its meansand processes across plants and sites with this in mind. The“REACH-IT” project within Airbus’ commercial aircraft activities,
including similar initiatives within the Divisions, reviews Airbus
manufacturing processes, tools and workstations in light of the
REACH authorisation application measures for environment,
health and safety protection. It contributes to continuous
improvement.
With regard to sub-contracting, as further detailed in
section 1.1.8.4(b) Responsible Suppliers, Airbus strives tocontinuously improve the integration of health and safety
elements into the purchasing process. Airbus standard
procurement contracts contain health and safety provisions to
be respected by suppliers.
In addition, on-site sub-contracting processes are in place andare continuously evolving with a harmonisation objective. Airbus
identifies potential risks and defines prevention measures incooperation with on-site sub-contractors, jointly producing
dedicated documents, such as the prevention plans in France
or job registration forms in the UK. Airbus then monitors on-site
sub-contracting activities.

Airbus / Registration Document 201861

Information on the Company’s Activities /1.1 Presentation of the Company

OutlookThe health and safety management system aims to focus
on proactive risk assessment and control, role appropriatecompetence and development, and active monitoring, analysis
and oversight reporting. It is key for Airbus to further expand
its health and safety management software platform (FISH)
to enhance the ability to capture company-wide performance
information in a common format to facilitate improved datacollection, analysis and performance. Such data analysis will
help reinforce preventative activities.

Airbus also aims to further use learning to support the integrationof health and safety into the business culture and is therefore
working on the harmonisation of employee training offers for
employees and customisation of such offers, for example
developing specific training for managers and executives.
d. Inclusion and Diversity
The Company is convinced that diversity helps foster innovation,collective performance and engagement. Harnessing everyone’s
unique potential while ensuring an inclusive workplace is what it
takes to succeed together. At Airbus, we live diversity as a core
part of our identity: Airbus is proud of its European roots andpassionate about its achievements around the world. More than
135 nationalities are represented and more than 20 languages
are spoken within the Company.
The Company’s approach to Inclusion & Diversity (“I&D”)
takes different forms including: I&D Steering Board chairedby the Airbus CEO, dedicated training and awareness, internal
incentives for international mobility, initiatives to attract women,
flexible work-life solutions. In fact, the Company strives to ensure
I&D is embedded in all it does, serves business purposes andbenefits all employees worldwide. With full support of theentire HR function, I&D initiatives are run and coordinated by a
dedicated team of experts worldwide. The Company’s efforts
are also supported by several employee networks such as
Balance for Business and platforms for exchange like “Knowing
Me, Knowing You”.
In line with its aspiration for a more diverse workplace, theCompany is working to increase the number of applications
from areas that are currently under-represented in its workforce,
including but not limited to women, nationalities, age groups andsocial backgrounds to ensure a broader range of candidates
for open positions.

In order to support recruitment of women in all areas, Airbus
has entered into partnerships to increase the number of womenstarting a career in the aeronautical industry – for example
with Capital Filles, Women in Aviation, IAWA. Internally, an
I&D network of over 4,000 employees work on how to attract,develop and retain diverse profiles, especially women, in the
Company. In parallel, Airbus strives to increase the number ofwomen in leadership positions, including through dedicatedcoaching and training such as “I Unleash My Potential” as well
as by fighting stereotypes in internal conferences or workshops.
In terms of internationalisation of profiles, Airbus facilitates theattraction of talents from around the world to Airbus’ traditional
home countries (France, Germany, Spain, the United Kingdom)
through an International Graduate Programme enabling talentsfrom all around the world to come and work on their development
over one year at Airbus sites in Europe. In addition, Airbus also
put in place several actions to boost mobility from other regions
to the home countries.
Although the Company welcomes many forms of diversity, itmeasures the evolution of the diversity of its workforce witha specific focus on gender diversity and internationalisation
with key KPIs such as: proportion of women promoted to a
position of senior manager or above, proportion of womenamong white collar external hires, gender pay gap at all levels
between women and men, and the number of moves from the
key countries (including India, China, US) to the home countries.
The Company has launched several actions to embrace otherforms of diversity, including:reverse mentoring to connect all generations in the Company;
accompany the creation of Employees Resource groups like
Pride@Airbus (LGBT+ network);
coordinate all local strategies towards disability with several
thousand differently abled employees all around the world.

----

As far as the Airbus SE Board of Directors is concerned, theCompany is moving in the right direction with 3 women in 2017
compared to not a single woman on the Board in 2013.
For a description of the diversity policy of the Airbus SE Boardof Directors, see “— Corporate Governance — 4.1.1 Corporate
Governance Arrangements” under the heading “Board of
Directors” and “— Corporate Governance — 4.1.2 Dutch
Corporate Governance Code, ‘Comply or Explain’” under theheading “Gender Diversity”.

31 December 201831 December 201731 December 2016

Women in active workforce ✔

17.7%

17.5%

17.2%

Women in management positions ✔

12.6%

12.4%

11.4%

The reference to “management positions” in the figure above only applies to the top 4% of the active workforce.

62

Airbus / Registration Document 2018

REGISTRATION DOCUMENT 2018
Information on the Company’s Activities /1.1 Presentation of the Company

1.1.8.4. Responsible Businessa. Ethical Business Practices
Leading by Example
The Airbus Ethics & Compliance Programme seeks to ensurethat the Company’s business practices conform to applicablelaws, regulations and ethical business principles, as well as
developing a culture of integrity and speak-up.
In 2018, Ethics and Compliance was a top priority for theCompany as for 2017. In its list of priorities for the year, Airbus
set the objective to:“Continue to engage and develop our people worldwide to excel
today and tomorrow by adopting key digital skills and mind-set,
reinforced ethics & compliance adherence and a strong focus
on diversity”.
Compliance is at the heart of everything Airbus does today –Airbus is putting significant resources and effort into supportingthe coordinated criminal investigations by the UK Serious Fraud
Office (SFO) and France’s Parquet National Financier (PNF).
The Independent Compliance Review Panel (ICRP), a panelof eminent external consultants appointed by the Company
in May 2017, has also progressed in its mission over the past
year. The Company is committed to putting in place the ICRP’s
recommendations on how to further improve our compliance
processes, policies, organisation and culture.
Our E&C Organisation
The Ethics & Compliance organisation is part of the Legal
Department under the ultimate responsibility of the Airbus
General Counsel. The aim is to provide strong governancethroughout the Company with the global presence of qualifiedcompliance officers who ensure the compliance programme
is implemented consistently in the different functional andoperational areas.

They do this in close cooperation with its employees andmanagement, who are expected to lead with integrity by
example and take responsibility for compliance within theirscope of activity.
Our Commitment
Over the years, the Company has earned the trust of passengers,
customers, operators and other stakeholders through the quality
and safety of our products. To fully serve our communities andthrive in the future, our commitment to business integrity mustbe just as robust – this means conducting our business ethicallyand based on Airbus values, and in compliance with all laws
and regulations.

As part of this commitment, the Company supports theprinciples of the UN Global Compact and IFBEC’s Global
Principles of Business Ethics which set a benchmark for highethical standards globally.
Our Standards
The foundation for integrity at Airbus is the Standards ofBusiness Conduct. These Standards are intended to guide
daily behaviour and help employees resolve the most common
ethical and compliance issues that they may encounter.

The Standards of Business Conduct apply to all employees,
officers and directors of the Company as well as entities
that the Company controls. Third-party stakeholders whom
the Company engages are also expected to adhere to theseStandards of Business Conduct in the course of performing
work on our behalf.

1

Our Programme
While the Standards of Business Conduct provide a usefulstarting point, they cannot answer all questions, nor are they
sufficient to ensure that the Company complies with the myriad
legal requirements applicable to its business. Because of this,Airbus has worked over the past several years to develop an
Ethics & Compliance programme that is structured aroundthe following key risk areas: Business Ethics/Anti-Corruption
Compliance, Export Compliance and Data Protection
Compliance.

Each of these areas is, in turn, supported by dedicatedcompliance policies and a team responsible for theirimplementation, together with the identification and proposalof new measures to adapt to a constantly evolving regulatory
landscape.
More broadly, the Company’s Ethics & Compliance programmealso covers other areas such as conflicts of interest, anticompetitive conduct, insider trading, fraud, etc., while also
working with the Airbus R&S Network.
Improving the Ethics & Compliance programme is a constantand ongoing process, not only in the area of Business Ethics/
Anti-Corruption but across the ethics and compliance spectrum
more generally in order to capitalise on our values.
Business Ethics/Anti-Corruption Compliance
The Company rejects corruption of any kind, whether public or
private, active or passive. This means that neither the Company,
its employees or third parties acting on its behalf may offer,promise, give, solicit or receive – directly or indirectly – money oranything of value to or from a government official or someone in
the private sector in order to obtain or retain business or securesome other improper advantage.
The Anti-Corruption Policy (available at airbus.com/company/
ethics-compliance.html) summarises its stance of zerotolerance. It also refers to some of the specific directives theCompany has adopted to address key anti-corruption risk areas,such as the engagement of third parties (e.g., business partners,
lobbyists, etc.), gifts and hospitality exchange and the makingof sponsorships and donations.
In addition to these existing anti-corruption directives, in 2018
the following new policies were adopted:
a method defining the requirements for the prevention ofcorruption in the context of international cooperation &offset activities (IC&O), which provides employees with an
explanation of the compliance due diligence that must be
conducted on IC&O third parties depending on the function
or services they perform;a method defining the requirements for the processes for“Manage Staffing and On-Boarding” and “Recruit People”, on
how to manage applications, recommendations and referrals
for recruitment at Airbus;----

Airbus / Registration Document 201863

Information on the Company’s Activities /1.1 Presentation of the Company

method related to the requirements for the investigation of--acomplianceallegations, to ensure that these investigations
are conducted in a consistent and professional manner inaccordance with company standards and relevant laws.

In 2018, the Ethics & Compliance team also worked to alignand integrate the compliance due diligence screening andon-boarding process of suppliers – formerly managed by theProcurement team through its “Watchtower” – into the overall
Ethics & Compliance policy framework and tools. Further
work will be conducted by the E&C team in 2019 to roll-out theprocess consistently across Airbus’ Divisions and subsidiaries.

b. Responsible Suppliers

Each of the countries in which the Company does business has
controls on the export and transfer of its goods and technologies
that are considered to be important to national security andforeign policies. As a global enterprise, it is the Company’s
responsibility to respect and comply with each of these controls.
The Export Compliance Directive defines its policies, processes
and organisation to ensure compliance with all relevant export
control laws and regulations.

The Company designs and integrates complex aerospaceand defence products, leveraging an extensive supply chain.
Co-operation with suppliers occurs in several fields of thebusiness and is key to ensure quality standards which lead toshared success, growth through innovation and a commitment
to sustainability. Airbus also engages its suppliers on its
sustainability journey and shares a commitment to improvesocial and environmental performance, constantly driven byvalues of integrity and transparency.

Data Protection Compliance1. Procurement at Airbus

Export Compliance

Building on the solid Personal Data Privacy policy foundation,
governance and culture in place since years and the Binding
Corporate Rules (available at https://www.airbus.‌c om/
c o n te n t /d a m /c o r p o r a te -to p i c s /c o r p o r a te - s o c i a l responsibility/ethics-and-compliance/Airbus-BindingCorporate-Rules%20.pdf) into force across the group since2014, the Company fully commits to Privacy and the General Data
Protection Regulation (“GDPR”) requirements in its operations
and products. Thus the Company has deployed updated
policies, tools and practices across its entire organisation tomeet the Privacy by Design and other GDPR requirements into
force since May 2018.
Awareness and Training
The Company aims to educate its people about the standards ofconduct that apply to their jobs and the potential consequencesof violations. Target populations are reviewed annually andrequired to undergo training and awareness eLearning or face
to face sessions based on job function, role and responsibility.
In 2018, the Company’s employees followed 204,667 Ethics &Compliance digital training sessions. In coordination with aneffort to increase accessibility to the digital learning platform,
one of Airbus’ 2018 objectives was for all employees with accessto a computer to perform an Ethics and Compliance digitaltraining session.
Speak-Up Channel: OpenLine
The Company recognises that the Standards of BusinessConduct cannot address every challenging situation that may
arise. The Company therefore encourages its employees to
speak-up through various channels, including through OpenLine(available at https://www.airbusopenline.com/). The OpenLine
enables users to submit in good faith an alert securely andconfidentially and also to ask all questions related to Ethics andCompliance. In 2018, the Company decided to further improve
the accessibility and use of the OpenLine by extending thegeographical coverage of the tool, which should allow accessto all employees based in the countries where Airbus operates.

64

The Company also decided to extend the scope of the OpenLine
to responsibility and sustainability related topics. Finally, andbeyond already existing measures to preserve the confidential
use of the OpenLine, users are offered a new option allowing
them to remain anonymous, where legally permissible. Allof these improvements came into force on 1 January 2019.
The Company does not tolerate retaliation against employees
making reports in good faith and/or assisting in investigationsof suspected violations of the Standards of Business Conduct.
For further information, visit the OpenLine website.

Airbus / Registration Document 2018

More than 12,000 suppliers from more than 100 countries
supply parts, components or sub-systems to Airbus. In 2017,
the overall external sourcing volume of Airbus is valued at around€ 52 billion.
Whilst Airbus products and services are sold all over the world,the majority of its workforce and supply chain are based inEurope and the Organisation for Economic Cooperation andDevelopment (OECD) countries. In the past few years, thesupply chain has become concentrated and more international.
Such rising concentration is the result of consolidation within
the aerospace and defence sector, as well as larger work
packages for the major new aircraft programmes being placedwith a smaller number of lead suppliers. Airbus has identified
global sourcing as one of its leading long-term objectives. To
promote the globalisation of its sourcing footprint, an Airbus
Global Sourcing Network (GSN) has been established including
regional sourcing offices in USA, China and India.
The Airbus “Procurement Academy” provides training on corecompetences and skills to develop procurement expertise. andprepare Procurement employees for the challenges of the future.
2. Responsible Supplier Management
As a global leader in aeronautics and space, the Company hastaken a commitment to conduct its business responsibly andwith integrity. Taking into consideration the level of outsourcing
at Airbus, the supply chain is an integral part of Airbus’
ecosystem and the Company is therefore committed to ensure
that, as far as possible within its own scope of responsibility andlegal obligations, potential adverse impacts of the Company’s
activities are managed.
Airbus suppliers must comply with all applicable laws andregulations of the countries in which operations are managed
or services provided. In addition, wherever suppliers are located,
all business should be conducted in a manner compatible with
the Airbus Supplier Code of Conduct.

REGISTRATION DOCUMENT 2018
Information on the Company’s Activities /1.1 Presentation of the Company

The Airbus Supplier Code of Conduct is the document ofreference for Airbus’ responsible supplier management (available
at https://www.airbus.com/content/dam/corporate-topics/
corporate-social-responsibility/ethics-and-compliance/
Supplier-Code-Conduct-EN.pdf). This Code represents thegroup-wide values and principles in line with internationallyrecognised standards and conventions (such as OECD and
ILO). Airbus implemented the International Forum on Business
Ethical Conduct (“IFBEC”) Model Supplier Code of Conduct
in its entirety as the Airbus Supplier Code of Conduct in 2016.
The Supplier Code of Conduct was sent to the 12,000 main
suppliers across the world with a letter from the Airbus’ Chief
Procurement Officer and the Airbus General Counsel requesting
a commitment to the Code. Airbus expects its suppliers tocomply with the key values set out in this. Suppliers are also
expected to cascade these principles throughout their own
supply chains.
Supplier Mapping
As part of supplier management activities for commercial
aircraft, Airbus has put in place, the Supplier Mapping toolwith multiple capabilities, notably to identify Airbus supply
chain sub-tiers and support identification of risks of supplier
non-performance. In 2018, a total of 8,680 suppliers from 64
countries were identified by the Supplier Mapping tool of which
1,071 were tier-one suppliers, 6,473 second tier suppliers, 1,314
qualified sub-tiers suppliers. A total of 141,148 activities wereinvolved and 45 quality alerts resulted from 422 analyses andreports. The alerts were managed internally by the Procurement
supply chain management department.
Ethics & Compliance Supplier Watchtower
in 2018, the Ethics & Compliance Supplier Watchtower was
managed by the Procurement Ethics & Compliance department
proactively checking specific suppliers for compliance aspects.

In 2018, suppliers were checked depending on the risks linked
to their country of registration. The risk rating of countries isdefined by the Procurement Compliance department andupdated regularly. Criteria comprise export restrictions andresponsibility and sustainability-related elements such as anticorruption, human and labour rights.
Supplier Integrity Checks investigate compliance concerns
which are triggered by certain business relationships. Such
concerns are comprised of, for the Company or its ownership,
among others: legal investigations or judgements, negative
press reports, incidents of corruption, listings on sanction
lists/blacklists, proximity to governments or risky entities(shareholders, customers, beneficial owners and subsidiaries). In
case a Supplier Integrity Check yields concerns, a Procurement
management meeting is held to discuss potential additional due
diligence measures and mitigation actions. About 700 Supplier
Integrity Checks were conducted each year in both 2017 and2018.
A Supplier Integrity Check can be performed on demand and isalso embedded in the supplier registration process and eProc,an electronic platform where buyers and suppliers perform
all aspects of calls for tender, from identification of potential
suppliers, contract awarding, to supplier evaluation and spend
analysis.

Environment, Health and Safety in the Supply Chain
Identification of potential risks related to legal and regulatory
requirements that may be applicable to Airbus’ management ofcompliance of its activities and products and the communicationof information on the composition of its products depends toa large extent on the level of information made available by the
supply chain.

1

Airbus Procurement is continuously striving to improve theintegration of environmental, health and safety elements into
the purchasing process.
Current standard procurement contracts include i) requirements
for suppliers to comply with all applicable laws and regulations
regarding, products and services and ii) requirements for
suppliers to provide information on substances used in
manufacturing processes, contained in their products and on
environmental, health and safety matters, including information
for management of the product across its lifecycle (including
waste management). Suppliers are also requested to implement
an Environmental Management System – based on ISO 14001
or equivalent – which shall consider continuous improvement
through the mitigation of significant environmental aspects andimpacts, including air emissions (e.g., greenhouse gas, volatileorganic compounds); waste, water discharges, raw material
consumption.
Regarding supplier environmental control and monitoring,
Airbus performs the following activities: collecting data fromsuppliers is made through a Material Declaration Form to enableAirbus to identify which substances are used, tracking anddeclaring them in the frame of substances regulation such as
REACH. Environmental requirements are included in supplieraudits and the Industrial Process Control Assessment (IPCA).
In addition, the Environmental Obsolescence Risk at Supplierquestionnaire (EORS) assesses the level of maturity of supplierprocesses to manage Airbus environmental requirements andregulated substances obsolescence. EORS is applicable to all
Airbus Commercial Aircraft suppliers – for the time being EORS
campaigns have targeted the suppliers of cabin, systems andequipment, engines and nacelles products.
As mentioned above under section 6.1.2(c) Environment, Airbus
is a founding member of IAEG, which is working on enablinga common approach at industry level, in regard to standards
and tools to manage environmental obligations.
The Procurement function is ISO 14001 certified as part of the
global Airbus environmental certification.
Zero Tolerance Approach to Modern Slavery in the Supply Chain
As previously mentioned under section 1.1.8.3(b) under “Human
Rights” as part of its obligations under the UK Modern Slavery
Act, the Company published its second Modern Slavery
Statement in 2018 in recognition of the global aim of this
topic. Modern slavery, along with wider human rights, is a
topic followed by the Airbus R&S Network and Supplier R&S
Programme. Actions to address these issues and understandassociated risks in the supply chain continued during 2018
and are detailed in the chapter in regards to the Vigilance Plan.

In addition, the Company continued the roll-out of its e-learning
modules focused on helping all employees identify the signsof human rights abuse and modern slavery, including raisingawareness of what to do if they have concerns. This e-learning,
available in four different languages, is part of the mandatory

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Information on the Company’s Activities /1.1 Presentation of the Company

Ethics & Compliance catalogue of learning. The Company alsoplans to launch an in-depth training course specifically focusedon human rights and modern slavery for employees engagedin activities in high risk areas identified through its supplier risk
mapping and assessment.
Promoting Disability Friendly Companies
Since 2011, Airbus in France has been promoting employmentof people with disabilities by its suppliers. Concretely, a specificmention is integrated into all relevant calls for tender launched,requesting bidding suppliers to propose a partnership with adisability friendly company.

At the end of 2017, the global volume of business with disability
friendly companies in France was € 44.5 million with an increaseof 19% compared to 2016 for Airbus in France. At the end of
2018, 56 disability friendly companies are working with Airbus
compared to 10 in 2010. An extension of this project to Airbus
sites in Spain and Germany is planned based on the samephilosophy: create jobs for people with disabilities in specialised
companies.
3. Moving forward: Airbus Supplier R&S Programme:
Vigilance Plan
To deliver parts, components, sub-systems or services, quality,
reliability and economic efficiency is key to its operations.
However, Airbus believes that this should not be at any costand as such is committed to engage in due diligence actions
with its suppliers with regard to issues of Responsibility andSustainability.
Airbus strives to make Responsibility & Sustainability acore element of its procurement process. Airbus has a longestablished and integrity-driven procurement process which
manages relationship with suppliers from strategy, supplierselection, contract management to supplier management.
Environmental activities in Procurement have paved the way
to integration of wider corporate social activities within the
supply chain.
Airbus acknowledges the challenge of obtaining sufficientvisibility of its supply chain and recognises a risk regarding
supplier compliance relating to stronger R&S regulations interms of human rights, labour and environmental standards
in the global supply chain. Willing to encourage developmentof responsible suppliers and manage the potential adverse
impacts of its activities as well as to create new opportunities,
in 2017 Airbus launched a Supplier R&S Programme, followinginternational guidance such as the OECD guidance on
responsible business conduct.
The Supplier R&S Programme initiated and defined in 2017 for
Airbus’ commercial aircraft activities will continue and evolve
year on year on the principle of continuous improvement androll-out in Airbus’ Divisions. In 2019, Airbus also launched theSupply Chain Environmental Sustainability (SCES) project tocomplement the response to the Vigilance Plan. The Supplier
R&S Programme has been presented to and is regularly
reviewed by the Procurement Executive Team led by the Airbus
Chief Procurement Officer.
The Supplier R&S Programme and its activities are managed
by the Airbus Procurement Ethics & Compliance department,
together with relevant Airbus Procurement stakeholders. To thisend, the existing Airbus Procurement environmental network

66

Airbus / Registration Document 2018with representatives from the different Procurement categories
of purchase has been extended to cover other R&S topics.
The aim of this network is to ensure that the entire Airbus
Procurement community is made aware of R&S-related topics
and support the identification of risks according to the categoryof purchase. The Airbus Procurement R&S network can also
support initiating cooperation with suppliers as well promoting
industry-recognised practices. Additional governance exists
with the corporate R&S, Legal and Ethics & Compliancedepartments. The Supplier R&S Programme manager is alsopart of the corporate cross-functional Airbus R&S Network.
The Supplier R&S Programme is based on the following four
key elements:
A. R&S-Related Risk Identification and Mapping
All Procurement related risks for Airbus commercial aircraft
activities are embedded into the Company’s ERM system. A
specific risk category regarding R&S-related risks in the supply
chain has been integrated into the ERM system.

The Procurement function supported by the Procurement risk
department manage ERM in procurement fields, as well as
duly report issues to top management. Along with identification
and reporting of R&S-related risks, a proactive supplier R&S
risk mapping has been performed in line with international
guidance. The risk mapping resulted from both a country risk
and a purchasing category approach for human and labour
rights and environmental matters. The R&S-related risks levelsin the existing supply base require an in-depth analysis andreview with the relevant Procurement commodities to agree on
the deployment of the relevant internal and external mitigation
actions.
This supplier risk mapping aims to detect areas where
procurement activities are exposed to significant potential
risks. With those suppliers linked to higher risk activities,
specific actions started in 2017 and implementation continued
in 2018. For new suppliers joining the Airbus supply base such
mitigation actions currently include the performance of Supplier
Integrity Checks (see previously mentioned part on Ethics &Compliance Supplier Watchtower) and on-site assessments
including questions to evaluate maturity on Responsibility &Sustainability. New mitigation actions in the existing supply
base such as dedicated R&S Supplier assessments started
to be implemented in 2018 in a trial phase with a specialist
service provider.
B. R&S in Supplier Selection and Contracting
For the last few years, Procurement standard contracts
have evolved to include clauses on specific topics such asenvironment. In 2018, a more detailed clause on anti-corruption
has been incorporated into procurement contract templates tofurther specify Airbus’ requirements in this domain.

Furthermore, Airbus has agreed to reinforce R&S-related
requirements such as those on human and labour rights
along the selection and contracting phase with suppliers. In
2018 the Supplier Code of Conduct has been integrated asa new R&S annex in Airbus standard contract templates. The
implementation will be rolled out according to the contractual
roadmap of each purchasing commodity. During the call for
tender phase, results of the R&S-related risk assessment will be
used to require further supplier evaluation if deemed necessary.

REGISTRATION DOCUMENT 2018
Information on the Company’s Activities /1.1 Presentation of the Company

To enable successful implementation, Airbus will perform
training and awareness activities for its buyers in addition to thespecific training that already exists in the areas of environment
and ethics and compliance.
C. R&S Supplier Evaluation and Continuous Improvement
Supplier R&S-related evaluation assesses the compliance of
suppliers with Airbus requirements in these fields and allows theidentification and integration of potential supplier improvement
actions. In 2018 Airbus has started the supplier assessment
activities in a trial phase with a specialist service provider thatassesses social criteria including human and labour rights andenvironmental performance of 55 potentially critical suppliers in
relation to R&S risks. Based on the outcome of the trial phase
Airbus will define the long-term solution of regular supplier R&Srelated evaluation and audits and its integration in the existing
supplier assessment activities, such as supplier self-evaluation,
desktop review or onsite audits. Airbus is also exploring potential
solutions for the wider aerospace and defence sector via its
participation to sector national associations. Clear guidance on
how to manage audit results and mitigation actions are being
integrated into the relevant Procurement processes.
D. R&S in the Procurement Process
Airbus is currently assessing all Procurement processes andtools in order to integrate R&S-related requirements where
relevant on top of environmental requirements, which are alreadylargely considered. This will lead over the next years to theadaptation of Procurement process documentation managed
by the Procurement strategy teams and set-up of dedicated
R&S monitoring tools.

development of its employees, investing five times more than
the national average per employee. The Company’s employees
receive 4 hours more training per employee than the averagefor the Spanish industrial sector and 11 hours more than thenational average.

1

On a municipal level, in Toulouse in 2018, the Company continued
to support regional economic, academic and institutional
players to create the conditions for long-term sustainability
and the development of innovation. Airbus provided answers
to calls for cooperation in the areas of artificial intelligence, data
management and urban mobility as well as sustainability andquality of life in the region. In terms of mobility, the partnershipwith Toulouse Metropole reached a new milestone in 2018 withthe deployment of a car-sharing initiative on all Airbus sites. The
job fair Carnet de Vol gathering over 650 young professionals
and 80 companies and the launch of an employers’ groups(GEIQ) supporting insertion and training of young professionals
around digitalisation were key highlights in terms of humancapital resources.
Sponsorships and donations are often meaningful ways to havea positive global impact in the communities and society at large.
By leveraging its skills, know-how, expertise and passion of its
employees, the Company can bring positive contributions tolocal communities around its sites. The Company’s directive
on sponsorships, donations and memberships provides aCompany-wide framework to ensure its local actions are alignedwith global strategy, priorities and values. While it naturally
supports the local aerospace and defence community, theCompany encourages initiatives around:
Education and Youth Development (preferably in Science,
Technology, Engineering and Mathematics (STEM));
Corporate citizenship and/or local community engagement;
Humanitarian and/or Environment;
Innovation, R&T and Science.

-----

In 2018 Airbus started to implement the above four elements,
deploying corresponding targets for each of them. The
programme is integrated into Airbus’ Procurement strategy
and the embodiment of R&S compliance in supplier selection
and management across the supply chain was part of the 2018
Procurement priorities for all employees. The R&S activities are
discussed and reviewed by a steering committee composed of
the Executive Committee of Procurement.

In addition, the Company is an active member in several industry
or other associations, and national or international advocacy
organisations, such as GIFAS, World Economic Forum andAdvanced Robotics for Manufacturing – ARM institute.

c. Community Engagement

Volunteering at Airbus

The Company recognises the importance of contributing to thedevelopment of the communities in which it operates. Airbus
was created by establishing a European partnership not only
on one aircraft programme but on a long term industrial project.
This same spirit of cooperation drives the development of theCompany’s international footprint. The Company’s approach tocommunity engagement is driven by the willingness to develop
a win-win cooperation with the local eco-system and often
materialises through partnerships with local NGOs, institutions
and other companies.

In 2018, more than 5,000 employees of the Company wereinvolved in volunteering for 97 initiatives.

Local Involvement

The Airbus Foundation

On a country level, take Spain as an example. In addition, in
2017, the direct contribution of the Company to the GDP of
Spain was just under € 1.3 billion, which represents 0.12% ofnational GDP and 60.7% of the contribution to GDP madeby the sector. In addition, the Company stands out in Spainfor its contribution to quality employment. The percentageof permanent contracts exceeds the national average by 11
percent and 100% of its employees are covered by a collective
agreement. The Company is also committed to training and

The Airbus Foundation’s goal is to support the international
aid organisations in regions where the Company operates andbeyond. It brings products and resources, from relief flights tosatellite imagery, to the humanitarian aid community to help
alleviate some of the world’s most pressing challenges.

The Company encourages and looks for ways to facilitate its
employees’ social and environmental initiatives to contribute tosocietal challenges in the communities around their workplaces.
For example, each week during term time, 115 employees from
Airbus’ Filton site in Bristol, UK, voluntarily go into local primaryschools to provide valuable support in reading and maths hence
contributing to SDG4.

Through its Humanitarian Flight Programme, the Foundation
offers Airbus customers to use the delivery of their new aircraft tocontribute to humanitarian efforts. By doing so, the programme

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Information on the Company’s Activities /1.1 Presentation of the Company

helps the humanitarian community reduce its high logistics costs
by delivering medical and school supplies, food, water sanitationequipment, toys, clothing and emergency response units to themost vulnerable around the world. The programme also utilises,
where possible, Airbus flight test aircraft for such missions.
Since its launch in 2008, Airbus Foundation has coordinated66 humanitarian flights, delivering over 827 tonnes of aid inover 27 countries. Since 2012, 495 helicopters flight hours
have been chartered in 15 countries, amounting to € 820,000.
Finally, satellite images can be used to assist humanitarianorganisations in the wake of a crisis in a number of ways. In 2017,a Foundation branded satellite portal was opened, providing freeof charge access to satellite imagery to selected partners withwhom we have entered into partnerships, including IFRC, WFP,ACF, MSF and KRC. To date, it was responded to 15 requests
for satellite imagery to help our partners make assessments
following crisis or disaster situations.
Since the launch of its youth development activities in 2012,
more than 11,750 young people worldwide were involved with

68

Airbus / Registration Document 2018the aim to help them prepare for tomorrow’s challenges. Morethan 1,980 Airbus volunteers supported these programmes. One
of its flagship programmes, the Flying Challenge, focuses on
young people who are at risk of dropping out of the educational
system and subsequently missing training and employment
opportunities. The programme has been deployed in sixteen
Airbus sites across France, Germany, Spain, the UK, the US
and Brazil.
With programmes like the Airbus Foundation Little Engineer (ALE)and Discovery Space (AFDS), the Foundation uses aerospace
to spark an interest in STEM, facilitating the access to STEM
skills for thousands of young minds around the world. In 2018,
over 5,800 students participated to the ALE programme; andsince its launch in May 2018, the Airbus Foundation Discovery
Space digital platform has reached more than 7,000 sciencecentres and obtained over 50,000 content views.
For more information, please refer to the latest Airbus Foundation
Activity Report (available at www.airbus.com).

REGISTRATION DOCUMENT 2018
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Airbus / Registration Document 2018

69

2
Chapter70

Airbus / Registration Document 2018

2

Management’s Discussion
and Analysis of Financial
Condition and Resultsof Operations
2.1
Operating and Financial Review72
2.1.1 Overview73
2.1.2 Significant Accounting Considerations,
Policies and Estimates76
2.1.3 Performance Measures
77
2.1.4 Results of Operations82
2.1.5 Changes in Total Equity(Including Non-Controlling Interests)
87
2.1.6 Liquidity and Capital Resources
88
2.1.7 Hedging Activities
91
2.2

Financial Statements

92

2.3

Statutory Auditor Fees

92

2.4

Information Regarding the Statutory Auditor

93

Airbus / Registration Document 201871

Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.1 Operating and Financial Review

2.1 Operating and Financial Review
The following discussion and analysis is derived from and should be read together with the audited
IFRS Consolidated Financial Statements as of and for the years ended 31 December 2018 and2017 and the Unaudited Condensed Interim IFRS Consolidated Financial Information for the threemonth period ended 31 March 2019 and 2018. These financial statements have been prepared inaccordance with International Financial Reporting Standards (“IFRS”) issued by the International
Accounting Standards Board as endorsed by the European Union, and with Part 9 of Book 2of the Dutch Civil Code. When reference is made to “IFRS”, this intends to be EU-IFRS.
The following discussion and analysis also contains certain “non-GAAP financial measures”, i.e.
financial measures that either exclude or include amounts that are not excluded or included in themost directly comparable measure calculated and presented in accordance with IFRS. Specifically,
the Company makes use of the non-GAAP financial measures (i.e. Alternative Performance
Measures) “EBIT Adjusted”, “net cash” and “Free Cash Flow”.
The Company uses these non-GAAP financial measures to assess its consolidated financial andoperating performance and believes they are helpful in identifying trends in its performance. These
measures enhance management’s ability to make decisions with respect to resource allocation
and whether the Company is meeting established financial goals.
Non-GAAP financial measures have certain limitations as analytical tools, and should not be
considered in isolation or as substitutes for analysis of the Company’s results as reported under
IFRS. Because of these limitations, they should not be considered substitutes for the relevant IFRS
measures.
The Company also measures and communicates its performance on the basis of “EBIT” (reported).

Reporting in Registration Document
The Management’s Discussion and Analysis of Financial Condition and Results of Operations
contained in Section 2 of this Registration Document reflects the new segment structure as
described in section 2.1.1.2. The 2017 financial information has been restated to provide comparative
information with respect to the new segment structure.
The Company has implemented IFRS 15 “Revenue from Contracts with Customers” on 1 January
2018. The Company has restated the comparative 2017 financial information under IFRS 15 whenrequired.
The 2016 financial information has not been restated under IFRS 15. For comparative purposes,
the 2017 financial information before the application of IFRS 15 is also presented. The financial
information that has not been restated is referred to as “reported” or “as reported”, i.e. not restated.
In addition, the 2018 financial information has been prepared under IFRS 9 “Financial Instruments”,
using the limited exemption in IFRS 9 relating to transition for classification and measurement offinancial instruments and impairment. Accordingly, the Company has not restated the comparative
periods.
On 1 January 2019, the Company adopted the new standard IFRS 16 “Leases” using the modified
retrospective method, with no restatement of comparative information, and the new interpretation
IFRIC 23 “Uncertainty over Income Tax Treatment”, for which it has elected to apply the limited
exemption relating to transition for classification and measurement, and accordingly has notrestated comparative periods.
72

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REGISTRATION DOCUMENT 2018
Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.1 Operating and Financial Review

2.1.1 Overview
With consolidated revenues of € 63.7 billion in 2018 (€ 12.5 billion
in the first three months 2019), the Company is a global leader
in aeronautics, space and related services. The Company
offers the most comprehensive range of passenger airliners.
The Company is also a European leader providing tanker,
combat, transport and mission aircraft, as well as one of theworld’s leading space companies. In helicopters, the Company
provides the most efficient civil and military rotorcraft solutions

2.1.1.1

worldwide. In 2018, it generated 84%of its total revenues in
the civil sector (compared to 83% in 2017 (restated)) (first threemonths 2019: 86%) and 16% in the defence sector (compared
to 17% in 2017 (restated)) (first three months 2019: 14%). As
of 31 December 2018, the Company’s active headcount was
133,671 employees (31 March 2019: 135,468 employees),
mainly reflecting perimeter change from acquisitions.

2

Exchange Rate Information

The financial information presented in this document is expressed in euro, US dollar or pound sterling. The following table setsout, for the periods indicated, certain information concerning the exchange rate between the euro and the US dollar and poundsterling, calculated using the official European Central Bank fixing rate:
AverageYear ended€/US$

31 December 201631 December 2017

Year-end
€/£

€/US$

€/£

1.10690.81951.05410.8562

1.12970.8767

1.19930.887231 December 20181.18100.88471.14500.894531 March 20191.13580.8725

1.12350.85832.1.1.2

Reportable Business Segments

The Company operates in three reportable segments whichreflect the internal organisational and management structure
according to the nature of the products and services provided.
(formerly Airbus Commercial Aircraf t and--Airbus
Headquarters) — Development, manufacturing, marketingand sale of commercial jet aircraft of more than 100 seats;
aircraft conversion and related services; development,
manufacturing, marketing and sale of regional turboprop
aircraft and aircraft components. It also includes the holding
function of the Company and its bank activities.
Airbus Helicopters — Development, manufacturing,marketing and sale of civil and military helicopters; provisionof helicopter related services.
Airbus Defence and Space — Military Aircraft design,development, delivery, and support of military aircraft suchas combat, mission, transport and tanker aircraft and theirassociated services. Space Systems design, development,delivery, and support of full range of civil and defence
space systems for telecommunications, earth observations,navigation, science and orbital systems. Communication,
Intelligence and Security provision of services around dataprocessing from platforms, secure communication and cybersecurity. In addition, the main joint ventures design, develop,
deliver, and support missile systems as well as space launcher
systems. Unmanned Aerial Systems design, development,delivery and service support.
“Transversal/Eliminations” comprises other activities notallocable to the reportable segments, combined together
with consolidation effects.

---

--

2.1.1.3

Significant Programme Developments,
Restructuring and Related Financial
Consequences in 2016, 2017 and 2018

The following paragraphs present significant programme
information for the past three years. Prior year figures (i.e.
2016 and 2017) have not been restated due to the applicationof IFRS 15. 2018 description includes previous year figures
restated due to the application of IFRS 15. In addition, relevant
information related to the first quarter 2019 has been included.
A380 programme. In 2016, Airbus found an agreement with
Emirates and Rolls Royce to shift six deliveries from 2017 into
2018 and from 2018 into 2019, which secured the delivery profile
into 2019. 12 aircraft remained the 2018 target for deliveries.
Fixed cost reduction measures were accelerated to minimise
the impact on breakeven at a lower level of deliveries. A totalof 28 A380s were delivered during 2016.
In 2017, Airbus delivered 15 A380 aircraft and planned todeliver 12 aircraft in 2018 and 8 aircraft in 2019. The Emirates
order in February 2018 provided increased visibility on the
A380 programme for the years to come. Based on that order,
at a baseline of 6 deliveries per year, Airbus could produce
the A380 in an industrial efficient way over the coming years.
A reasonable industrial efficiency could be maintained at abaseline of 6 aircraft a year with an acceptable margin andcash dilution. As of 28 February 2018, Airbus had 331 orders
for A380s, of which 222 had been delivered to 13 airlines. At
that time, the A380 order book included orders for 8 customers.
As of 31 December 2018, the Company’s largest A380 operator
has reviewed its aircraft fleet strategy going forward and has
concluded it is forced to restructure and reduce its A380 orderby 39 aircraft. The Company entered into discussions with thecustomer in late 2018 which finally resulted in the signatureof a head of agreement on 11 February 2019. Without thiscustomer’s A380 order, the Company has no substantial orderbacklog and no basis to sustain A380 production, despite all

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Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.1 Operating and Financial Review

sales and marketing efforts in recent years. As a consequenceof this decision, deliveries of the A380 will cease in 2021.
At year-end 2018, in view of the above, the Company has
reassessed accordingly the expected market assumptions andthe recoverability and depreciation method of specific assets
allocated to the A380 programme. As a result, the Company
has impaired specific A380 assets in the amount of € 167 million,
recognised an onerous contract provision for an amount of€ 1,257 million and updated the measurement of refundable
advances including interest accretion for a total amount of€ 1,426 million. As a consequence, the recognition of theonerous contract provision as well as other specific provisions
and the remeasurement of the liabilities have negatively affected
the consolidated income statement before taxes by a net€ 463 million in EBIT and positively impacted the other financial
result by € 177 million as of 31 December 2018.
A350 XWB programme. In 2016, Airbus delivered 49 A350 XWB
aircraft, including to 7 new customers. To reflect expected
lower revenues escalation, increased learning curve costs anddelivery phasing, Airbus recorded a net charge of € 385 million
on A350 XWB loss making contracts in the second quarter 2016.
In 2017, Airbus delivered 78 A350 XWB aircraft. The levelof outstanding work in the Final Assembly Line had beensignificantly reduced. Despite the progress made, challenges
remained with recurring cost convergence as the ramp-up
continued. The A350 programme was preparing to reach thetargeted monthly production rate of 10 by the end of 2018.
In 2018, Airbus has delivered 93 A350 XWB aircraft. New
order intakes, cancellations, delivery postponements andother contractual agreements to the end of December 2018
have been reflected in the financial statements. The industrial
ramp-up is progressing and associated risks continue to beclosely monitored in line with the schedule, aircraft performanceand overall cost envelope, as per customer commitments.
Despite the progress made, challenges remain with recurring
cost convergence as the ramp-up continues.
In the first three months 2019, Airbus has delivered 22 A350 XWB
aircraft.
A400M programme. Technical progress on the A400M
programme resulted in the recognition of A400M-related
revenues of € 1.7 billion in 2016, € 1.9 billion in 2017 (reported),€ 2.2 billion in 2017 (restated) and € 2.1 billion in 2018.
In 2016, 17 A400M aircraft were delivered, resulting in 38
cumulative deliveries up to 31 December 2016. Acceptanceactivities of one additional aircraft were finalised at the endof December 2016, but transfer of title only took place on
1 January 2017 (corresponding revenues were recognised in2017). Industrial efficiency and military capabilities remained
a challenge for the A400M programme and furthermore, the
EASA Airworthiness Directive, linked to the Propeller Gear Box(“PGB”) on the engine, and various PGB quality issues strongly
impacted the customer delivery programme. The first major
development milestone of the mission capability roadmap
defined with customers earlier in 2016 was successfullycompleted in June with certification and delivery of “MSN 33”,
the ninth aircraft for the French customer, however achievementof contractual technical capabilities remained challenging. In
the first half-year 2016, management reviewed the programmeevolution and estimated contract result incorporating theimplications at this time of the revised engine programme74

Airbus / Registration Document 2018

and its associated recovery plan, technical issues related tothe aluminium alloy used for some parts within the aircraft,recurring cost convergence issues, an updated assumptionof export orders during the launch contract phase and finallysome delays, escalation and cost overruns in the development
programme. During the second half-year 2016, the programme
encountered further challenges to meet military capabilities andmanagement reassessed the industrial cost of the programme,
now including an estimation of the commercial exposure. As aresult of these reviews, Airbus Defence and Space recorded acharge of € 2,210 million in 2016 (thereof € 1,026 million in thefirst half-year 2016). This represented the best management
assessment at the time.
In 2017, 19 A400M aircraft were delivered. In total, 57 aircraft havebeen delivered as of 31 December 2017. In 2017, the Company
continued with development activities toward achieving therevised capability roadmap. Given the order of magnitudeof the cumulative programme loss, the Board of Directors
mandated the management in February 2017 to re-engage withcustomers to cap the remaining exposure. The Company signeda Declaration of Intent (“DOI”) with the A400M Launch Customer
Nations (Germany, France, United Kingdom, Spain, Turkey,
Belgium, Luxembourg) defining the framework for achieving
a mutually binding contract amendment initially expected laterin the year. The Company, European defence agency OCCAR(who is managing the A400M programme on behalf of theseven Launch Customer Nations) and the Customer Nations
had agreed to work on a number of contractual elements
including a revamped delivery plan as well as a roadmap forthe development and completion of military capabilities for the
A400M. The DOI, finalised on 7 February 2018, represents
an important step towards reaching a contractually binding
agreement also mitigating the commercial exposure whilesatisfying customer needs with regard to capabilities andavailability of the aircraft. This DOI provided a new baselineon which to evaluate the A400M contract. A detailed reviewof the programme concluded in the fourth quarter of 2017
including an estimate of the financial impacts of the above
mentioned adaptations on schedule, capabilities and retrofit
resulted in an update of the loss making contract provision of€ 1,299 million (reported) for the year 2017 (restated equivalentloss following the implementation of IFRS 15 was € 992 million
for the year 2017). The Company’s remaining exposure going
forward is expected to be more limited.
In 2018, 17 A400M aircraft were delivered. In total, 74 aircraft
have been delivered as of 31 December 2018. The Company
continued with development activities toward achieving therevised capability roadmap with the achievement of an importantdevelopment milestone according to schedule. Retrofit activities
are progressing in line with the customer agreed plan.
In 2018, the Company has been working together with OCCAR
and concluded the negotiations on a contract amendment. In
the fourth quarter 2018 an update of the contract estimate atcompletion has triggered a net additional charge of € 436 million.
This reflects the outcome of the negotiations, updated estimateson the export scenario during the launch contract phase of the
A400M programme as well as applicable escalation and somecost increases. The contract amendment has been successfullycompleted in June 2019, after each nation finalised their domestic
approval processes. This new contract de-risks the programme
and provides the Company, OCCAR and customers greater
visibility, which supports future planning and preparedness.

REGISTRATION DOCUMENT 2018
Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.1 Operating and Financial Review

Yet, despite the progress, the A400M programme is not entirely
risk free. Risks remain on development of technical capabilities
and the associated costs, on securing sufficient export orders intime, on aircraft operational reliability in particular with regards
to engines, and on cost reductions as per the revised baseline.
The A400M contractual SOC 1, SOC 1.5, SOC 2, SOC 2.5
and SOC 3 development milestones remain to be achieved.
SOC 1 fell due end October 2013, SOC 1.5 fell due end
December 2014, SOC 2 end of December 2015 and SOC 2.5
end of October 2017.
The associated termination rights became exercisable by
OCCAR on 1 November 2014, 1 January 2016, and 1 January
2017, respectively. Management judges that it is highly unlikelythat any of these termination rights will be exercised as with theupcoming contract amendment these termination rights will becompletely reviewed.
During the first three months 2019, 1 A400M aircraft has beendelivered, totalling 75 aircraft as of 31 March 2019.
A320 programme. In 2016, 68 aircraft on the A320neo
programme were delivered to 14 customers. Both engine
suppliers committed to deliver in line with customer expectations.
Challenges remained with the A320neo ramp-up and delivery
profile. For the Pratt & Whitney engine, challenges were to(i) meet the delivery commitments in line with agreed schedule;(ii) fix in-service maturity issues in line with Airbus and customer
expectations.
In 2017, a total of 181 A320neo Family aircraft were delivered.
Supplier Pratt & Whitney introduced new engine fixes in the
fourth quarter which were certified. Unfortunately a new issue
arose likely unrelated to the prior fixes, the impact of which
was under assessment with respect to 2018 deliveries. Engine
supplier CFM International meanwhile experienced somematurity issues in 2017 on some batches of the LEAP-1A engine.
The A320neo ramp-up remained challenging and required thatthe engine suppliers deliver in line with commitments.
In 2018, A320neo Family deliveries increased to 386 aircraft
and represented over 60% of overall A320 Family deliveries
during 2018. The first long-range A321LR was delivered in
the fourth quarter. Deliveries of the Airbus Cabin Flex versionof the A321 are expected to increase in 2019 although the
ramp-up will remain challenging. Further upgrades of the Pratt& Whitney engine for the A320neo are due to arrive in 2019.
Airbus continues to monitor in-service engine performance.
Overall, the A320 programme is on track to reach the monthly
targeted production rate of 60 aircraft by mid-2019 with rate
63 targeted in 2021.
During the first three months 2019, a total of 96 A320neo Family
aircraft were delivered.
A330 programme. In 2016, the A330neo development was
ongoing.
In 2017, 67 A330 were delivered. On the A330neo, the first flight
was completed in October 2017. Two test aircraft were available.
The programme was on track to Type Certification.
In 2018, 49 A330 were delivered. On the A330neo programme,
the first A330-900s were delivered and the A330-800 conducted
its maiden flight in the final quarter of 2018. In 2019, A330neodeliveries are due to ramp-up. Airbus is working closely with its
A330neo engine partner to deliver on customer commitments.

During the first three months 2019, 5 A330 aircraft weredelivered including 3 NEOs. The flight test campaign of the
A330-800 variant is progressing.
A220 programme. As of 1 July 2018, the A220 aircraft
programme has been consolidated into Airbus. In 2018, theCompany delivered 20 A220s. The focus is on commercial
momentum, production ramp-up and cost reduction.
Generally, the Company makes estimates and provides, acrossthe programmes, for costs related to in-service technical issues
which have been identified and for which solutions have been
defined, which reflects the latest facts and circumstances. The
Company is contractually liable for the repair or replacementof the defective parts but not for any other damages whether
direct, indirect, incidental or consequential (including loss ofrevenue, profit or use). However, in view of overall commercial
relationships, contract adjustments may occur, and beconsidered on a case by case basis.

2

Restructuring provisions. In 2016, a net € 182 million provision
related to restructuring measures was booked by the Company.
A restructuring provision associated with the re-organisation of
the Company of € 160 million was recorded at year-end 2016,
following the communication of the plan to the employees and theEuropean Works Council in November 2016. The French social
plan was agreed between the Company and the works council
in June 2017. The German social plan was agreed between the
Company and the works councils in September 2017, and thereconciliation of interests were finalised on 21 February 2018.
In Airbus Helicopters, the restructuring plan launched in 2016
was signed by the three representative trade unions andvalidated by the Work Administration Agency (DIRECCTE) in
March 2017.
Defence export ban. Due to the prolonged suspension of
defence export licenses to Saudi Arabia by the German
Government, and the consequential inability of the Company to
execute a customer contract, a € 190 million impairment charge
has been recognised mainly on inventories and a € 107 million
financial expense related to hedge ineffectiveness as of
31 March 2019. The Company is engaging with its customer
to agree a way forward on this contract. The outcome of thesenegotiations is presently unclear but could result in significant
further financial risks.
Litigation. For information, see “— 1.1.7 Legal and Arbitration
Proceedings” and “Notes to the IFRS Consolidated Financial
Statements — Note 22: Provisions, Contingent Assets andContingent Liabilities”.
Brexit. In June 2018, the Company published its Brexit Risk
Assessment outlining its expectation regarding the material
consequences and risks for the Company arising from the
UK leaving the EU without a withdrawal agreement (“No deal
Brexit”). The Company has also launched a project to attempt
to mitigate against the major disruptions Brexit is likely to cause
to the Company’s business and production activities. To date,progress has been made in mitigating these risks. However,
because of the unprecedented nature of a No deal Brexit, thispotential scenario would plunge the aerospace industry into
unknown territory where, despite the actions the Company
is taking internally (including e.g., modifying Airbus’ customs
systems, stockpiling of parts associated with complementarytransportation and logistics means), the Company’s operations

Airbus / Registration Document 201875

Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.1 Operating and Financial Review

and supply chain may suffer from disruptions, the nature,materiality and duration of which is impossible to predict withany level of certainty. Hence the Company is complementing its
project with a crisis management plan to address and remediate
foreseeable post-Brexit issues if those were to materialise.

2.1.1.4

Current Trends

The Company expects the world economy and air traffic to growin line with prevailing independent forecasts, which assume no
major disruptions.
The Company’s 2019 earnings and Free Cash Flow guidanceis based on a constant perimeter, before M&A: Airbus targets
880 to 890 commercial aircraft deliveries in 2019. On that basis,
the Company expects to deliver an increase in EBIT Adjustedof approximately +15% compared to 2018 and Free Cash Flow
before M&A and Customer Financing of approximately € 4 billion.
This guidance has been prepared on the basis of certain
assumptions, including the principal assumptions as set out
below. The principal assumptions within the Company’s control
are as follows: (a) underlying commercial aircraft deliveries are
based on existing orders. Revenues from other activities arealso based on existing orders and may include estimates basedon relevant market forecasts; (b) no significant interruption
in operational performance or programme execution; (c) no
disruption in or change to the development of products orother development projects; and (d) no material change to theCompany’s existing capital structure.
The principal assumptions outside the Company’s control are
as follows: (a) no material change in general trading conditions,
economic conditions, competitive environment or levels of
demand which would materially affect the Company’s business;(b) the Company’s business operations do not suffer from external
disruptions or interruptions to operations; (c) suppliers will meettheir delivery commitments and ensure maturity, availability
and in-service performance; (d) no material change in theability or willingness of our customers to meet their contractual
obligations, including payment obligations to the Company;(e) no changes in the legislative or regulatory environment which
could have a material effect on the Company; and (f) no adverse
outcome to any material litigation or investigation.
The guidance has been prepared on a basis consistent with theaccounting policies adopted by the Company and is comparablewith the Company’s historical financial information.

2.1.2 Significant Accounting Considerations, Policies and Estimates
The Company’s significant accounting considerations,policies and estimates are described in the Notes to the
IFRS Consolidated Financial Statements. On 1 January 2018,
the Company has implemented the new standards IFRS 15“Revenue from Contracts with Customers” and IFRS 9“Financial Instruments”. As a result, the Company has changed
its accounting policies for revenue recognition and for theaccounting of financial instruments, please refer to the “Notes
to the IFRS Consolidated Financial Statements as of and for theyears ended 31 December 2018 and 2017 — Note 2: Significant
Accounting Policies” and “— Note 4: Change in Accounting
Policies and Disclosures”.
In addition, on 1 January 2019 the Company has implemented
the new standard IFRS 16 “Leases” and the new interpretation
IFRIC 23 “Uncertainty over Income tax treatment”. Pleaserefer to the “Notes to the Unaudited Condensed Interim IFRS
Consolidated Financial Information for the three-month period
ended 31 March 2019 and 2018 — Note 2: Accounting Policies”.

2.1.2.1

Scope of and Changes in Consolidation

For further information on the scope of and changes in
consolidation as well as acquisitions and disposals of interests
in business, please refer to the “Notes to the IFRS Consolidated
Financial Statements — Note 5: Scope of Consolidation” and“Note 6: Acquisitions and Disposals”.

2.1.2.2 Capitalised Development Costs
Pursuant to the application of IAS 38 “Intangible Assets”,
the Company assesses whether product-related development
costs qualify for capitalisation as internally generated intangible
assets. Criteria for capitalisation are strictly applied. All research76

Airbus / Registration Document 2018

and development costs not meeting the IAS 38 criteria are
expensed as incurred in the consolidated income statement.
Please refer to the “Notes to the IFRS Consolidated Financial
Statements — Note 2: Significant Accounting Policies— Research and development expenses” and “Note 17:
Intangible Assets”.

2.1.2.3 Accounting for Hedged Foreign
Exchange Transactions in the Financial
Statements
More than 75% of the Company’s revenues are denominatedin US dollars, whereas a substantial portion of its costs isincurred in euros and, to a smaller extent, in pounds sterling.
The Company uses hedging strategies to manage and minimise
the impact of exchange rate fluctuations on its profits, including
foreign exchange derivative contracts, interest rate and equity
swaps and other non-derivative financial assets or liabilities
denominated in a foreign currency.
For further information, see “— 2.1.7 Hedging Activities”, “Risk
Factors — 1. Financial Market Risks — Foreign Currency
Exposure” and please refer to the “Notes to the IFRS Consolidated
Financial Statements — Note 2: Significant Accounting Policies”
and “Note 35: Information about Financial Instruments”.

2.1.2.4

Foreign Currency Translation

For information on transactions in currencies other than thefunctional currency of the Company and translation differences
for other assets and liabilities of the Company denominatedin foreign currencies, please refer to the “Notes to the IFRS
Consolidated Financial Statements — Note 2: Significant
Accounting Policies — Transactions in Foreign Currency”.

REGISTRATION DOCUMENT 2018
Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.1 Operating and Financial Review

Currency Translation Mismatch
Customer advances (and the corresponding revenues recorded
when sales recognition occurs) are translated at the exchange
rate prevailing on the date they are received (historical rates
of customer advances). US dollar-denominated costs areconverted at the exchange rate prevailing on the date they are
incurred (historical rates of US dollar-denominated costs). To theextent those historical rates and the amounts received and paid
differ, there is a foreign currency exchange impact (mismatch)on EBIT. Additionally, the magnitude of any such difference, andthe corresponding impact on EBIT, is sensitive to variations in
the number of deliveries and spot rate (€/US$).

2.1.2.5 Accounting for Sales Financing
Transactions in the Financial Statements
The accounting treatment of sales financing transactions varies
based on the nature of the financing transaction and the resulting
exposure. Please refer to the “Notes to the IFRS Consolidated

Financial Statements — Note 19: Other Investments and Other
Long-Term Financial Assets”, “Note 22: Provisions, Contingent
Assets and Contingent Liabilities” and “Note 25: Sales Financing
Transactions”.
For further information on the significance of sales financing
transactions for the Company, see “— 2.1.6.4 Sales Financing”.

2.1.2.6

Provisions for Onerous Contracts

2

Provisions for onerous contracts are reviewed and reassessed
regularly. However, future changes in the assumptions usedby the Company or a change in the underlying circumstances
may lead to a revaluation of past provisions for onerous
contracts and have a corresponding positive or negative effecton the Company’s future financial performance. Please referto the “Notes to the IFRS Consolidated Financial Statements— Note 2: Significant Accounting Policies — Provisions for
Onerous Contracts” and “Note 22: Provisions, Contingent
Assets and Contingent Liabilities”.

2.1.3 Performance Measures
2.1.3.1

Business Segments

The following tables summarise the measures for the activities of the Company’s business segments for the past three years andfor the three-month period ended 31 March 2019 and 2018, when available.
Airbus(In € million)

Three-month Three-month
period ended period ended
31 March 2019 31 March 2018
(unaudited)(unaudited)

RevenueYear ended
31 December
2018Year ended
31 December 2017as restatedYear ended
31 December 2017as reported

Year ended
31 December 2016as reported

9,697

7,222

47,97043,48650,95849,237

EBIT

392

(2)

4,295

2,257

3,428

1,543

in % of revenue

4.0%(0.0%)

9.0%

5.2%

6.7%

3.1%

Three-month Three-month
period ended period ended
31 March 2019 31 March 2018
(unaudited)(unaudited)Year ended
31 December
2018Year ended
31 December 2017as restatedYear ended
31 December 2017as reported

Year ended
31 December 2016as reported

5,934

6,335

6,450

6,652

Airbus Helicopters(In € million)

Revenue

1,007

EBIT
in % of revenue

961

9

(10)

366

247

337

308

0.9%

(1.0%)

6.2%

3.9%

5.2%

4.6%

Three-month Three-month
period ended period ended
31 March 2019 31 March 2018
(unaudited)(unaudited)Year ended
31 December
2018Year ended
31 December 2017as restatedYear ended
31 December 2017as reported

Year ended
31 December 2016as reported

11,063

10,596

10,804

11,854

Airbus Defence and Space(In € million)

RevenueEBIT
in % of revenue

2,112

2,217

(117)

265

676

462

212

(93)

(5.5%)

12.0%

6.1%

4.4%

2.0%

(0.8%)

Airbus / Registration Document 201877

Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.1 Operating and Financial Review

2.1.3.2

Order Intake and Order Backlog

Year-end order backlog consists of contracts signed up tothat date. Only firm orders are included in calculating orderbacklog for commercial aircraft. A firm order is defined as one
for which the Company receives a down payment on a definitive
contract. Defence-related orders are included in the backlog
upon enforcement of the signed contract (and the receipt, inmost cases, of an advanced payment). Commitments under
defence “umbrella” or “framework” agreements by governmental
customers are not included in backlog until the Company isofficially notified.
Up until 1 January 2018, amounts of order backlog forcommercial aircraft contracts reflected in the table below arederived from catalogue prices, escalated to the expected
delivery date and, to the extent applicable, converted into euro
(at the corresponding hedge rate for the hedged portion of
expected cash flows, and at the period-end spot rate for the
non-hedged portion of expected cash flows). The amount ofdefence-related order backlog is equal to the contract valuesof the corresponding programmes. Order intake is measured
under IFRS 15 principles starting on 1 January 2018.

As of 31 December 2018, the total backlog and order intake
represent the aggregate amount of the net transaction priceallocated to the unsatisfied and partially unsatisfied performanceobligations to the Company’s customers. The 2018 order backlog
represents the contractual view. The value of the backlog ismeasured in accordance with the revenue recognition standard(IFRS 15) implemented from 1 January 2018 and reflects therecoverable amount of revenues under these contracts. As
a result, contractual rebates, engine concessions variableconsiderations and recoverability are taken into consideration
for measurement. Contracts stipulated in a currency different
than the presentation currency are translated to euro using the
spot rate as of 31 December 2018. Adjustments to the valueof the backlog could result from changes in the transaction
price. The backlog will mainly be released into revenue over a
period of seven years.
The significant reduction in order backlog value is mainly due
to the adjustment for net prices versus list prices. The 2018
order intake value is measured consistently with IFRS 15. Prior
year figures have not been restated for IFRS 15. 2017 and 2016
figures are based on catalogue prices for commercial aircraft
activities.

Order Intake(1)Year ended
31 December 2018
(In € billion) (In percentage)(2)Year ended
31 December 2017

Year ended
31 December 2016

(In € billion) (In percentage)(2)(In € billion) (In percentage)(2)

Airbus

41.5

73.7%

143.4

90.3%

114.9

84.3%

Airbus Helicopters

6.3

11.3%

6.5

4.1%

6.1

4.4%

Airbus Defence and Space

8.4

15.0%

8.9

5.6%

15.4

11.3%

Subtotal segmental order intake

56.3

100%

158.8

100%

136.4

100%

Transversal / Eliminations

(0.8)

(1.1)

(1.9)

Total

55.5

157.7

134.5

(1) Without options.
(2) Before “Transversal / Eliminations”.

Order Backlog(1)Year ended
31 December 2018
(In € billion) (In percentage)(2)

AirbusYear ended
31 December 2017

Year ended
31 December 2016

(In € billion) (In percentage)(2)

411.7

89.1%

950.4

Airbus Helicopters

14.9

3.2%

11.2

1.1%

11.3

1.1%

Airbus Defence and Space

35.3

7.7%

37.4

3.8%

41.5

3.9%

Subtotal segmental order backlog

461.9

100%

999.0

100%

1,063.0100%

Transversal / Eliminations

Total

95.1%

(In € billion) (In percentage)(2)

1,010.2

(2.4)

(2.1)

(2.6)

459.5

996.8

1,060.4

95.0%(1) Without options.
(2) Before “Transversal / Eliminations”.

First three months 2019. Airbus’ gross commercial aircraft
orders totaled 62 (first three months 2018: 68 aircraft) andincluded 38 A350 XWBs. Net commercial aircraft orders of-58 (first three months 2018: 45 aircraft) after 120 cancellations
mainly reflect the winding down of the A380 programme and78

Airbus / Registration Document 2018

the commercial agreement with Etihad. The commercial aircraft
backlog stood at 7,357 aircraft as of 31 March 2019. Airbus
Helicopters’ net orders of 66 units (first three months 2018:104 units) included 20 Super Puma Family and 16 H145s. Airbus
Defence and Space’s order intake by value totalled € 1.1 billion.

REGISTRATION DOCUMENT 2018
Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.1 Operating and Financial Review

2018 compared to 2017. Due to implementation of IFRS 15,
no comparison in terms of value is made between 2018 and2017. The decrease in the Company’s order backlog in terms ofvalue primarily reflects the change in measurement principles,
especially the use of contractual price versus catalogue price.
Airbus’ book-to-bill ratio amounted to 0.9 (calculated using
units of new net orders, i.e. new net orders in units divided bydeliveries in units). Order intake consisted of 747 net orders in2018 (as compared to 1,109 in 2017), driven mainly by the A320
Family, which received 541 net firm orders (531 A320neo and
10 A320ceo) and including 135 A220s. Total order backlog
at Airbus amounted to 7,577 aircraft at the end of 2018(as compared to 7,265 aircraft at the end of 2017). Airbus’
backlog includes Airbus Canada Limited Partnership (formerly
known as CSALP). This represents a record year-end level ofbacklog in units, showing the underlying health of the market.
Airbus Helicopters’ book-to-bill ratio was above 1 in termsof units. Airbus Helicopters received 381 net orders in 2018(as compared to 335 in 2017). Total order backlog amounted
to 717 helicopters at the end of 2018 (as compared to
692 helicopters at the end of 2017).
Airbus Defence and Space’s book-to-bill ratio amounts to ~0.8
with new net orders of € 8.4 billion, supported by key contract
wins including the Eurofighter contract with Qatar, 4 A330 MRTT
Tankers and 2 new generation telecommunication satellites.
2017 compared to 2016. The € -63.6 billion decrease in theorder backlog from 2016, to € 996.8 billion in 2017, primarilyreflects the weaker US dollar spot rate used for conversion of
the non-hedged portion of the backlog into euro at year-end(€/US$ 1.20 as compared to €/US$ 1.05 at the end of 2016)
which had a negative impact on order backlog of approximately€ -115 billion. Airbus’ strong order intake in 2017 (€ 158 billion

catalogue price) exceeded the reduction of the backlog from2017 deliveries.
Airbus’ backlog decreased by € -59.8 billion from 2016, to€ 950.4 billion in 2017, primarily reflecting the above mentioned
negative currency translation effects from the weaker US dollar
spot rate. A book-to-bill ratio of 1.5 (calculated using units of
new net orders, i.e. new net orders in units divided by deliveries
in units), however, contributed positively. Order intake consistedof 1,109 net orders in 2017 (as compared to 731 in 2016), driven
mainly by the A320 Family, which received 1,054 net firm orders(926 A320neo and 128 A320ceo). Total order backlog at Airbus
amounted to 7,265 aircraft at the end of 2017 (as comparedto 6,874 aircraft at the end of 2016). This represents a record
year-end level of backlog by units.

2

Airbus Helicopters’ backlog slightly decreased by € -0.1 billion
from 2016, to € 11.2 billion in 2017, reflecting a book-to-billratio, by value in euros, of around one with new net orders of€ 6.5 billion. Airbus Helicopters received 335 net orders in 2017(as compared to 353 in 2016). Total order backlog amounted
to 692 helicopters at the end of 2017 (as compared to 766
helicopters at the end of 2016).
Airbus Defence and Space’s backlog decreased by € -4.1 billion
from 2016 to € 37.4 billion in 2017, reflecting a book-to-bill ratioof less than one with new net orders of € 8.9 billion. Defence
and Space had a book-to-bill of ~0.8. Good momentum wasseen in military aircraft with the order intake including 22
light and medium transport aircraft, five A330 MRTT Tankers
and the Eurofighter contract with Kuwait. Two all-electric
telecommunication satellites were booked in the fourth quarter
despite a soft market environment. Airbus Defence and Space’s
perimeter changes had a negative impact of € 1.9 billion on theorder book and € 1.5 billion on order intake.

The following table illustrates the proportion of civil and defence backlog at the end of each of the past three years.
Year ended
31 December 2018Year ended
31 December 2017

(In € billion)(2) (In percentage)

Civil sector
Defence sector

Total

420.2

91%

Year ended
31 December 2016

(In € billion)(2) (In percentage)

959.9

96%

(In € billion)(2) (In percentage)

1,020.6

96%

39.3

9%

36.9

4%

39.8

4%

459.5

100%

996.8

100%

1,060.4

100%(1) Including “Transversal / Eliminations”.

Airbus / Registration Document 201879

Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.1 Operating and Financial Review

2.1.3.3

EBIT Adjusted

The Company uses an alternative performance measure EBIT Adjusted as a key indicator capturing the underlying businessmargin by excluding material charges or profits caused by movements in provisions related to programmes, restructurings orforeign exchange impacts as well as capital gains/losses from the disposal and acquisition of businesses.
The following table reconciles the Company’s EBIT with its EBIT Adjusted.
Three-month Three-month
period ended period ended
31 March 2019 31 March 2018
(unaudited)(unaudited)(In € million)

Year ended
31 December
2018Year ended
31 December
2017
as restated(1)Year ended
31 December
2017
as reported

Year ended
31 December
2016
as reported

EBIT

181

199

5,048

2,665

3,421

2,258

PDP mismatch / BS revaluation

83

(46)

(129)

7

7

930

A380 programme

61

0

463

0

0

0

A400M business update

0

0

436

992

1,299

2,210
385

A350 XWB business update

0

0

0

0

0

Compliance costs

22

5

123

117

117

0

Plant Holdings, Inc. gain

0

(159)

(159)

0

0

0

ArianeGroup creation phase 2

0

0

0

0

0

(1,175)

Defence Electronics
net capital gain

0

0

0

(604)

(604)

0

Dassault Aviation disposal

0

0

0

0

0

(868)

Portfolio in Airbus Defence
and Space and other M&A

0

8

(29)

13

13

33

0

7

8

0

0

182

Defence export ban

Restructuring / Transformation

190

0

0

0

0

0

Other costs

12

0

73

0

0

0

549

14

5,834

3,190

4,253

3,955

Three-month Three-month
period ended period ended
31 March 2019 31 March 2018
(unaudited)(unaudited)Year ended
31 December
2018Year ended
31 December
2017
as restatedYear ended
31 December
2017
as reported

Year ended
31 December
2016
as reported

(41)

4,808

2,383

3,554

2,811

EBIT Adjusted(1) Previous year figures are restated due to the application of IFRS 15.

2.1.3.4

EBIT Adjusted by Business Segment(In € million)

Airbus536

Airbus Helicopters

15

(3)

380

247

337

350

Airbus Defence and Space

101

112

935

815

872

1,002

Subtotal segmental
EBIT Adjusted

652

68

6,123

3,445

4,763

4,163

Transversal / Eliminations

(103)

(54)

(289)

(255)

(510)

(208)

Total

549

14

5,834

3,190

4,253

3,955

Three-month Three-month
period ended period ended
31 March 2019 31 March 2018
(unaudited)(unaudited)Year ended
31 December
2018Year ended
31 December
2017
as restatedYear ended
31 December
2017
as reported

Year ended
31 December
2016
as reported

2.1.3.5

EBIT by Business Segment(In € million)

AirbusAirbus Helicopters
Airbus Defence and Space

80

392

(2)

4,295

2,257

3,428

1,543

9

(10)

366

247

337

308

(117)

265

676

462

212

(93)

Subtotal segmental EBIT

284

253

5,337

2,966

3,977

1,758

Transversal / Eliminations

(103)

(54)

(289)

(301)

(556)

500

Total

181

199

5,048

2,665

3,421

2,258

Airbus / Registration Document 2018

REGISTRATION DOCUMENT 2018
Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.1 Operating and Financial Review

First three months 2019. Financials mainly reflect A320neo
ramp up and premium as well as further progress on the A350
financial performance at Airbus, partly offset by the impairment
charge as a consequence of the temporary suspension of export
licence at Airbus Defence and Space. In first three months
2018, it also included the impact of disposals, mainly the gainfrom the Plant Holdings, Inc. of € 159 million. The Company’s
consolidated EBIT decreased by 9%, from € 199 million for 2018
(restated) to € 181 million for the first three months 2019.
2018 compared to 2017. 2018 financials reflect strong
operational performance and programme execution, evidenced
in record deliveries at Airbus and higher revenues at Airbus
Defence and Space. The Company’s consolidated EBIT
increased by 89.4%, from € 2.7 billion for 2017 (restated) to€ 5.0 billion for 2018.
Airbus’ EBIT increased from € 2.3 billion for 2017 (restated)to € 4.3 billion for 2018 reflecting the strong operational
performance and record deliveries. A net charge of € 463 million
was recorded related to the A380 programme for the period
ended at 31 December 2018. Airbus’ EBIT in 2018 also included
a negative impact of € 123 million related to compliance costs.
Airbus Helicopters’ EBIT increased from € 247 million for 2017
(restated) to € 366 million for 2018, reflecting higher Super Puma
deliveries, a favourable mix and solid underlying programme
execution.
Airbus Defence and Space’s EBIT increased from € 462 million for2017 (restated) to € 676 million for 2018 reflecting continued solid
programme execution and contributions from its joint ventures
MBDA and ArianeGroup. In 2018, it also included the impact
of disposals, mainly the gain from the Plant Holdings, Inc. of€ 159 million. A net charge of € 436 million was recorded related
to the A400M programme for the period ended 31 December
2018 (2017 (restated): € 992 million).
2017 compared to 2016 (as reported). 2017 financials
reflect the perimeter changes in Airbus Defence and Spaceand Helicopters resulting in reduction in revenues of around€ 2 billion and related EBIT impact. The Company’s consolidated
EBIT increased by 51.5%, from € 2.3 billion for 2016 to € 3.4 billion
for 2017.
Airbus’ EBIT increased from € 1.5 billion for 2016 to € 3.4 billion
for 2017, reflecting the strong delivery performance supported
by improved foreign exchange rates. Good progress was madein reducing the A350 losses in line with expectations.
Airbus Helicopters’ EBIT increased from € 308 million for 2016
to € 337 million for 2017, reflecting transformation efforts whichhave globally supported the Division’s competitiveness in achallenging market and lower impact from past Super Puma
grounding. This was reduced by lower deliveries, an unfavourable
mix and lower commercial flight hours in services and perimeterchange, following the divestment of the maintenance, repair andoverhaul business Vector Aerospace in November.

Airbus Defence and Space’s EBIT increased from € -93 million
for 2016 to € 212 million for 2017, reflecting a stable corebusiness performance and solid contributions from the MBDA
and ArianeGroup joint ventures. It was supported by the net
capital gain of € 604 million from the divestment of the defence
electronics business and some further small disposal impacts.
A net charge of € 1,299 million was recorded related to the
A400M programme for the period ended 31 December 2017(€ 2,210 million for the period ended 31 December 2016). Airbus
Defence and Space’s EBIT in 2017 also included a negative
impact of € 91 million related to compliance, comprising an
administrative penalty notice connected to the terminationof the Eurofighter Austria investigation by the Munich Public
Prosecutor. See “— 2.1.1.3 Significant Programme Developments,
Restructuring and Related Financial Consequences in 2016,2017 and 2018”.

2

Foreign currency impact on EBIT. More than 75% of
the Company’s revenues are denominated in US dollars, whereasa substantial portion of its costs is incurred in euros and, toa lesser extent, pounds sterling. Given the long-term natureof its business cycles (evidenced by its multi-year backlog),
the Company hedges a significant portion of its net foreignexchange exposure to mitigate the impact of exchange rate
fluctuations on its EBIT. Please refer to the “Notes to the IFRS
Consolidated Financial Statements — Note 35: Information about
Financial Instruments” and see “— Risk Factors — 1. Financial
Market Risks — Foreign Currency Exposure”. In addition to theimpact that hedging activities have on the Company’s EBIT, thelatter is also affected by the impact of revaluation of certain
assets and liabilities at the closing rate and the impact of natural
hedging.
During the first three months 2019, cash flow hedges covering
approximately US$ 6.3 billion of the Company’s US dollardenominated revenues matured. The compounded exchange
rate at which hedged US dollar-denominated revenues were
accounted for was €/US$ 1.32, as compared to €/US$ 1.31 in
the first three months 2018.
During 2018, cash flow hedges covering approximately
US$ 25.4 billion of the Company’s US dollar-denominatedrevenues matured. In 2018, the compounded exchange rate at
which hedged US dollar-denominated revenues were accounted
for was €/US$ 1.24, as compared to €/US$ 1.29 in 2017. See“— 2.1.2.4 Foreign Currency Translation”.
During 2017, cash flow hedges covering approximately
US$ 25.3 billion of the Company’s US dollar-denominatedrevenues matured. In 2017, the compounded exchange rate at
which hedged US dollar-denominated revenues were accounted
for was €/US$ 1.29, as compared to €/US$ 1.32 in 2016. See“— 2.1.2.4 Foreign Currency Translation”.

Airbus / Registration Document 201881

Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.1 Operating and Financial Review

2.1.4 Results of Operations
The following table summarises the IFRS Company’s Consolidated Income Statements for the past three years and for the threemonth period ended 31 March 2019 and 2018:(In € million)

Three-month Three-month
period ended period ended
31 March 2019 31 March 2018
(unaudited)(unaudited)Year ended
31 December
2018Year ended
31 December
2017
as restated(1)Year ended
31 December
2017
as reported

Year ended
31 December
2016
as reported

Revenue

12,549

10,11963,70759,022

66,767

66,581

Cost of sales(11,169)(9,045)(54,920)(52,149)(59,160)(61,317)Gross margin

1,380

1,074

8,787

6,873

7,607

5,264

Selling and administrative
expenses

(584)

(542)

(2,435)(2,439)(2,439)(2,723)

Research and development
expenses

(654)

(616)

(3,217)(2,807)(2,807)(2,970)

Other income

70

256

1,656

981

981

2,689

Other expenses

(21)

(9)

(182)

(336)

(336)

(254)

Share of profit from investments
accounted for under the equity
method and other income frominvestments

(10)

36

439

393

415

252

Profit before finance costs
and income taxes

181

199

5,048

2,665

3,421

2,258

Interest result

(36)

(63)

(232)

(328)

(328)

(275)

Other financial result

(7)

102

(531)

1,489

1,477

(692)

Income taxes

(94)

46

(1,274)(1,462)(1,693)(291)

Profit for the period

44

284

3,011

2,364

2,877

1,000

Equity owners of the parent(Net income)

40

283

3,054

2,361

2,873

995

Non-controlling interests

4

1

(43)

3

4

5

Earnings per share

€

€

€

€

€

€

Basic

0.05

0.37

3.94

3.05

3.71

1.29

Diluted

0.05

0.37

3.92

3.04

3.70

1.29

Attributable to:(1) Previous year figures are restated due to the application of IFRS 15.

82

Airbus / Registration Document 2018

REGISTRATION DOCUMENT 2018
Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.1 Operating and Financial Review

2.1.4.1

Revenues

The following table presents a breakdown of the Company’s revenues by business segment for the past three years and theUnaudited Condensed Interim IFRS Consolidated Financial Information for the three months ended 31 March 2019 and the threemonths ended 31 March 2018:
Three-month Three-month
period ended period ended
31 March 2019 31 March 2018
(unaudited)(unaudited)(In € million)

Year ended
31 December
2018Year ended
31 December
2017
as restatedYear ended
31 December
2017
as reported

Year ended
31 December
2016
as reported

Airbus

9,697

7,222

47,97043,48650,95849,237

Airbus Helicopters

1,007

961

5,934

6,335

6,450

6,652

Airbus Defence and Space
Subtotal segmental revenue
Transversal / Eliminations

Total

2,112

2,217

11,063

10,596

10,804

11,854

12,816

10,40064,96760,417

68,212

67,743

(267)

(281)

(1,260)(1,395)(1,445)(1,162)

12,549

10,11963,70759,022

66,767

66,581For the first three months 2019, revenue increased by 24%
to € +12.5 billion (first three months 2018: € 10,119 million),
mainly reflecting the higher commercial aircraft deliveries as
the production ramp-up continued.
For 2018, revenues increased by 7.9%, from € 59.0 billion for 2017
(restated) to € 63.7 billion for 2018, reflecting record commercial
aircraft deliveries at Airbus, and supported by Space Systems

2and Military Aircraft activities at Airbus Defence and Space,partly offset by the perimeter change in Airbus Helicopters.
For 2017 (as reported), revenues were stable at € 66.8 billion,
a 0.3% increase from € 66.6 billion in 2016, as higher aircraft
deliveries at Airbus were offset by the portfolio reshaping in
Airbus Defence and Space and in Airbus Helicopters resulting
in reduction of revenues of around € 2 billion.

Airbus
The following table presents a breakdown of deliveries of commercial aircraft by product type:(In units)

A220
A320 Family

Three-month
period ended
31 March 2019
(unaudited)Three-month
period ended
31 March 2018
(unaudited)Year ended
31 December 2018Year ended
31 December 2017

Year ended
31 December 2016

8

-

20

-

-

126

95

626

558

545

A330

5

8

49

67

66

A350 XWB

22

17

93

78

49

A380

1

1

12

15

28

Total

162

121

800

718

688

Airbus’ revenues increased by 34.3%, from € 7.2 billion for
the first three months 2018 to € 9.7 billion for the first threemonths 2019. The increase was mainly driven by higher aircraft
deliveries.
Airbus’ revenues increased by 10.3%, from € 43.5 billion for2017 (restated) to € 48.0 billion for 2018. This was due to recorddeliveries of 800 aircraft (compared to 718 deliveries in 2017)

including 93 A350 XWBs and 20 A220s supported by solid
operational performance.
For 2017 (as reported), Airbus’ revenues increased by 3.5%,
from € 49.2 billion for 2016 to € 51.0 billion for 2017. This was due
to record deliveries of 718 aircraft (compared to 688 deliveriesin 2016) including 78 A350 XWBs and a favourable foreignexchange impact.

Airbus Helicopters
The following table presents a breakdown of deliveries of helicopters by product type:Three-month
period ended
31 March 2019
(unaudited)Three-month
period ended
31 March 2018
(unaudited)Year ended
31 December 2018Year ended
31 December 2017

Year ended
31 December 2016

Light

23

23

156

166

177

Medium

20

20

137

178

165

Heavy

2

6

54

48

57

2

5

36

40

38

Tiger

1

3

9

17

19

Total

46

52

356

409

418

(In units)

thereof NH90

Airbus / Registration Document 201883

Management’s Discussion and Analysis of Financial Condition and Results of Operations /Airbus Helicopters’ revenues remained stable at € 1.0 billion for
the first three months 2019 and 2018, reflecting higher volume
in services and lower deliveries.
Airbus Helicopters’ revenues decreased by 6.3%, from€ 6.3 billion for 2017 (restated) to € 5.9 billion in 2018. Revenues
on a comparable perimeter are stable, despite lower deliveriesof 356 units. The perimeter reduction following the disposalof Vector Aerospace had a negative impact of approximately€ 0.5 billion.

For 2017 (as reported), Airbus Helicopters’ revenues decreasedby 3.0%, from € 6.7 billion for 2016 to € 6.5 billion in 2017,reflecting lower deliveries of 409 units and lower commercial
flight hours in services impacted by Super Puma grounding.
The number of Heavy helicopters delivered continued todecrease in 2017, reflecting the soft Civil & Parapublic market,
particularly in Oil & Gas. The disposal of Vector Aerospace
had a negative perimeter change impact of around € 0.1 billion.

Airbus Defence and Space
The following table presents a breakdown of deliveries of Airbus Defence and Space by product type:Three-month
period ended
31 March 2019
(unaudited)(In units)

Three-month
period ended
31 March 2018
(unaudited)Year ended
31 December 2018Year ended
31 December 2017

Year ended
31 December 2016

A400M

1

4

17

19

17

A330 MRTT (Tanker)

0

0

6

1

2

Light & Medium aircraft

1

1

6

7

14

Telecom satellites

0

1

2

4

1

Total

2

6

31

31

34

Airbus Defence and Space’s revenues decreased by 4.7% from€ 2.2 billion for the first three months 2018 to € 2.1 billion for the
first three months 2019, reflecting the overall stable businessperformance.
Airbus Defence and Space’s revenues increased by 4.4%
from € 10.6 billion for 2017 (restated) to € 11.1 billion in 2018,
supported by Space Systems and Military Aircraft activities.
For 2017 (as reported), Airbus Defence and Space’s revenues
decreased by 8.9% from € 11.9 billion for 2016 to € 10.8 billion
in 2017, reflecting the Division’s perimeter changes of around€ 1.7 billion but were 7% higher on a comparable basis driven
mainly by military aircraft. The lower number of Light & Medium
aircraft delivered in 2017 is a function of lower order intake inrecent years.

2.1.4.2

Cost of Sales

Cost of sales increased from € 9.0 billion for the first threemonths 2018 to € 11.2 billion for the first three months 2019.
Cost of sales increased by 5.3% from € 52.1 billion for 2017
(restated) to € 54.9 billion for 2018. The increase was principally
due to impairments and provisions recognised on the A380
programme of € 1,257 million. It also included a positive impact
from a lower net charge related to the A400M programme in theamount of € 436 million (2017 (restated): € 992 million) at Airbus
Defence and Space.
For 2017 (as reported), cost of sales decreased by 3.5% from€ 61.3 billion for 2016 to € 59.2 billion for 2017. The decrease
was primarily due to a lower net charge related to the A400M
programme in the amount of € 1,299 million (2016: € 2,210 million)
and the perimeter changes at Airbus Defence and Space. In
2016 a charge of € 385 million was booked for the A350 XWB
programme (2017: € 0 million).

84

Airbus / Registration Document 2018

2.1.4.3

Selling and Administrative Expenses

For the first three months 2019, selling and administrative
expenses remained stable at € 0.6 billion versus the first threemonths 2018 at € 0.5 billion.
For 2018, selling and administrative expenses remained stableversus 2017 at € 2.4 billion.
For 2017, selling and administrative expenses decreased by
10.4%, from € 2.7 billion for 2016 to € 2.4 billion for 2017.

2.1.4.4

Research and Development Expenses

For the first three months 2019, research and development
expenses slightly increased to € 0.7 billion compared to€ 0.6 billion in the first three months 2018. In addition, an amountof € 27 million of development costs has been capitalised, mainly
related to Airbus Defence and Space programmes.
Research and development expenses increased by 14.6%, from€ 2.8 billion for 2017 to € 3.2 billion for 2018, mainly reflecting
development cost on the A320neo. In addition, an amount of€ 91 million of development costs has been capitalised, mainly
related to Airbus Helicopters programmes. See “— 2.1.2.2
Capitalised Development Costs”.
For 2017, research and development expenses decreased by
5.5%, from € 3.0 billion for 2016 to € 2.8 billion for 2017 primarilyreflecting a reduction of R&D activities on the A350 XWB
programme at Airbus. In addition, an amount of € 219 million
of development costs has been capitalised, mainly related to
the A330neo and H160 programmes.

2.1.4.5

Other Income and Other Expenses

Other income and other expenses typically include gains andlosses on disposals of investments, of fixed assets and income
from rental properties.

REGISTRATION DOCUMENT 2018
Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.1 Operating and Financial Review

For the first three months 2019, other income and otherexpenses was € 49 million net as compared to € 247 million
net for the first three months 2018, which included the gain of€ 159 million following the disposal of Plant Holdings, Inc.
For 2018, other income and other expenses was € 1,474 million
net as compared to € 645 million net for 2017. In 2018, theincrease is mainly related to the release of liabilities on the A380
programme and the gain of € 159 million following the disposalof Plant Holdings, Inc.
For 2017, other income and other expenses was € +645 million
net as compared to € +2,435 million net for 2016. In 2017, it
mainly includes the capital gain of € 604 million from the disposalof the defence electronics business.

2.1.4.6

Share of Profit from Investments
Accounted for under the Equity Method
and Other Income from Investments

Share of profit from investments accounted for under the equity
method and other income from investments principally include
results from companies accounted for under the equity method
and the dividends attributable to unconsolidated investments.
For the first three months 2019, the Company recorded€ -10 million in share of profit from investments accounted forunder the equity method and other income from investments
as compared to € 36 million for the first three months 2018.
For 2018, the Company recorded € 439 million in share of profit
from investments accounted for under the equity method andother income from investments as compared to € 393 million
for 2017 (restated). Please refer to the “Notes to the IFRS
Consolidated Financial Statements — Note 7: Investments
Accounted for under the Equity Method” and “Note 12: Share ofProfit from Investments Accounted for under the Equity Method
and Other Income from Investments”.
For 2017 (as reported), the Company recorded € 415 million inshare of profit from investments accounted for under the equity
method and other income from investments as compared to€ 252 million for 2016.

2.1.4.7

Interest Result

Interest result reflects the net of interest income and expense
arising from financial assets and liabilities, including interest
expense on refundable advances provided by European
Governments to finance R&D activities. Please refer to the “Notes
to the IFRS Consolidated Financial Statements — Note 14: Total
Financial Result”.
For the first three months 2019, the Company recorded a net
interest expense of € -36 million, as compared to € -63 million
for the first three months 2018.
For 2018, the Company recorded a net interest expense of€ -232 million, as compared to € -328 million for 2017. The
decrease in net interest expense was principally due to lower
interest expense related to the European Governments’refundable advances.
For 2017, the Company recorded a net interest expense of€ -328 million, as compared to € -275 million for 2016. The
difference is primarily due to lower interest expense recordedon European Governments’ refundable advances in 2016.

2.1.4.8

Other Financial Result

Other financial result includes the impact from the revaluationof financial instruments, the effect of foreign exchange valuationof monetary items and the unwinding of discounted provisions.
Please refer to the “Notes to the IFRS Consolidated Financial
Statements — Note 2: Significant Accounting Policies” and“Note 14: Total Financial Result”.
Other financial result decreased from € 102 million for the first
three months 2018 to € -7 million for the first three months 2019,
mainly due to the financial expense on hedge ineffectiveness.

2

Other financial result decreased from € 1,489 million for 2017
(restated) to € -531 million for 2018. This is due to a negative
impact from the revaluation of financial instruments of€ -732 million and foreign exchange valuation of monetary items,
partly compensated by the net effect of the change of treatmentof certain financial instruments under IFRS 9. In addition, in 2017
it included the impact of the refundable advances release. Pleaserefer to the “Notes to the IFRS Consolidated Financial Statements— Note 23: Other Financial Assets and Other Financial Liabilities”.
For 2017 (as reported), other financial result increased from€ -692 million for 2016 to € 1,477 million for 2017. This is mainly
related to a positive impact from both foreign exchange valuationof monetary items of € +439 million and the revaluation offinancial instruments of € +743 million. In addition, it included
the impact of the decrease in the European Governments’refundable advances primarily related to the A380 programme.

2.1.4.9

Income Tax

For the first three months 2019, income tax was € -94 million
as compared to € 46 million for the first three months 2018 andcorresponds to an effective tax rate of 68.1% (first three months
2018: -19.3%). This includes a deferred tax asset impairment,
partially offset by the tax-free revaluation of certain equity
investments under IFRS 9.
For 2018, income tax expense was € -1,274 million as comparedto € -1,462 million for 2017 (restated). The decrease, despite
the higher income before tax recorded in 2018 (€ 4,285 million)
as compared to 2017 (€ 3,826 million (restated)), is mainly
driven by a lesser volume of deferred tax asset impairment
than in 2017. The effective tax rate was 30% in 2018, mainly
impacted by non‑realised tax losses in the period leading to
additional deferred tax asset impairment. This was partially
offset by the tax-free sale of Plant Holdings Inc. Without these
impacts, the effective tax rate would be approximately 26%.
Please refer to the “Notes to the IFRS Consolidated Financial
Statements — Note 15: Income Tax”.
For 2017 (as reported), income tax expense was € -1,693 million
as compared to € -291 million for 2016. The increase wasprimarily due to the higher income before tax recorded in 2017(€ 4,570 million) as compared to 2016 (€ 1,291 million). The
effective tax rate was 37% in 2017. It was mainly impacted
by non-realised tax losses in the period leading to additional
deferred tax asset impairment. It also included an additional
income tax charge related to the French corporate tax surcharge
and the reduction in deferred tax asset due to the income tax rate
decrease in the US, both enacted end of 2017. This was partially
offset by the disposal of the defence electronics business, which
is taxed at a reduced rate. Without these impacts, the effective
tax rate would be approximately 26%.

Airbus / Registration Document 201885

Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.1 Operating and Financial Review

2.1.4.10 Non-Controlling Interests
For the first three months 2019, profit for the period attributable
to non-controlling interests was € 4 million, as compared to€ 1 million for the first three months 2018.
For 2018, profit for the period attributable to non-controllinginterests was € -43 million, as compared to € 3 million for 2017
(restated).

2.1.4.11 Profit for the Period Attributable
to Equity Owners of the Parent(Net Income)Net income for the first three months 2019 was € 40 million,
as compared to net income of € 283 million for the first threemonths 2018.
Three-monthThree-month
period ended
period ended
31 March 2019 31 March 2018
(unaudited)(unaudited)

As a result of the factors discussed above, the Company
recorded net income of € 3,054 million for 2018, as comparedto € 2,361 million for 2017 (restated).

2.1.4.12 Earnings per Share
Basic earnings were € 3.94 per share in 2018, as comparedto € 3.05 per share in 2017 (restated) (first three months 2019:€ 0.05). The number of issued shares as of 31 December 2018 was
776,367,881 (31 March 2019: no change). The denominator used
to calculate earnings per share was 775,167,941 shares (2017:773,772,702) (first three months 2019: 775,730,957), reflecting
the weighted average number of shares outstanding during theyear. In 2016, the Company reported basic earnings of € 1.29
per share, based on a denominator of 773,798,837 shares.

Year ended
31 December
2018Year ended
31 December
2017 asrestated(1)Year ended
31 December
2017
as reported

Year ended
31 December
2016
as reported

Profit for the period
attributable to equity ownersof the parent (Net income)€ 40 million€ 283 million€ 3,054 million€ 2,361 million€ 2,873 million€ 995 million

Weighted average numberof ordinary shares

775,730,957

774,364,786

775,167,941

773,772,702

773,772,702

773,798,837€ 0.05€ 0.37€ 3.94€ 3.05€ 3.71€ 1.29Basic earnings per share(1) Previous year figures are restated due to the application of IFRS 15.

Diluted earnings were € 3.92 per share in 2018, as comparedto € 3.04 per share in 2017 (first three months 2019: € 0.05).
The denominator used to calculate diluted earnings per share
was 780,943,038 (2017: 779,301,228) (first three months 2019:781,606,263), reflecting the weighted average number of shares
Three-monthThree-month
period ended
period ended
31 March 2019 31 March 2018
(unaudited)(unaudited)
Profit for the period
attributable to equity ownersof the parent (Net income),
adjusted for diluted calculation
Weighted average numberof ordinary shares (diluted)

Diluted earnings per shareoutstanding during the year, adjusted to assume the conversionof all potential ordinary shares. In 2016, the Company reported
diluted earnings of € 1.29 per share, based on a denominatorof 779,104,634 shares.

Year ended
31 December
2018Year ended
31 December
2017 asrestated(1)Year ended
31 December
2017 asreported

Year ended
31 December
2016 asreported€ 42 million€ 285 million€ 3,061 million€ 2,368 million€ 2,880 million€ 1,002 million

781,606,263

780,059,523

780,943,038

779,301,228

779,301,228

779,109,634€ 0.05€ 0.37€ 3.92€ 3.04€ 3.70€ 1.29(1) Previous year figures are restated due to the application of IFRS 15.

For further information, please refer to the “Notes to the IFRS Consolidated Financial Statements — Note 16: Earnings per Share”
and “Note 32: Total Equity”.

86

Airbus / Registration Document 2018

REGISTRATION DOCUMENT 2018
Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.1 Operating and Financial Review

2.1.5 Changes in Total Equity (Including Non-Controlling Interests)
The following table sets forth a summary of the changes in total equity for the period 1 January 2018 through 31 December 2018.
(In € million)

Balance at 31 December 2017, restated(1)Restatements

10,742(8)(1)(2)

10,734

Balance at 1 January 2018, restated(1)(2)
Profit for the period

3,011

Other comprehensive income(3,014)

thereof foreign currency translation adjustments

100

Capital increase

117

Cash distribution to shareholders / Dividends paid to non-controlling interests(1,161)Equity transactions (IAS 27)

19

Share-based payment (IFRS 2)

62

Change in treasury shares

Balance at 31 December 2018

(49)

9,719

Restatements(3)(122)

Balance at 1 January 2019, restated(3)9,597Profit for the period
Other comprehensive income

2

44
(733)

thereof foreign currency translation adjustments

59

Equity transactions (IAS 27)(28)

Share-based payment (IFRS 2)

33

Balance at 31 March 2019

8,913

(1) Previous year figures are restated due to the application of IFRS 15.
(2) Opening balance figures are restated due to the application of IFRS 9.
(3) Opening balance figures are restated due to the application of IFRIC 23.

Please refer to the “Airbus SE IFRS Consolidated Financial
Statements — IFRS Consolidated Statements of Changes in
Equity for the years ended 31 December 2018 and 2017” andto the “Notes to the IFRS Consolidated Financial Statements— Note 32: Total Equity”.

2.1.5.1

Cash Flow Hedge Related Impact
on AOCI

As of 31 December 2018, the notional amount of the Company’s
portfolio of outstanding cash flow hedges amounted to
US$ 81.9 billion (31 March 2019: US$ 81.8 billion), hedged
against the euro and the pound sterling. The year-end mark tomarket valuation of this portfolio required under IFRS 9 (2017under IAS 39) resulted in a negative pre-tax AOCI valuation
change of € -3.0 billion as of 31 December 2018 compared to
31 December 2017 (change of -0.7 billion as of 31 March 2019
compared to 31 December 2018), based on a closing rate of€/‌US$ 1.15 (31 March 2019: €/US$ 1.12) as compared to a pre‑tax
AOCI valuation change of € 10.6 billion as of 31 December 2017
compared to 31 December 2016, based on a closing rate of€/‌US$ 1.20. For further information on the measurement of thefair values of financial instruments, please refer to the “Notes
to the IFRS Consolidated Financial Statements — Note 35:
Information about Financial Instruments”.
Positive pre-tax mark to market values of cash flow hedges areincluded in other financial assets, while negative pre-tax mark tomarket values of cash flow hedges are included in other financial
liabilities. Year-to-year changes in the mark to market value ofeffective cash flow hedges are recognised as adjustments to
AOCI. These adjustments to AOCI are net of corresponding
changes to deferred tax assets (for cash flow hedges withnegative mark to market valuations) and deferred tax liabilities(for cash flow hedges with positive mark to market valuations).

Airbus / Registration Document 201887

Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.1 Operating and Financial Review

The following graphic presents the cash flow hedge related movements in AOCI over the past three years. The mark to market ofthe backlog is not reflected in the accounts whereas the mark to market of the hedge book is reflected in AOCI.
CASH FLOW HEDGE RELATED MOVEMENTS IN AOCI IN € MILLION (BASED ON YEAR-END EXCHANGE RATES)OCI Net Asset-9,810836-1,918Net Deferred

2,616
-238
445

Net Equity OCI-7,194598-1,47331 December 2016: US$ 1.05

31 December 2017: US$ 1.20

31 December 2018: US$ 1.15

As a result of the negative change in the fair market valuation of the cash flow hedge portfolio in 2018, AOCI amounted to a net
liability of € -1.9 billion for 2018, as compared to a net asset of € +0.8 billion for 2017. The corresponding € +0.7 billion tax effectled to a net deferred tax asset of € 0.4 billion as of 31 December 2018 as compared to a net deferred tax liability of € -0.2 billion
as of 31 December 2017.
For further information, please refer to the “Notes to the IFRS Consolidated Financial Statements — Note 35.5: Information about
Financial Instruments — Derivative Financial Instruments and Hedge Accounting Disclosure”.

2.1.5.2

Foreign Currency Translation Adjustment Impact on AOCIThe € 99 million currency translation adjustment related impact on AOCI in 2018 (first three months 2019: € 59 million) mainlyreflects the effect of the variations of the US dollar and the pound sterling.

2.1.6 Liquidity and Capital Resources
The Company’s objective is to generate sufficient operating
cash flow in order to invest in its growth and future expansion,
honour the Company’s dividend policy and maintain financial
flexibility while retaining its credit rating and competitive accessto capital markets.
The Company defines its consolidated net cash position as thesum of (i) cash and cash equivalents and (ii) securities, minus(iii) financing liabilities (all as recorded in the Consolidated
Statements of Financial Position). Net cash position is analternative performance measure and an indicator that allows
the Company to measure its ability to generate sufficient liquidity
to invest in its growth and future expansion, honour its dividend
policy and maintain financial flexibility. The net cash position
as of 31 December 2018 was € 13.3 billion (€ 13.4 billion as of
31 December 2017) (31 March 2019: € 7.5 billion).

88

Airbus / Registration Document 2018

The liquidity is further supported by a € 3.0 billion syndicatedback-up facility, undrawn as of 31 December 2018 with nofinancial covenants, as well as a Euro Medium Term Note
programme and commercial paper programme. See “— 2.1.6.3
Consolidated Financing Liabilities” and please refer to the “Notes
to the IFRS Consolidated Financial Statements — Note 34.3: Net
cash – Financial Liabilities” and “Notes to the IFRS Consolidated
Financial Statements — Note 35.1: Information about Financial
Instruments — Financial Risk Management”. The factors
affecting the Company’s cash position, and consequently its
liquidity risk, are discussed below.
For information on Airbus SE’s credit ratings, please refer tothe “Notes to the IFRS Consolidated Financial Statements— Note 33: Capital Management” and see “— 2.1.6.1: Cash
Flows”.

REGISTRATION DOCUMENT 2018
Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.1 Operating and Financial Review

2.1.6.1

Cash Flows

The Company generally finances its manufacturing activities and product development programmes, and in particular thedevelopment of new commercial aircraft, through a combination of flows generated by operating activities, customer advances,risk-sharing partnerships with subcontractors and European Governments’ refundable advances. In addition, the Company’s
military activities benefit from government-financed research and development contracts. If necessary, the Company may raise
funds in the capital markets.
The following table sets forth the variation of the Company’s consolidated net cash position over the periods indicated.
(In € million)

31 March 2019 31 March 2018
(unaudited)(unaudited)

2017

2016

13,391

11,113

10,003

Net Cash position at 1 January

13,281First time impact of IFRS 16(1,352)

0

0

0

0

725

206

5,515

4,451

3,565

(4,703)(3,797)

(633)

266

346

(52)

(7)

79

(100)

(252)

Gross cash flow from operations(1)Changes in other operating assets and liabilities(working capital)(2)thereof customer financing
Cash used for investing activities(3)thereof industrial capital expenditures
Free Cash Flow(4)thereof M&A transactions
Free Cash Flow before M&A(5)Cash flow from customer financing (net)13,391

2018

(470)

(65)

(1,377)

(982)

(730)

(455)

(393)

(2,285)(2,558)(3,060)(4,448)(3,656)

3,505

3,735

3,181

(55)

190

514

886

2,025

(4,393)(3,846)

2,991

2,849

1,156

(52)

(7)

79

(100)

(252)

Free Cash Flow before customer financing(4,396)(3,649)

3,426

3,835

3,433

Free Cash Flow before M&A and customer financing(4,341)(3,839)

2,912

2,949

1,408

Cash distribution to shareholders / non-controlling interests00(1,161)(1,046)(1,012)Contribution to plan assets of pension schemes

(42)

(53)

(2,519)

(458)

(290)

Changes in capital and non-controlling interests

0

0

117

83

60

Change in treasury shares / share buyback

0

(37)

(49)

0

(736)

Others

24

125

(3)

(36)

(93)

7,463

9,770

13,281

13,391

11,113

Net Cash position at 31 December

2(1) Represents cash used for operating activities, excluding (i) changes in other operating assets and liabilities (working capital), (ii) contribution to plan assets of pension schemesand (iii) realised foreign exchange results on treasury swaps (€ -45 million in 2018, € 185 million in 2017, € -151 million in 2016) (31 March 2019: € -30 million). It is an alternative
performance measure and an indicator used to measure its operating cash performance before changes in working capital.
(2) Excluding reclassification of certain trade liabilities.
(3) Does not reflect change in securities (net investment of € -93 million in 2018, net investment of € -1,233 million in 2017, net investment of € 337 million in 2016) (31 March 2019: net
disposal of € +459 million), which are classified as cash and not as investments solely for the purposes of this net cash presentation. Excluding bank activities.
(4) Does not reflect change of securities, change in cash from changes in consolidation, contribution to plan assets of pension schemes and realised foreign exchange results ontreasury swaps. Excluding bank activities. Free Cash Flow is an alternative performance measure and indicator that reflects the amount of cash flow generated from operations
after cash used in investing activities.
(5) Free Cash Flow before M&A refers to Free Cash Flow adjusted for net proceeds from disposals and acquisitions. It is an alternative performance measure and indicator that reflects
Free Cash Flow excluding those cash flows from the disposal and acquisition of businesses.

The net cash position as of 31 December 2018 was stableat € 13.3 billion, a 0.8% decrease from 31 December 2017(31 March 2019: € 7.5 billion). The increase in gross cash flowfrom operations (€ 5.5 billion) (31 March 2019: € 0.7 billion), wasoffset by the contributions to plan assets of pensions schemes(€ -2.5 billion) (31 March 2019: € 42 million), the cash used forinvesting activities (€ -1.4 billion) (31 March 2019: € 0.5 billion) andthe cash distribution to shareholders / non-controlling interests(€ -1.2 billion).
Gross Cash Flow from Operations
Gross cash flow from operations is an alternative performancemeasure and an indicator used by the Company to measure its
operating cash performance before changes in working capital.

Gross cash flow from operations increased to € 5.5 billion for2018 (first three months 2019: € 0.7 billion), which reflects thestrong EBIT Adjusted.
Changes in Other Operating Assets and Liabilities
Changes in other operating assets and liabilities is comprisedof inventories, trade receivables, contract assets and contract
liabilities (including customer advances), trade liabilities, andother assets and other liabilities. They resulted in a negative
working capital variation of € -0.6 billion for 2018, versus a
positive impact of € +0.3 billion for 2017 (first three months
2019: € -4.7 billion).

Airbus / Registration Document 201889

Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.1 Operating and Financial Review

In 2018, the contributors to the negative working capital variation
were the change in trade receivables (€ -0.9 billion), the change inother assets and liabilities (€ -0.7 billion), the change in contract
assets and contract liabilities (€ -0.7 billion), and the change ininventories (€ -0.7 billion). This was partially compensated by
the increase in trade liabilities (€ 2.3 billion) due to favourable
payment terms to suppliers.
European Governments’ refundable advances. As of
31 December 2018, total European Governments’ refundable
advances liabilities, recorded on the statement of financial
position in the line items “non-current other financial liabilities”
and “current other financial liabilities” due to their specific nature,amounted to € 4.6 billion (31 March 2019: € 4.6 billion), including
accrued interest.
European Governments’ refundable advances (net ofreimbursements) decreased in 2018, primarily related to the
update of the measurement of refundable advances from
European Governments on the A380 programme. Please referto the “Notes to the IFRS Consolidated Financial Statements— Note 10: Revenue and Gross Margin” and “Note 23: Other
Financial Assets and Other Financial Liabilities”.
Cash Used for Investing Activities
Management categorises cash used for investing activities into
three components: (i) industrial capital expenditures, (ii) M&A
transactions and (iii) others.
Capital expenditures. Capital expenditures (investments inproperty, plant and equipment and intangible assets) amounted
to € -2.3 billion for 2018 as compared to € -2.6 billion for 2017 and€ 3.1 billion for 2016 (first three months 2019: € 0.5 billion). The
lower capital expenditures in 2018 demonstrate the Company’ssound approach to capital allocation and supports the current
production rates. In 2018, it related to Airbus programmes of€ -1.6 billion (among others for the Beluga XL, and the ramp-up
phase of the A320 Family and the A350 XWB) and additional
projects in the Divisions of € -0.7 billion. Capital expenditures
include product-related development costs that are capitalisedin accordance with IAS 38. See “— 2.1.2.2 Capitalised
development costs”.
M&A transactions. In 2018, the € 0.5 billion figure includes
net proceeds from the disposal of Plant Holdings, Inc. andCompañía Española de Sistemas Aeronáuticos, S.A. (“CESA”)(first three months 2019: € 55 million). Please refer to the “Notes
to the IFRS Consolidated Financial Statements — Note 6:
Acquisitions and Disposals”.
In 2017, the € 0.9 billion figure includes net proceeds of around€ 600 million from the defence electronics disposal and around€ 400 million from the Vector Aerospace sale.
Free Cash Flow
The Company defines Free Cash Flow as the sum of (i) cash
provided by operating activities and (ii) cash used for investing
activities, minus (iii) change of securities, (iv) contribution toplan assets of pension schemes, (v) realised foreign exchange
results on treasury swaps and (vi) Airbus Bank activities. It isan alternative performance measure and key indicator that is
important in order to measure the amount of cash flow generated
from operations after cash used in investing activities. As a result

90

Airbus / Registration Document 2018of the factors discussed above, Free Cash Flow amounted to€ 3.5 billion for 2018 as compared to € 3.7 billion for 2017 and€ 3.2 billion for 2016 (first three months 2019: € -4.4 billion).
Free Cash Flow before M&AFree Cash Flow before mergers and acquisitions refers toFree Cash Flow adjusted for net proceeds from disposals andacquisitions. It is an alternative performance measure and key
indicator that reflects Free Cash Flow excluding those cash
flows resulting from acquisitions and disposals of businesses.
Free Cash Flow before M&A and Customer Financing
Free Cash Flow before M&A and customer financing refers toFree Cash Flow before mergers and acquisitions adjusted for
cash flow related to aircraft financing activities. It is an alternative
performance measure and indicator that may be used from time
to time by the Company in its financial guidance, especially when
there is higher uncertainty around customer financing activities.
Change in Treasury Shares
Change in treasury shares for 2018 amounted to € -49 million(first three months 2019: € no change). In 2017, there was nochange in treasury shares. Change in treasury shares for 2016
amounted to € 0.7 billion, which was mostly related to the sharebuyback programme that took place between 2 November
2015 and 30 June 2016. As of 31 December 2018 and 2017,
the Company held 636,924 and 129,525 treasury shares,
respectively (31 March 2019: 636,924 shares).
Contribution to Plan Assets of Pension Schemes
The cash outflows of € -2.5 billion, € -0.5 billion and € -0.3 billion
in 2018, 2017 and 2016, respectively (first three months 2019:€ -42 million), primarily relate to a contribution to the Contractual
Trust Arrangement (“CTA”) for allocating and generating pension
plan assets in accordance with IAS 19, as well as to plan assets
in the UK and to German benefit funds. Please refer to the “Notes
to the IFRS Consolidated Financial Statements — Note 29.1:
Post-employment Benefits — Provisions for Retirement Plans”.

2.1.6.2

Cash and Cash Equivalents
and Securities

The cash and cash equivalents and securities portfolio of
the Company is invested mainly in non-speculative financial
instruments, mostly highly liquid, such as certificates of deposit,
overnight deposits, commercial paper, other money market
instruments and bonds. Please refer to the “Notes to the IFRS
Consolidated Financial Statements — Note 35.1: Information
about Financial Instruments — Financial Risk Management”.
The Company has a partially automated cross-border anddomestic cash pooling system in all countries with majorgroup presence and whenever country regulations allow suchpractice (among others this includes mainly France, Germany,
Spain, the Netherlands, the UK and the US). The cash poolingsystem enhances Management’s ability to assess reliably andinstantaneously the cash position of each subsidiary within
the Company and enables Management to allocate cash
optimally within the Company depending upon shifting shortterm needs.

REGISTRATION DOCUMENT 2018
Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.1 Operating and Financial Review

2.1.6.3

Financing Liabilities

The outstanding balance of the Company’s consolidated
financing liabilities decreased from € 11.2 billion as of
31 December 2017 to € 8.9 billion as of 31 December 2018.
The decrease is mainly due to early settlement of liabilities
to financial institutions with the European Investment Bank(“EIB”) and the Development Bank of Japan (“DBJ”), and to
the settlement of a Euro Medium Term Note (“EMTN”) bondin September 2018. As of 31 March 2019, it increased to€ 11.0 billion, mainly related to the application of IFRS 16 andthe issuance of commercial papers. For further information,please refer to the “Notes to the IFRS Consolidated Financial
Statements — Note 34.3: Net Cash — Financing Liabilities”.

2.1.6.4

Sales Financing

The Company favours cash sales and encourages independent
financing by customers, in order to avoid retaining credit orasset risk in relation to delivered products. However, in orderto support product sales, primarily at Airbus and Airbus
Helicopters, the Company may agree to participate in thefinancing of customers, on a case-by-case basis, directly or
through guarantees provided to third parties.
The financial markets remain unpredictable, which may cause
the Company to increase its future outlays in connection withcustomer financing of commercial aircraft and helicopters,
mostly through finance leases and secured loans and if
deemed necessary through operating lease structures.
Nevertheless, the Company intends to keep the amount as
low as possible.

2

Dedicated and experienced teams structure such financing
transactions and closely monitor total finance and asset value
exposure of the Company and its evolution in terms of quality,
volume and intensity of cash requirements. The Company
aims to structure all financing it provides to customers in linewith market-standard contractual terms so as to facilitate any
subsequent sale or reduction of such exposure.

EVOLUTION OF AIRBUS GROSS EXPOSURE DURING 2018 IN US$ MILLION

1,516

31 December 2017123

Additions

Disposals-565

Amortisation

31 December 2018

Airbus gross customer financing exposure as of 31 December
2018 is distributed over 38 aircraft, operated at any time byapproximately 11 airlines. In addition, the level of exposure
may include other aircraft-related assets, such as spare parts.
More than 90% of Airbus gross customer financing exposure
is distributed over 7 countries (this excludes backstop
commitments).
Over the last three years (2016 to 2018), the average number ofaircraft delivered in respect of which financing support has been
provided by Airbus amounted to less than 1% of the average

-155

919

number of deliveries over the same period, i.e. 4 aircraft financed
per year out of 735 deliveries per year on average.
Airbus Helicopters’ gross customer financing exposureamounted to € 109 million as of 31 December 2018. This
exposure is distributed over 62 helicopters, operated byapproximately 6 companies.
For further information, please refer to the “Notes to the IFRS
Consolidated Financial Statements — Note 25: Sales Financing
Transactions”.

2.1.7 Hedging Activities
More than 75% of the Company’s revenues are denominatedin US dollars, with approximately 60% of such currency
exposure “naturally hedged” by US dollar-denominated costs.
The remainder of costs is incurred primarily in euros, and to alesser extent, in pounds sterling. Consequently, to the extent
that the Company does not use financial instruments to hedge

its net current and future exchange rate exposure from the timeof a customer order to the time of delivery, its profits will beaffected by market changes in the exchange rate of the US dollar
against these currencies, and to a lesser extent, by market
changes in the exchange rate of pound sterling against the euro.

Airbus / Registration Document 201891

Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.2 Financial Statements

As the Company intends to generate profits only from its
operations and not through speculation on foreign currency
exchange rate movements, the Company uses hedging
strategies solely to mitigate the impact of exchange rate
fluctuations on its EBIT.

For further information on the Company’s hedging strategies in
response to its particular exposures as well as a description of
its current hedge portfolio, please refer to the “Notes to the IFRS
Consolidated Financial Statements — Note 35.1: Information
about Financial Instruments — Financial Risk Management”
and “Note 35.4: Notional Amounts of Derivative Financial
Instruments”.

2.2 Financial Statements
The IFRS Consolidated Financial Statements and the Company
Financial Statements of Airbus SE for the year ended
31 December 2018, together with the related notes, appendicesand independent auditors’ report, shall be deemed to beincorporated in and form part of this Registration Document.
In addition, the English version of the following document shallbe deemed to be incorporated by reference in and form partof this Registration Document:
the IFRS Consolidated Financial Statements and the Company
Financial Statements of Airbus Group SE for the year ended
31 December 2017, together with the related notes, appendicesand Auditors’ reports, as incorporated by reference in theRegistration Document filed in English with, and approved
by, the AFM on 28 March 2018 and filed in English with the
Chamber of Commerce of The Hague;
the Unaudited Condensed Interim IFRS Consolidated Financial
Information for the three-month period ended 31 March 2019and 2018.

----

Copies of the above-mentioned documents are available freeof charge upon request in English at the registered office of
the Company and on www.airbus.com (Investors > Financial
Results & Annual Reports).
Copies of the above-mentioned Registration Documents are alsoavailable in English on the website of the AFM on www.‌afm.‌nl(Professionals > Registers > Approved prospectuses). The
above-mentioned financial statements are also available in
English for inspection at the Chamber of Commerce of The
Hague.
The Company confirms that the reports of the auditors
incorporated by reference herein have been accurately
reproduced and that as far as the Company is aware and isable to ascertain from the information provided by the auditors,
no facts have been omitted which would render such reports
inaccurate or misleading.

2.3 Statutory Auditor Fees
Please refer to the “Notes to the IFRS Consolidated Financial Statements — Note 37: Auditor Fees”.

92

Airbus / Registration Document 2018

REGISTRATION DOCUMENT 2018
Management’s Discussion and Analysis of Financial Condition and Results of Operations /2.4 Information Regarding the Statutory Auditor

2.4 Information Regarding the Statutory Auditor

Ernst & Young Accountants LLP
Boompjes 258 – 3011 XZ Rotterdam
Postbus 488 – 3000 AL Rotterdam
The Netherlands
Represented by A.A. van Eimeren

Date of first appointment

Expiration of current
term of office(1)28 April 2016

10 April 2020

2

(1) A resolution was submitted to the Annual General Meeting of Shareholders and approved in 2019, in order to appoint Ernst & Young Accountants LLP as the Company’s
auditors for the 2019 financial year.

Ernst & Young Accountants LLP has a licence from the AFM to perform statutory audits for Public Interest Entities and its
representative is member of the NBA (Koninklijke Nederlandse Beroepsorganisatie van Accountants – the Royal Netherlands
Institute of Chartered Accountants). The NBA is the professional body for accountants in the Netherlands.
The Unaudited Condensed Interim IFRS Consolidated Financial Information for the three-month period ended 31 March 2019and 2018 as included in this Registration Document have not been audited.

Airbus / Registration Document 2018

93

3
Chapter94

Airbus / Registration Document 2018

3

General Descriptionof the Company
and its Share Capital
3.1
General Description of the Company
96
3.1.1 Commercial and Corporate Names,
Seat and Registered Office96
3.1.2 Legal Form
96
3.1.3 Governing Laws and Disclosures96
3.1.4 Date of Incorporation and Duration of the Company 97
3.1.5 Objects of the Company
98
3.1.6 Commercial and Companies Registry
98
3.1.7 Inspection of Corporate Documents
98
3.1.8 Financial Year
98
3.1.9 Allocation and Distribution of Income98
3.1.10 General Meetings
99
3.1.11 Disclosure of Holdings
100
3.1.12 Mandatory Disposal
101
3.1.13 Mandatory Offers
102
3.2
3.2.1
3.2.2
3.2.3

General Description of the Share Capital
103
Issued Share Capital
103
Authorised Share Capital
103
Modification of Share Capitalor Rights Attached to the Shares103
3.2.4 Securities Granting Accessto the Company’s Share Capital104
3.2.5 Changes in the Issued Share Capital105
3.3
3.3.1
3.3.2
3.3.3
3.3.4
3.3.5
3.3.6
3.3.7

Shareholdings and Voting Rights
Shareholding Structure at the End of 2018
Relationships with Principal Shareholders
Form of Shares
Changes in the Shareholding of the CompanyPersons Exercising Control over the Company
Simplified Group Structure Chart
Purchase by the Company of its Own Shares

106
106
107
109
110
110
110
112

3.4
3.4.1
3.4.2
3.4.3
3.4.4

Dividends
Dividends and Cash Distributions Paid
Dividend Policy of the Company
Unclaimed Dividends
Taxation

114
114
114
114
114

Airbus / Registration Document 201895

General Description of the Company and its Share Capital /3.1 General Description of the Company

3.1 General Description of the Company
3.1.1 Commercial and Corporate Names, Seat and Registered OfficeCommercial Name: Airbus

Seat (statutaire zetel): Amsterdam

Statutory Name: Airbus SE

Tel: +31 (0)71,5245,600

Registered Office: Mendelweg 30, 2333 CS Leiden,
The Netherlands

Fax: +31 (0)71,5232,807

3.1.2 Legal Form
The Company is a European public company (Societas Europaea), with its corporate seat in Amsterdam, The Netherlands andregistered with the Dutch Commercial Register (Handelsregister) under number 24288945. The Company’s legal identifier (LEI)
is MIN079WLOO247M1IL051. As a company operating worldwide, the Company is subject to, and operates under, the laws ofeach country in which it conducts business.

3.1.3 Governing Laws and Disclosures
The Company is governed by the laws of the Netherlands(in particular Book 2 of the Dutch Civil Code and the Dutch
Corporate Governance Code) and by its Articles of Association(the “Articles of Association”).
The Company is subject to various legal provisions of the Dutch
Financial Supervision Act (Wet op het financieel toezicht) (the“WFT”). In addition, given the fact that its shares are admitted
for trading on a regulated market in France, Germany and Spain,
the Company is subject to certain laws and regulations in thesethree jurisdictions. A summary of the main regulations applicableto the Company in relation to information to be made publicin these three jurisdictions, as well as the Netherlands, is set
out below.

3.1.3.1

Periodic Disclosure Obligations

Pursuant to Directive 2004 / 109 / EC on the harmonisationof transparency requirements in relation to information about
issuers whose securities are admitted to trading on a regulated
market (as amended, the “Transparency Directive”), theCompany is required to disclose certain periodic and ongoing
information (the “Regulated Information”).
Pursuant to the Transparency Directive, the Company must
disseminate such Regulated Information throughout theEuropean Community in a manner ensuring fast access to suchinformation on a non-discriminatory basis. For this purpose,
the Company may use a professional service provider (wire). In
addition, Regulated Information must be filed at the same timewith the relevant competent market authority. The Company
must then ensure that Regulated Information remains publicly
available for at least 10 years.

96

Airbus / Registration Document 2018

Finally, Regulated Information must be made available for central
storage by a mechanism that is officially designated by theCompany’s home Member State.
Dutch Regulations
For the purpose of the Transparency Directive, supervision of theCompany is effected by the Member State in which it maintains
its corporate seat, which is the Netherlands. The competentmarket authority that assumes final responsibility for supervisingcompliance by the Company in this respect is the AFM.
Under the Transparency Directive as implemented under Dutch
law, the Company is subject to a number of periodic disclosure
requirements, such as:
publishing an Annual Financial Report, together with an audit
report drawn up by the Statutory Auditors, within four months
after the end of each financial year; andpublishing a semi-Annual Financial Report, within threemonths after the end of the first six months of the financial year.

---

In addition, the Company must file with the AFM, within five days
following their adoption by the Company’s shareholders, its
audited annual financial statements (including the consolidatedones), the management report, the Auditors’ report and otherinformation related to the financial statements.
French Regulations
In accordance with the requirement set forth in the Transparency
Directive to disseminate Regulated Information throughout theEuropean Community, the Company is required to provide
simultaneously in France the same information as that provided
abroad.

REGISTRATION DOCUMENT 2018
General Description of the Company and its Share Capital /3.1 General Description of the Company

German Regulations

Dutch Regulations

Due to the listing of the Company’s shares in the Prime Standard
sub-segment of the Regulated Market (regulierter Markt) of theFrankfurt Stock Exchange, the Company is subject to certain
post-listing obligations as described below. The Company isincluded inter alia in the selection index MDAX, the MidCap
index of Deutsche Börse AG.

Following the implementation of the Transparency Directive
into Dutch law, the Company must publicly disclose RegulatedInformation and also file Regulated Information with the AFM,
which will keep all relevant Regulated Information in a publicly
available register. The Company will, whenever it discloses
inside information pursuant to applicable mandatory law aspart of the Regulated Information, disclose and disseminate
throughout the European Community any such information.

Pursuant to the Exchange Rules (Börsenordnung) of theFrankfurt Stock Exchange, the Company is required to publish
consolidated annual and semi-annual financial statements aswell as consolidated quarterly reports which may be preparedin English only. In addition, pursuant to the Exchange Rules,
the Company is required to publish a financial calendar at the
beginning of each financial year in German and English. The
Company is also required to hold an analysts’ meeting at least
once per year in addition to the press conference regarding theannual financial statements.
Spanish Regulations
In accordance with the requirement set forth in the Transparency
Directive to disseminate Regulated Information throughout theEuropean Community, the Company is required to provide
simultaneously in Spain the same information as that provided
abroad.

3.1.3.2

Ongoing Disclosure Obligations

Pursuant to the Transparency Directive, Regulated Information
includes in particular “inside information” as defined pursuant
to Article 7 of EU Regulation No. 596 / 2014 on market abuse(the “Market Abuse Regulation” or “MAR”). Such informationmust be disseminated throughout the European Community(see introduction to section “— 3.1.3.1 Periodic Disclosure
Obligations”).
Inside information consists of information of a precise nature
which has not been made public, relating, directly or indirectly,
to one or more issuers or to one or more financial instruments
and which, if it were made public, would be likely to have asignificant effect on the prices of those financial instruments oron the price of related derivative financial instruments.
Inside information must be disclosed to the markets as soon as
possible. However, an issuer may under its own responsibility
delay the public disclosure of inside information so as not toprejudice its legitimate interests provided that such delay would
not be likely to mislead the public and provided that the issuer
is able to ensure the confidentiality of that information.

Under Dutch law, the Company must also publish any change
in the rights attached to its shares, as well as any changes in
the rights attached to any rights issued by the Company toacquire Airbus shares.
French Regulations

3

Any inside information as defined above will be disclosed in
France by means of dissemination throughout the European
Community, as it is organised under Dutch law implementing
the Transparency Directive so as to provide simultaneously inFrance equivalent information to that provided abroad.
German Regulations
Any inside information as defined above will be disclosed inGermany by means of dissemination throughout the European
Community, as it is organised under Dutch law implementing
the Transparency Directive so as to provide simultaneously inGermany equivalent information to that provided abroad.
Spanish Regulations
Any inside information as defined above will be disclosed
simultaneously in Spain by notifying it to the CNMV which shall,in turn, make it public through its webpage.
Any other information of a financial or corporate nature which
the Company is required by law to make public in Spain or
which the Company deems necessary to disclose to investors
shall be also notified to the CNMV which shall also publish it
through its webpage.
Pursuant to the Spanish securities rules and regulations, theCompany is also required to make available to shareholders
and file with the CNMV a Corporate Governance Report in the
Spanish language or in a language customary in the sphere ofinternational finance on an annual basis.

3.1.4 Date of Incorporation and Duration of the Company
The Company was incorporated on 29 December 1998 for an unlimited duration.

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General Description of the Company and its Share Capital /3.1 General Description of the Company

3.1.5 Objects of the Company
Pursuant to its Articles of Association, the objects of theCompany are to hold, co-ordinate and manage participations orother interests and to finance and assume liabilities, provide forsecurity and/or guarantee debts of legal entities, partnerships,
business associations and undertakings that are involved in:aeronautic, defence, space and/or communication--theindustry; orthat are complementary, supportive or ancillary--activities
thereto.

3.1.6 Commercial and Companies Registry
The Company is registered with the Dutch Commercial Register (Handelsregister) under number 24288945.

3.1.7 Inspection of Corporate Documents
The Articles of Association are available for inspection in Dutchat the Chamber of Commerce.
In France, the Articles of Association are available at theoperational headquarters of the Company (2, rond-point Emile
Dewoitine, 31700 Blagnac, France, Tel.: +33 5 81 31 75 00).

In Spain, the Articles of Association are available at the CNMV
and at the Madrid office of the Company (Avenida de Aragón
404, 28022 Madrid, Spain, Tel.: +34 91,585 70 00).
The documents incorporated by reference into this Registration
Document are available on www.airbus.com.

In Germany, the Articles of Association are available at theMunich office of the Company (Willy-Messerschmitt-Strasse
1, 82024 Ottobrunn, Germany, Tel.: +49 89 60 70).

3.1.8 Financial YearThe financial year of the Company starts on 1 January and ends on 31 December of each year.

3.1.9 Allocation and Distribution of Income
3.1.9.1

Dividends

The Board of Directors shall determine which part of the profits
of the Company shall be attributed to reserves. The remaining
distributable profit shall be at the disposal of the shareholders’meeting.
The shareholders’ meeting may resolve (if so proposed by the
Board of Directors) that all or part of a distribution on shares shallbe paid in Airbus shares or in the form of assets as opposed
to cash.
The declaration of a dividend, an interim dividend or another
distribution to the shareholders shall be made known to themwithin seven days after such declaration. Declared dividends,
interim dividends or other distributions shall be payable on suchdate(s) as determined by the Board of Directors.

98

Airbus / Registration Document 2018

Dividends, interim dividends and other distributions on sharesshall be paid by bank transfer to the bank or giro accounts
designated in writing to the Company by, or on behalf of,shareholders at the latest 14 days after their announcement.
The persons entitled to a dividend, interim dividend or other
distribution shall be the shareholders as at a record date to be
determined by the Board of Directors for that purpose, whichdate may not be a date prior to the date on which such dividend,interim dividend or other distribution is declared.

3.1.9.2

Liquidation

In the event of the dissolution and liquidation of the Company,
the assets remaining after payment of all debts and liquidation
expenses shall be distributed amongst the holders of the sharesin proportion to their shareholdings.

REGISTRATION DOCUMENT 2018
General Description of the Company and its Share Capital /3.1 General Description of the Company

3.1.10 General Meetings
3.1.10.1 Calling of Meetings
Shareholders’ meetings are held as often as the Board of
Directors deems necessary, when required under the Dutch
Civil Code (as a result of a decrease of the Company’s equity
to or below half of the Company’s paid up and called up capital)
or upon the request of shareholders holding, individually or
together, at least 10% of the total issued share capital of theCompany. The AGM of Shareholders of the Company is held
within six months of the end of the financial year.
The Board of Directors must give notice of shareholders’meetings through publication of a notice on the Company’s
website (www.airbus.com), which will be directly andpermanently accessible until the shareholders’ meeting. The
Company must comply with the statutory rules providing fora minimum convening period, which currently require at least
42 days of notice. The convening notice must state the items
required under Dutch law.
Shareholders’ meetings are held in Amsterdam, The Hague,
Rotterdam or Haarlemmermeer (Schiphol Airport). The Boardof Directors may decide that shareholders’ meetings may beattended by means of electronic or video communication
devices from the locations mentioned in the convening notice.
The Board of Directors must announce the date of the AGM
of Shareholders at least 10 weeks before the Meeting. A
matter which one or more shareholders or other parties withmeeting rights collectively representing at least the statutory
threshold (which is currently 3% of the issued share capital)
have requested in writing to be put on the agenda for a General
Meeting of Shareholders shall be included in the convening
notice or shall be announced in the same fashion, if thesubstantiated request or a proposal for a resolution is received
by the Company no later than the 60 th day before the general
meeting. When exercising the right to put a matter on theagenda for a General Meeting of Shareholders, the respective
shareholder or shareholders are obliged to disclose their fulleconomic interest to the Company. The Company must publish
such disclosure on its website.
A request as referred to in the preceding paragraph may only
be made in writing. The Board of Directors can decide that in“writing” is understood to include a request that is recorded
electronically.

3.1.10.2 Right to Attend Shareholders’ Meetings
Each holder of one or more shares may attend shareholders’meetings, either in person or by written proxy, speak andvote according to the Articles of Association. See “— 3.1.10.4
Conditions of Exercise of Right to Vote”. However, under (andsubject to the terms of) the Articles of Association these rights
may be suspended under certain circumstances. A shareholder,or another person who has the right to attend a shareholders’meeting, can be represented by more than one proxy holder,provided that only one proxy holder can exercise the rights
attached to each share.

The persons who have the right to attend and vote atshareholders’ meetings are those who are on record in aregister designated for that purpose by the Board of Directors
on the registration date referred to in the Dutch Civil Code which
is currently the 28th day prior to the day of the shareholders’meeting (the “Registration Date”), irrespective of who may beentitled to the shares at the time of that meeting.
As a prerequisite to attending the shareholders’ meeting and to
casting votes, the Company, or alternatively an entity or person
so designated by the Company, should be notified in writingby each holder of one or more shares and those who derive
the aforementioned rights from these shares, not earlier thanthe Registration Date, of the intention to attend the meeting inaccordance with the relevant convening notice.

3

Shareholders holding their Company shares through Euroclear
France S.A. who wish to attend general meetings will have torequest from their financial intermediary or accountholder anadmission card and be given a proxy to this effect from Euroclear
France S.A. in accordance with the relevant convening notice.
For this purpose, a shareholder will also be able to requestthat its shares be registered directly (and not through Euroclear
France S.A.) in the register of the Company. However, only
shares registered in the name of Euroclear France S.A. may
be traded on stock exchanges.
In order to exercise their voting rights, the shareholders will
also be able, by contacting their financial intermediary or
accountholder, to give their voting instructions to Euroclear
France S.A. or to any other person designated for this purpose,as specified in the relevant convening notice.
Pursuant to its Articles of Association, the Company may provide
for electronic means of attendance, speaking and voting at theshareholders’ meetings in such circumstances and subject tosuch conditions as determined by the Board of Directors.

3.1.10.3 Majority and Quorum
All resolutions are adopted by means of a simple majority ofthe votes cast except when a qualified majority is prescribedby the Articles of Association or by Dutch law. No quorum isrequired for any shareholders’ meeting to be held except as
required under applicable law for a very limited number ofresolutions of an extraordinary nature. Dutch law requires a
special majority for the passing of certain resolutions: inter alia,
capital reduction, exclusion of pre-emption rights in connection
with share issues, statutory mergers or statutory de-mergers;
the passing of such resolutions requires a majority of two-thirdsof the votes cast if 50% of the share capital with voting rights
is not present at the shareholders’ meeting (or otherwise a
simple majority). In addition, resolutions to amend the Articles
of Association or to dissolve the Company may only be adopted
with a majority of at least two-thirds of the valid votes cast at ashareholders’ meeting, whatever the quorum present at suchmeeting, and resolutions to amend certain provisions of the
Articles of Association may only be adopted with a majority ofat least 75% of the valid votes cast at a shareholders’ meeting,whatever the quorum present at such meeting.

Airbus / Registration Document 201899

General Description of the Company and its Share Capital /3.1 General Description of the Company

3.1.10.4 Conditions of Exercise of Right to Vote
In all shareholders’ meetings, each shareholder has one vote inrespect of each share it holds. The major shareholders of theCompany – as set forth in “— 3.3.2 Relationships with Principal
Shareholders” – do not enjoy different voting rights from thoseof the other shareholders.
A shareholder whose shares are subject to a pledge or usufruct
shall have the voting rights attaching to such shares unlessotherwise provided by law or by the Articles of Association orif, in the case of a usufruct, the shareholder has granted voting
rights to the usufructuary. Pursuant to the Articles of Associationand subject to the prior consent of the Board of Directors, apledgee of shares in the Company may be granted the right tovote in respect of such pledged shares.
According to the Articles of Association, no vote may be castat the General Meeting on a share that is held by the Company
or a subsidiary, nor for a share in respect of which one of themholds the depository receipts. Usufructuaries and pledgees ofshares that are held by the Company or its subsidiaries are,however, not excluded from their voting rights, in case the rightof usufruct or pledge was vested before the share was held by
the Company or its subsidiary.

3.1.11 Disclosure of Holdings
Pursuant to the WFT, any person who, directly or indirectly,
acquires or disposes of an (actual or deemed) interest in thecapital, voting rights or gross short position of the Company
must immediately give written notice to the AFM by means ofa standard form, if, as a result of such acquisition or disposal,
the percentage of capital interest or voting rights held by such
person meets, exceeds or falls below the following thresholds:
3%, 5%, 10%, 15%, 20%, 25%, 30%, 40%, 50%, 60%, 75%
and 95%. Any person whose interest in the capital, voting rights
or gross short position in the Company meets, exceeds orfalls below one or several of the above-mentioned thresholds
due to a change in the Company’s outstanding capital, or invoting rights attached to the shares as notified to the AFM by
the Company, should notify the AFM no later than the fourth
trading day after the AFM has published the notification by theCompany. Among other things, the Company is required to
notify the AFM immediately if its outstanding share capital or
voting rights have changed by 1% or more since the Company’s
previous notification. Additional disclosure and/or publication
obligations apply under European regulations for net shortpositions in respect of the Company.
If at the end of a calendar year the composition of a shareholder’sholding differs from its previous disclosure as a result of theconversion of certain types of securities or following the exerciseof rights to acquire voting rights, this shareholder must thenprovide an update of its previous disclosure within four weeksof the end of each calendar year by giving written notice thereof
to the AFM. The disclosures are published by the AFM on its
website (www.afm.nl).
Pursuant to the Articles of Association, shareholders must notify
the Company when meeting or crossing the thresholds above.
The Articles of Association also contain disclosure obligations
for shareholders that apply when their interests in the Company
reach or cross certain thresholds.

Under the Articles of Association, the disclosure obligationsof shareholders are enhanced in several ways beyond what isrequired under the WFT, including by requiring the disclosureof additional information, tying the disclosure obligations toa broader range of interests in the capital or voting rights of
the Company and by requiring a shareholder to notify theCompany if his or her interest reaches, exceeds or falls below
the Mandatory Disposal Threshold (as defined below) or if theinterest of a shareholder (alone or a member of a concert) which
is above such Mandatory Disposal Threshold changes in its
composition, nature and/or size.
Failure to comply with the legal obligation to notify a change inshareholding under the WFT is a criminal offence punishable
by criminal and administrative penalties as well as civil law
penalties, including the suspension of voting rights. Failure tocomply with a notification under the Articles of Association canlead to a suspension of meeting and voting rights.

Disclosure Requirements for Membersof the Board of Directors and the Executive
Committee
Disclosure of Holdings
In addition to the requirements under the WFT regarding thedisclosure of holdings in case the specified thresholds are met
or exceeded or if holdings fall below these thresholds, Membersof the Board of Directors must report to the AFM the numberof shares in the Company and attached voting rights (1) held byhim or an entity controlled by him, within two weeks following
his appointment as Director, whether or not such shareholdings
meet or exceed any of the specified thresholds. Subsequently,
any Member of the Board of Directors is required to notify the
AFM of any changes in such number of shares in the Company
and attached voting rights.

(1) In this context, the term “shares” also includes for example depositary receipts for shares and rights resulting from an agreement to acquire shares or depositary
receipts for shares, specifically call options, warrants, and convertible bonds. Equally, the term “voting rights” also includes actual or contingent rights to voting
rights (e.g., embedded in call options, warrants or convertible bonds).

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REGISTRATION DOCUMENT 2018
General Description of the Company and its Share Capital /3.1 General Description of the Company

Disclosure of Transactions Carried Out on Any Securities
Issued by the Company
Based on the Market Abuse Regulation, certain persons
discharging managerial or supervisory responsibilities within
the Company as well as persons closely associated with them(together “Insiders”, as defined below), are required to notify
the Company and the AFM within three trading days of alltransactions conducted for their own account involving sharesof the Company, or derivatives or other financial instruments
related to such shares, unless the aggregate amount ofsuch transactions does not exceed € 5,000 in respect of alltransactions in a calendar year.
“Insiders” for the Company include (i) Members of the Boardof Directors and the Executive Committee of the Company aswell as certain other senior executives who are not membersof these bodies and who have regular access to inside
information relating directly or indirectly to the Company
and power to take managerial decisions affecting the future
developments and business prospects of the Company,(ii) persons closely associated with any person mentioned
under category (i) (including their spouses, life partners or any
partner considered by national law as equivalent to the spouse,dependent children and other relatives who have shared thesame household), and (iii) legal entities, trusts or partnerships

whose managerial responsibilities are discharged by any personreferred to in categories (i) or (ii) or which are directly or indirectly
controlled by such a person, or that have been set up for the
benefit of such a person, or whose economic interests aresubstantially equivalent to those of such a person.
The Company has adopted specific internal insider trading rules(the “Insider Trading Rules”) in order to ensure compliance withthe above requirements and with other share trading regulations
applicable in the Netherlands, France, Germany and Spain. The
Insider Trading Rules are available on the Company’s website,and provide in particular that: (i) all employees and Directors
are prohibited from conducting transactions in the Company’s
shares or stock options if they have inside information, and(ii) certain persons are only allowed to trade in the Company’s
shares or stock options within very limited periods and havespecific information obligations to the ITR Compliance Officer of
the Company and the competent financial market authorities withrespect to certain transactions. The ITR Compliance Officer is
responsible for the implementation of the Insider Trading Rules.

3

Pursuant to the Market Abuse Regulation, the Company must
maintain a list of all persons working for it by virtue of a labour
relationship or otherwise, who may have access to inside
information.

3.1.12 Mandatory Disposal
3.1.12.1 Notification Requirements andMandatory Disposal Threshold
Restricting Ownership to 15%
Under the Articles of Association, each shareholder must notify
the Company when it (or another party in respect of its interest in
the Company) must make a notification to the AFM of a substantial
interest or short position with respect to the Company, when its
interest (alone or with concert parties) reaches or crosses the
Mandatory Disposal Threshold (as defined below) or, subject
to certain conditions and exemptions, when changes occur inthe composition, nature and/or size of any interest held it or its
concert parties in excess of the Mandatory Disposal Threshold(as defined below). Failure to comply with these obligations
may, subject to a prior notification by the Company, result in thesuspension of voting and attendance rights until the shareholder
has complied with its obligations.
The Articles of Association prohibit any shareholder from holding aninterest of more than 15% of the share capital or voting rights of theCompany, acting alone or in concert with others (the “Mandatory
Disposal Threshold”). An interest (“Interest”) includes not
only shares and voting rights, but also other instruments thatcause shares or voting rights to be deemed to be at someone’s
disposal pursuant to the WFT, and must be notified to the Dutch
regulator, the AFM, if certain thresholds are reached or crossed.
Any shareholder having an interest of more than the Mandatory
Disposal Threshold must reduce its interest below the Mandatory
Disposal Threshold, for instance by disposing of its Excess Shares,
within two weeks after such notification by the Company. Upon
receipt of such notification, the voting, attendance and dividend
rights attached to the Excess Shares shall be suspended.
The same applies to concerts of shareholders and other persons

who together hold an interest exceeding the Mandatory Disposal
Threshold. Should such shareholder or concert not comply withnot exceeding the 15% Mandatory Disposal Threshold by the endof such two-week period, the voting, attendance and dividend
rights attached to all shares held by such shareholder or concert
shall be suspended, and their Excess Shares would be transferred
to a Dutch law foundation (“Stichting”), which can, and eventuallymust, dispose of them. The suspension of shareholder rights
described above shall be lifted once a shareholder or concert
complies with its obligations under the Articles of Association.
The Dutch law foundation would issue depositary receipts to therelevant shareholder in return for the Excess Shares transferredto the foundation, which would entitle the relevant shareholder tothe economic rights, but not the voting rights, attached to such
Company shares. The foundation’s articles of association andthe terms of administration governing the relationship between
the foundation and the depositary receipt holders provide, interalia, that:the Board Members of the foundation must be independent
from the Company, any grandfathered persons and theiraffiliates (see “— 3.1.12.2 Exemptions from Mandatory Disposal
Threshold”) and any holder of depositary receipts and theiraffiliates (there is an agreement under which the Company
will, inter alia, cover the foundation’s expenses and indemnify
the Board Members against liability);
the Board Members are appointed (except for the initial Board
Members who were appointed at incorporation) and dismissedby the Management Board of the foundation (the Company
may however appoint one Board Member in a situation where
there are no foundation Board Members);----

Airbus / Registration Document 2018101

General Description of the Company and its Share Capital /3.1 General Description of the Company

foundation has no discretion as to the exercise of voting--therights attached to any of the Company shares held by it andwill in a mechanical manner vote to reflect the outcome of thevotes cast (or not cast) by the other shareholders, and thefoundation will distribute any dividends or other distributions
it receives from the Company to the holders of depositary
receipts; andno transfer of a depositary receipt can be made without theprior written approval of the foundation’s Board.

--

For any shareholder or concert, the term “Excess Shares”,
as used above, refers to such number of shares comprisedin the interest of such shareholder or concert exceeding the
Mandatory Disposal Threshold which is the lesser of: (i) the
shares held by such shareholder or concert which represent a
percentage of the Company’s issued share capital that is equal
to the percentage with which the foregoing interest exceeds the
Mandatory Disposal Threshold; and (ii) all shares held by such
person or concert.
This restriction is included in the Articles of Association to reflect
the Company’s further normalised governance going forward,
aiming at a substantial increase of the free float and to safeguard
the interests of the Company and its stakeholders (including all
its shareholders), by limiting the possibilities of influence above
the level of the Mandatory Disposal Threshold or takeovers otherthan a public takeover offer resulting in a minimum acceptanceof 80% of the share capital referred to below.

3.1.12.2 Exemptions from Mandatory Disposal
Threshold
The restrictions pursuant to the Mandatory Disposal Thresholdunder the Articles of Association do not apply to a person who
has made a public offer with at least an 80% acceptance(including any Airbus shares already held by such person).
These restrictions also have certain grandfathering exemptions
for the benefit of shareholders and concerts holding interests
exceeding the Mandatory Disposal Threshold on 2 April 2013
(the “Exemption Date”), which is the date of first implementationof the Mandatory Disposal Threshold.
Different grandfathering regimes apply to such shareholders andconcerts, depending on the interests and the nature thereof heldby each such shareholder or concert on the Exemption Date.
The Company has confirmed that: (i) the specific exemption in
Article 16.1.b of the Articles of Association applies to Sociétéde Gestion de Participations Aéronautiques (“Sogepa”), as
it held more than 15% of the outstanding Company voting
rights and shares including the legal and economic ownershipthereof on the Exemption Date; and (ii) the specific exemption in
Article 16.1.c applies to the concert among Sogepa, Gesellschaft
zur Beteiligungsverwaltung GZBV mbH & Co. KG (“GZBV”)
and Sociedad Estatal de Participaciones Industriales (“SEPI”),
as they held more than 15% of the outstanding Company voting
rights and shares including the legal and economic ownershipthereof on the Exemption Date.

3.1.13 Mandatory Offers
3.1.13.1 Takeover Directive
The Directive 2004 / 25 / EC on takeover bids (the “Takeover
Directive”) sets forth the principles governing the allocation oflaws applicable to the Company in the context of a takeover bid
for the shares of the Company. The Takeover Directive refers to
the rules of the Netherlands and the rules of the European Union
Member State of the competent authority that must be chosen
by the Company from among the various market authorities
supervising the markets where its shares are listed.
For the Company, matters relating to, inter alia, the consideration
offered in the case of a bid, in particular the price, and mattersrelating to the bid procedure, in particular the information on
the offeror’s decision to make a bid, the contents of the offer
document and the disclosure of the bid, shall be determinedby the laws of the European Union Member State having thecompetent authority, which will be selected by the Company
at a future date.
Matters relating to the information to be provided to theemployees of the Company and matters relating to company
law, in particular the percentage of voting rights which confers
control and any derogation from the obligation to launch a102

Airbus / Registration Document 2018bid, the conditions under which the Board of Directors of theCompany may undertake any action which might result in thefrustration of the bid, the applicable rules and the competentauthority will be governed by Dutch law (see “— 3.1.13.2 Dutch
Law”).

3.1.13.2 Dutch Law
In accordance with the Dutch act implementing the Takeover
Directive (the “Takeover Act”), shareholders are required tomake a public offer for all issued and outstanding shares in
the Company’s share capital if they — individually or acting
in concert (as such term is defined in the Takeover Act),
directly or indirectly — have 30% or more of the voting rights(significant control) in the Company. In addition to the otheravailable exemptions that are provided under Dutch law, therequirement to make a public offer does not apply to persons,
who at the time the Takeover Act came into force, alreadyheld – individually or acting in concert – 30% or more of thevoting rights in the Company. In the case of such a concert,a new Member of the concert can be exempted if it satisfies
certain conditions.

REGISTRATION DOCUMENT 2018
General Description of the Company and its Share Capital /3.2 General Description of the Share Capital

3.2 General Description of the Share Capital
3.2.1 Issued Share Capital
As of 31 December 2018, the Company’s issued share capital amounted to € 776,367,881, consisting of 776,367,881 fully paid-up
shares of a nominal value of € 1 each.

3.2.2 Authorised Share Capital3

As of 31 December 2018, the Company’s authorised share capital amounted to € 3 billion, consisting of 3 billion shares of € 1 each.

3.2.3 Modification of Share Capital or Rights Attached to the Shares
The shareholders’ meeting has the power to authorise theissuance of shares. The shareholders’ meeting may also
authorise the Board of Directors, for a period of no more than
five years, to issue shares and to determine the terms andconditions of share issuances.

Pursuant to the shareholders’ resolutions adopted at theAGM held on 11 April 2018, the powers to issue shares andto grant rights to subscribe for shares and to limit or exclude
preferential subscription rights for existing shareholders havebeen delegated to the Board of Directors for the purpose of:

Holders of shares have a pre-emptive right to subscribe for any
newly issued shares in proportion to the aggregate nominal
value of shares held by them, except for (i) shares issued forconsideration other than cash, (ii) shares issued to employeesof Airbus and (iii) shares issued pursuant to a previously granted
right to subscribe for those shares. For the contractual position
as to pre-emption rights, see “— 3.3.2 Relationships with
Principal Shareholders”.

1. employee Share Ownership Plans and share-related Long-Term
Incentive Plans, provided that such powers shall be limited to
0.14% of the Company’s authorised share capital; andThe shareholders’ meeting also has the power to limit or to
exclude pre-emption rights in connection with new issues ofshares, and may authorise the Board of Directors for a periodof no more than five years, to limit or to exclude pre-emption
rights. All resolutions in this context must be approved by a
two-thirds majority of the votes cast during the shareholders’meeting in the case where less than half of the capital issued
is present or represented at said meeting.
However, the Articles of Association provide that the shareholders’meeting is not authorized to pass any shareholders’ resolution
to issue shares or to grant rights to subscribe for shares if theaggregate issue price is in excess of € 500 million per shareissuance, and no preferential subscription rights exist in respect
thereof (by virtue of Dutch law, or because they have been
excluded by the competent corporate body). The same limitation
applies if the shareholders’ meeting wishes to designate theBoard of Directors to have the authority to resolve on such shareissuance or granting of rights. These limitations in the Articles of
Association can only be changed by the shareholders’ meetingwith a 75% voting majority.

2. funding the Company and any of its subsidiaries, provided
that such powers shall be limited to 0.3% of the Company’s
authorised share capital.
Such powers have been granted for a period expiring at the
AGM to be held in 2019, and shall not extend to issuing shares or
granting rights to subscribe for shares if (i) there is no preferential
subscription right (by virtue of Dutch law, or because it has been
excluded by means of a resolution of the competent corporatebody) and (ii) it concerns an aggregate issue price in excess of€ 500 million per share issuance.
At the AGM held on 11 April 2018, the Board of Directors was
authorised, for a period of 18 months from the date of such AGM,
to repurchase shares of the Company, by any means, including
derivative products, on any stock exchange or otherwise, aslong as, upon such repurchase, the Company would not holdmore than 10% of the Company’s issued share capital, and at
a price per share not less than the nominal value and not morethan the higher of the price of the last independent trade andthe highest current independent bid on the trading venues of
the regulated market of the country in which the purchase iscarried out.
The shareholders’ meeting may reduce the issued share capitalby cancellation of shares, or by reducing the nominal valueof the shares by means of an amendment to the Articles of
Association. The cancellation of shares requires the approval ofa two-thirds majority of the votes cast during the shareholders’

Airbus / Registration Document 2018103

General Description of the Company and its Share Capital /3.2 General Description of the Share Capitalmeeting in the case where less than half of the capital issued ispresent or represented at said meeting; the reduction of nominal
value by means of an amendment to the Articles of Association
requires the approval of a two-thirds majority of the votes castduring the shareholders’ meeting (unless the amendment to
the Articles of Association also concerns an amendment which
under the Articles of Association requires a 75% voting majority).

At the AGM held on 11 April 2018, the Board of Directors andthe Chief Executive Officer were authorised, with powers of
substitution, to implement a cancellation of shares held or
repurchased by the Company, including the authorisation
to establish the exact number of the relevant shares thus
repurchased to be cancelled.

3.2.4 Securities Granting Access to the Company’s Share Capital
Except for convertible bonds (See “— Corporate Governance — 4.3.3 Long-Term Incentive Plans” and please refer to the “Notes
to the IFRS Consolidated Financial Statements — Note 34.3: Financing liabilities”), there are no securities that give access,
immediately or over time, to the share capital of the Company.
The table below shows the total potential dilution that would occur if all the convertible bonds issued as of 31 December 2018
were exercised:

Total number of Company shares issued as of 31 December 2018
Total number of Company shares which may be issued
following exercise of the convertible bonds

Total potential Company share capital

Number ofsharesPercentage ofdiluted capital

Number of
voting rights

Percentage ofdiluted voting
rights(1)776,367,881

99.357%775,730,957

99.357%

5,022,990

0.643%

5,022,990

0.643%

781,390,871

100%

780,753,947

100%(1) The potential dilutive effect on capital and voting rights of the exercise of these convertible bonds may be limited as a result of the Company’s share repurchase programmes
and in the case of subsequent cancellation of repurchased shares. See “— 3.3.7.1 Dutch law and information on share repurchase programmes”.

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Airbus / Registration Document 2018

REGISTRATION DOCUMENT 2018
General Description of the Company and its Share Capital /3.2 General Description of the Share Capital

3.2.5 Changes in the Issued Share Capital
Nominal
Numbervalue of sharesperissued /share cancelled

Date

Nature of Transaction

20 June 2013

Cancellation of shares upon authorisation
granted by the Extraordinary General Meeting
held on 27 March 2013

€ 1 47,648,691

29 July 2013

Issue of shares for the purposeof an employee offering€1

27 September
2013

Cancellation of shares upon authorisation
granted by the Extraordinary General
Meeting held on 27 March 201327 September
2013

Total number
of issued
shares after
Premium(1) transaction

Total issued
capital after
transaction-

779,719,254€ 779,719,254

2,113,245€ 57,580,650

781,832,499€ 781,832,499€1

3,099,657-

778,732,842€ 778,732,842

Cancellation of shares upon authorisation
granted by the Annual Shareholders’Meeting held on 29 May 2013

€1

2,448,884-

776,283,958€ 776,283,958

In 2013

Issue of shares following exercise
of options granted to employees(2)€16,873,677€ 176,017,918

783,157,635€ 783,157,635

In 2014Issue of shares following exercise
of options granted to employees(2)€11,871,419€ 50,619,684

784,780,585€ 784,780,585

In 2015

Cancellation of shares upon authorisation
granted by the Annual Shareholders’Meeting held on 27 May 2015

€12,885,243-

785,333,784€ 785,333,784

In 2015

Issue of shares following exercise
of options granted to employees(2)€11,910,428-

785,344,784€ 785,344,784

In 2016

Cancellation of treasury shares€1

14,131,131-

771,213,653€ 771,213,653

In 2016

Issues of shares for the purposeof an employee offering€1

1,474,716-

772,688,369€ 772,688,369

In 2016

Issue of shares following exercise
of options granted to employees(2)€1

224,500-

772,912,869€ 772,912,869

In 2017

Issues of shares for the purposeof an employee offering€1

1,643,193-

774,556,062€ 774,556,062

In 2017

Issues of shares for the purposeof an employee offering€1

1,643,193-

774,556,062€ 774,556,062

In 2018

Issues of shares for the purposeof an employee offering€1

1,811,819-

776,367,881€ 776,367,881

3(1) The costs (net of taxes) related to the initial public offering of the shares of the Company in July 2000 have been offset against share premium for an amount of € 55,849,772.
(2) For information on Stock Option Plans under which these options were granted to the Company’s employees, see “— Corporate Governance — 4.3.3 Long-Term Incentive Plans”.

In the course of 2018, a total number of 1,811,819 new shares were issued, all in the framework of the Employee Share Ownership
Plan (“ESOP”). During 2018, (i) the Company repurchased 507,399 shares and (ii) none of the treasury shares were cancelled. As
a result, as at 31 December 2018, the Company held 636,924 treasury shares.

Airbus / Registration Document 2018105

General Description of the Company and its Share Capital /3.3 Shareholdings and Voting Rights

3.3 Shareholdings and Voting Rights
3.3.1 Shareholding Structure at the End of 2018
As of 31 December 2018, the French State held 11.06% of theoutstanding Company shares through Sogepa, the German
State held 11.04% through GZBV, a subsidiary of Kreditanstalt fürWiederaufbau (“KfW”), a public law institution serving domestic
and international policy objectives of the Government of theFederal Republic of Germany, and the Spanish State held 4.16%
through SEPI. The public (including the Company’s employees)

and the Company held, respectively, 73.66% and 0.08% of theCompany’s share capital.
The diagram below shows the ownership structure of theCompany as of 31 December 2018 (% of capital and of voting
rights (in parentheses) before exercise of the convertible bonds).
See “— Corporate Governance — 4.3.3 Long-Term Incentive
Plans”.

OWNERSHIP STRUCTURE OF AIRBUS SE AS OF 31 DECEMBER 2018

FRENCHSTATEGERMANSTATE

SPANISHSTATEOTHER GERMAN
PUBLIC ENTITIES

15.69%PUBLIC

KfW

84.31%

SOGEPASEPIGZBV(2)

11.06%(11.06%)

4.16%(4.16%)

11.04%(11.04%)73.74%(1)(73.72%)

Share subject to Shareholders’ Agreement

AIRBUS SE(1) Including shares held by the Company itself (0.08%).
(2) KfW & other German public entities.

According to the AFM register on substantial holdings, the below
listed entities have notified the AFM of their substantial interestin the Company:
Capital Research and Management Company (10.06% of
the voting rights);
Capital Group International Inc. (10.06% of the voting rights);
EuroPacific Growth Fund (3.02% of the capital interest);
BlackRock, Inc. (4.20% of the capital interest and 4.99% of
the voting rights).

----106

Airbus / Registration Document 2018

Actual interests may differ as the holder of a substantial interest
is only obliged to notify the AFM of any change in the percentageof share capital and/or voting rights if such holder, directly or
indirectly, reaches, exceeds or falls below any of the following
thresholds: 3%, 5%, 10%, 15%, 20%, 25%, 30%, 40%, 50%,
60%, 75% and 95%.
Except as described above, the Company is not aware of any
other person or legal entity that, as of the date of this RegistrationREGISTRATION DOCUMENT 2018
General Description of the Company and its Share Capital /3.3 Shareholdings and Voting Rights

Document, has a capital or voting interest in the Company of
3% or more. For further details, please refer to the website of
the AFM at: www.afm.nl.

For the number of shares and voting rights held by Membersof the Board of Directors and Executive Committee, see“— Corporate Governance — 4.2.1 Remuneration Policy”.

As of 31 December 2018, the Company held, directly or indirectly
through another company in which the Company holds directly
or indirectly more than 50% of the share capital, 636,924 of its
own shares, equal to 0.08% of issued share capital. The treasury
shares owned by the Company do not carry voting rights.

Approximately 2.0% of the share capital (and voting rights) was
held by the Company’s employees as of 31 December 2018.

3

3.3.2 Relationships with Principal Shareholders
In 2013, GZBV, Sogepa and SEPI entered into a shareholders’agreement (the “Shareholders’ Agreement”). The Shareholders’
Agreement, further details of which are set out in more detailbelow, does not give the parties to it any rights to designate
Members of the Board of Directors or management team or toparticipate in the governance of the Company. The Company
has also entered into state security agreements with each of
the French State and German State, which are also describedin more detail below.

3.3.2.1 Corporate Governance Arrangements
Corporate governance arrangements of the Company were
substantially changed in 2013, resulting in changes in thecomposition of the Board of Directors and its internal rules,
as well as amendments to the Articles of Association of theCompany. These changes were intended to further normalise
and simplify the Company’s corporate governance, reflecting
an emphasis on best corporate governance practices andthe absence of a controlling shareholder group. Changes to
the Company’s corporate governance arrangements in the
Articles of Association, included (i) disclosure obligations forshareholders that apply when their interests in the Company
reach or cross certain thresholds and (ii) ownership restrictions
prohibiting any shareholder from holding an interest of morethan 15% of the share capital or voting rights of the Company,
acting alone or in concert with others. See sections 3.1.11 and3.1.12 above and section 4 below.

3.3.2.2 Core Shareholder Arrangements
Grandfathering Agreement
At the Consummation, the French State, Sogepa, the German
State, KfW and GZBV (all parties together the “Parties” andeach, individually, as a “Party”) entered into an agreement withrespect to certain grandfathering rights under the Articles of
Association. Below is a summary of such agreement.
Individual Grandfathering Rights
A Party that is individually grandfathered pursuant to
Article 16.1.b of the Articles of Association (such Party holding“Individual Grandfathering Rights”) shall remain individually
grandfathered in accordance with the Articles of Association if
the new concert with respect to the Company (the “Concert”)
is subsequently terminated (for instance by terminating theShareholders’ Agreement) or if it exits the Concert.

Loss of Individual Grandfathering Rights
A Party holding Individual Grandfathering Rights as well as anyof its affiliates who are grandfathered pursuant to Article 16.1.b inconjunction with Article 16.3 of the Articles of Association (suchaffiliates holding “Derived Grandfathering Rights”, and theIndividual Grandfathering Rights and the Derived Grandfathering
Rights, together, the “Grandfathering Rights”) shall all nolonger be entitled to exercise their Grandfathering Rights inthe event:
the Concert is terminated as a result of it or any of its affiliates
having actually or constructively terminated such Concert; or
it or its relevant affiliate(s) exit(s) the Concert;---and such termination or exit is not for good cause and is
not based on material and ongoing violations of the Concert
arrangements, including, without limitation, of the Shareholders’
Agreement, by the other principal Member of the Concert.
In the event that in the future the voting rights in the Companyof the other principal Member of the Concert together withthose of its affiliates would for an uninterrupted period of threemonths represent less than 3% of the outstanding aggregate
voting rights of the Company, the Grandfathering Rights of theParty including its affiliates which were no longer entitled touse their Grandfathering Rights shall from then on revive andSogepa and GZBV shall jointly notify the Company to that effect.
Notification to the Company
The Company will not be required to take any of the actions
provided for in Article 15 of the Articles of Association pursuant
to the post-concert Grandfathering Agreement unless and until
it receives (i) a joint written instruction from Sogepa and GZBVwith respect to the taking of any of the actions provided for in
Article 15 of the Articles of Association pursuant to the postconcert Grandfathering Agreement, or (ii) a copy of a binding
advice rendered by three independent, impartial and neutral
Expert Adjudicators in order to settle any dispute between theParties arising out of or in connection with the post-concert
Grandfathering Agreement.
The Company will not incur any liability to any of the Parties bytaking such actions following receipt of any such joint instruction
or binding advice and the Company will not be required tointerpret the post-concert Grandfathering Agreement or any
such joint instruction or binding advice.
Notwithstanding the description under “Various provisions –Jurisdiction” below, the courts of the Netherlands will haveexclusive jurisdiction to resolve any dispute, controversy or
claim affecting the rights or obligations of the Company under
the post-concert Grandfathering Agreement.

Airbus / Registration Document 2018107

General Description of the Company and its Share Capital /3.3 Shareholdings and Voting Rights

Various Provisions
Termination. The post-concert Grandfathering Agreement
terminates only if either the French State and its affiliates or
the German State and its affiliates no longer hold shares in
the Company.
Governing law. Laws of the Netherlands.
Jurisdiction. The courts of the Netherlands shall have exclusive
jurisdiction. This is binding advice for any dispute, controversy
or claim arising out of or in connection with the post-concert
Grandfathering Agreement in accordance with the procedure set
forth in the post-concert Grandfathering Agreement; provided,
however, that application to the courts is permitted to resolve
any such dispute controversy or claim.
Shareholders’ Agreement
Below is a further description of the Shareholders’ Agreement,
based solely on a written summary of the main provisions of
the Shareholders’ Agreement that has been provided to theCompany by Sogepa, GZBV and SEPI (all parties together the“Shareholders”).
Governance of the Company
Appointment of the Directors. The shareholders shall votein favour of any draft resolution relating to the appointment
of Directors submitted to the shareholders’ meeting of theCompany in accordance with the terms and conditions of
the German State Security Agreement and the French State
Security Agreement (as described below). If, for whateverreason, any person to be appointed as a Director pursuant
to the German State Security Agreement or the French State
Security Agreement is not nominated, the shareholders shalluse their best endeavours so that such person is appointed
as a Director.
Sogepa and GZBV shall support the appointment of one
Spanish national that SEPI may present to them as Member ofthe Board of Directors of the Company, provided such person
qualifies as an Independent Director pursuant to the conditions
set forth in the Board Rules, and shall vote as shareholders inany shareholders’ meeting in favour of such appointment andagainst the appointment of any other person for such position.
If, for whatever reason, the French State Security Agreement
and/or the German State Security Agreement has / have been
terminated, KfW or Sogepa, as the case might be, shall propose
two persons, and the shareholders shall exercise their best
endeavours so that these persons are appointed as Directors.
Modification of the Articles of Association. Sogepa and
GZBV shall consult each other on any draft resolution intending
to modify the Board Rules and/or the Articles of Association.
Unless Sogepa and GZBV agree to vote in favour together ofsuch draft resolution, the shareholders shall vote against suchdraft resolution. If Sogepa and GZBV reach a mutual agreementon such draft resolution, the shareholders shall vote in favourof such draft resolution.
Reserved Matters. With respect to the matters requiring theapproval of a Qualified Majority at the Board level (“Reserved
Matters”), all the Directors shall be free to express their own

108

Airbus / Registration Document 2018

views. If the implementation of a Reserved Matter would requirea decision of the shareholders’ meeting of the Company, Sogepa
and GZBV shall consult each other with a view to reachinga common position. Should Sogepa and GZBV fail to reacha common position, Sogepa and GZBV shall remain free toexercise on a discretionary basis their votes.
Prior consultation. Sogepa and GZBV shall consult each otheron any draft resolution submitted to the shareholders’ meetingother than related to Reserved Matters and the Board Rules.
Balance of Interests
The shareholders agree their common objective to seek abalance between themselves of their respective interest in the
Company as follows:
to hold as closely as reasonably possible to 12% of the voting
rights for Sogepa, together with any voting rights attributable
to Sogepa and/or to the French State, pursuant to Dutch
takeover rules except for voting rights attributable due toacting in concert with the other parties;
to hold as closely as reasonably possible to 12% of the voting
rights for GZBV, together with any voting rights attributable to
GZBV and/or to the German State, pursuant to Dutch takeoverrules except for voting rights attributable due to acting inconcert with the other parties;
to hold as closely as reasonably possible to 4% of the voting
rights for SEPI, together with any voting rights attributable
to SEPI and/or to the Spanish State, pursuant to Dutch
takeover rules except for voting rights attributable due toacting in concert with the other parties.

----

Mandatory Takeover Threshold
The total aggregate voting rights of the shareholders shall always
represent less than 30% of the voting rights of the Company,or less than any other threshold the crossing of which would
trigger for any shareholder a mandatory takeover obligation(the “MTO Threshold”). In the event that the total aggregate
voting rights of the shareholders exceed the MTO Threshold,the shareholders shall take all appropriate actions as soon asreasonably practicable, but in any event within 30 days, to fall
below the MTO Threshold.
Transfer of Securities
Permitted transfer. Transfer of securities by any shareholder
to one of its affiliates.
Pre-emption right. Pro rata pre-emption rights of theshareholders in the event any shareholder intends to transfer
any of its securities to a third party directly or on the market.
Call-option right. Call option right for the benefit of theshareholders in the event that the share capital or the voting
rights of any shareholders cease to be majority owned directly or
indirectly by the French State, the German State or the Spanish
State as applicable.
Tag-along right. Tag-along right for the benefit of SEPI in theevent that Sogepa, the French State or any of their affiliates andany French public entity and GZBV, the German State or any of
their affiliates and any public entity propose together to transfer
all of their entire voting rights interests.

REGISTRATION DOCUMENT 2018
General Description of the Company and its Share Capital /3.3 Shareholdings and Voting Rights

Various Provisions
Termination. The Shareholders’ Agreement may cease to
apply in respect of one or more Shareholders and/or theiraffiliates, subject to the occurrence of certain changes in its
or their shareholding interest in the Company or in its or theirshareholders.
Governing law. Laws of the Netherlands.
Jurisdiction. Arbitration in accordance with the Rules ofArbitration of the International Chamber of Commerce, withthe seat of arbitration in The Hague (The Netherlands).

3.3.2.3 Undertakings with Respect to Certain
Interests of Certain Stakeholders
The Company has made certain undertakings and entered into
certain agreements in connection with certain interests of its
former core shareholders and the German State.
State Security Agreements and Related Undertakings
and Negotiations
The Company and the French State have entered into anamendment to the existing convention between the French
State and the Company relating to the ballistic missiles businessof the Company (as so amended, the “French State Security
Agreement”). Under the French State Security Agreement,
certain sensitive French military assets will be held by a Company
subsidiary (the “French Defence Holding Company”). At theConsummation, the Company contributed certain sensitive
French military assets to the French Defence Holding Company.
The French State has the right to approve or disapprove of —but not to propose or appoint — three outside Directors to theBoard of Directors of the French Defence Holding Company(the “French Defence Outside Directors”), at least two ofwhom must qualify as Independent Directors under the Board
Rules if they were Members of the Board of Directors. Two of
the French Defence Outside Directors are required to also be
Members of the Board of Directors. French Defence Outside
Directors may neither (i) be employees, managers or corporate
officers of a company belonging to the Company (although they
may be Members of the Board of Directors) nor (ii) have material
ongoing professional relationships with Airbus.
The Company and the German State have entered into anagreement relating to the protection of essential interests to
the German State’s security (the “German State Security
Agreement”). Under the German State Security Agreement,
certain sensitive German military assets are held by a Company

subsidiary (the “German Defence Holding Company”). The
German State has the right to approve or disapprove of — but
not to propose or appoint — three outside Directors to theSupervisory Board of the German Defence Holding Company(the “German Defence Outside Directors”), at least two ofwhom must qualify as Independent Directors under the Board
Rules if they were Members of the Board of Directors. Two of
the German Defence Outside Directors are required to also
be Members of the Board of Directors. The qualifications toserve as a German Defence Outside Director are comparable
to those to serve as a French Defence Outside Director, with theadditional requirement that a German Defence Outside Director
may not be a civil servant.
Dassault Aviation

3

The Company entered into an agreement with the French State
pursuant to which the Company:
grants the French State a right of first offer in case of thesale of all or part of its shareholding in Dassault Aviation; andcommits to consult with the French State prior to making any
decision at any shareholders’ meeting of Dassault Aviation.

---

For more information about Dassault Aviation, see “— Informationon the Company’s Activities — 1.1.5 Investments”.
Stock Exchange Listings
The Company has undertaken to the parties to the Shareholders’
Agreement that for the duration of the Shareholders’ Agreement
the Company’s shares will remain listed exclusively in France,
Germany and Spain.
Specific Rights of the French State
Pursuant to an agreement entered into between the Company
and the French State (the “Ballistic Missiles Agreement”),
the Company has granted to the French State (a) a veto rightand subsequently a call option on shares of the Company
performing the ballistic missiles activity exercisable undercertain circumstances, including if (i) a third party acquires,directly or indirectly, either alone or in concert, more than 15%
or any multiple thereof of the share capital or voting rights of
the Company or (ii) the sale of the shares of such companies
carrying out such activity is considered and (b) a right to oppose
the transfer of any such shares. The Company, the French Stateand the Company performing the ballistic missiles activity areparties to a similar convention regarding the assets comprising
the French nuclear airborne systems under which the French
State has similar rights.

3.3.3 Form of Shares
The shares of the Company are in registered form. The Boardof Directors may decide with respect to all or certain shares,
on shares in bearer form.
Shares shall be registered in the shareholders’ register without
the issue of a share certificate or, should the Board of Directors

so decide, with respect to all or certain shares, with the issue ofa certificate. Share certificates shall be issued in such form as
the Board of Directors may determine. Registered shares shallbe numbered in the manner to be determined by the Board of
Directors.

Airbus / Registration Document 2018109

General Description of the Company and its Share Capital /3.3 Shareholdings and Voting Rights

3.3.4 Changes in the Shareholding of the Company
The evolution in ownership of the share capital and voting rights of the Company over 2016, 2017 and for the three-month period
ended 31 March 2019 is set forth in the table below:
Position as of
31 March 2019

Position as of
31 December 2017

Position as of
31 December 2016

Shareholders% ofcapital% ofvotingrightsNumber ofshares% ofcapital% ofvotingrightsNumber ofshares% ofcapital% ofvotingrightsNumber ofsharesSOGEPA

11.06%

11.06%

85,835,477

11.08%

11.08%

85,835,477

11.11%

11.11%

85,835,477

GZBV(1)11.04%

11.04%

85,709,822

11.07%

11.07%

85,709,822

11.09%

11.09%

85,709,822

SEPI

4.16%

4.16%

32,330,381

4.17%

4.17%

32,330,381

4.18%

4.18%

32,330,381

26.26%

26.28%

203,875,680

26.32%

26.33%

203,875,680

26.38%

26.38%

203,875,680

Sub-total New
Shareholder Agt.
Foundation “SOGEPA”

0.00%

0.00%

0

0.00%

0.00%

-

0.00%

0.00%

0

Public(2)73.66%

73.72%

571,855,277

73.66%

73.67%

570,550,857

73.60%

73.62%

568,853,019-

636,9240.02%-

129,525

0.02%-

184,170

100% 776,367,881

100%

100% 774,556,062

100%

Own share buyback(3)

0.08%

Total

100%

100% 772,912,869(1) KfW & other German public entities.
(2) Including Company employees. As of 31 March 2019, the Company’s employees held approximately 2.0% of the share capital (and voting rights).
(3) The shares owned by the Company do not carry voting rights.

To the knowledge of the Company, there are no pledges overthe shares of the Company.
The Company requested disclosure of the identity of thebeneficial holders of its shares held by identifiable holders(“Titres au porteur identifiables”) holding 2,000 or more shares
each. The study, which was completed on 31 December 2018,
resulted in the identification of 1,820 shareholders holding a totalof 572,267,264 Company shares (including 1,837,087 shares
held by Iberclear on behalf of the Spanish markets and29,668,256 shares held by Clearstream on behalf of the Germanmarket).
The shareholding structure of the Company as of 31 December
2018 is as shown in the diagram in “— 3.3.1 Shareholding
Structure at the end of 2018”.

3.3.5 Persons Exercising Control over the Company
See “— 3.3.1 Shareholding Structure at the end of 2018” and “— 3.3.2 Relationships with Principal Shareholders”.

3.3.6 Simplified Group Structure Chart
The following chart illustrates the simplified organisational structure of Airbus as of 31 December 2018, comprising three Divisions
and the main Business Units. See “— Information on the Company’s Activities — 1.1.1 Overview — Organisation of the Company’s
Businesses”. For ease of presentation, certain intermediate holding companies have been omitted.

110

Airbus / Registration Document 2018

ArianeGroup50%*

Airbus Defence
and Space Holding
France SAS(France)

Computadoras,Redese Ingenieria, S.A.
(Spain)Airbus Defence
and Space, S.A.
(Spain)Subsidiaries held with no indication of ownership percentage are 100% owned.
* Indirectly
Legal forms are indicated for information purposes and are not always part of the legal name.

MBDA Group

Ariane Group

Airbus Helicopters

MBDA(France)

37.5%*

Airbus Defence
and Space SAS(France)

Airbus DS Holding
SAS(France)99.99%

4.04%

95.96%

Elbe
FlugzeugwerkeGmbH(Germany)

45%

Airbus Defence 11.98%
and Space GmbH
(Germany)

88.02%*

Airbus Defence and Space

Airbus Defence
and Space
Litmited(UK)

SIMPLIFIED GROUP STRUCTURE CHART

Airbus Operations
GmbH(Germany)

Airbus Operations
Limited(UK)

ATR GIE(France)

Stelia Aerospace(France)

AirbusOperations, S.L.
(Spain)50.01%*

Airbus SAS(France)

Airbus Operations
SAS(France)

4.22%*

95.78%C Series Aircraft
LimitedPartnership(Canada)(The Netherlands)

AIRBUS SE

50%*

Airbus Group
Inc.
(USA)

Airbus Americas
Inc.
(USA)

Premium Aerotec
GmbH(Germany)

4.96%*

Airbus Helicopters
España, S.A.
(Spain)Airbus Helicopters
UK Limited(UK)

Airbus Helicopters
DeutschlandGmbH(Germany)

Airbus Helicopters(France)98.04%REGISTRATION DOCUMENT 2018

General Description of the Company and its Share Capital /3.3 Shareholdings and Voting Rights

3

Airbus / Registration Document 2018111

General Description of the Company and its Share Capital /3.3 Shareholdings and Voting Rights

3.3.7 Purchase by the Company of its Own Shares
3.3.7.1

Dutch Law and Information on Share
Repurchase Programmes

Under Dutch civil law, the Company may acquire its own shares,
subject to certain provisions of the law of the Netherlands andthe Articles of Association, if (i) the shareholders’ equity less thepayment required to make the acquisition does not fall below
the sum of paid-up and called portion of the share capital andany reserves required by the law of the Netherlands and (ii) the
Company and its subsidiaries would not thereafter hold or holdin pledge shares with an aggregate nominal value exceeding
one-half (50%) of the Company’s issued share capital. Shareacquisitions may be effected by the Board of Directors only if
the shareholders’ meeting has authorised the Board of Directors
to effect such repurchases. Such authorisation may apply for a
maximum period of 18 months.
For the authorisations granted to the Board of Directors at
the AGM of Shareholders held on 11 April 2018, see “— 3.2.3
Modification of Share Capital or Rights Attached to the Shares”.

3.3.7.2

In addition, the Company must report to the competent authorityof each trading venue on which the shares are admitted to
trading or are traded no later than by the end of the seventh daily
market session following the date of execution of the transaction,
all the transactions relating to the buy-back programme andensure adequate disclosure of that certain information relating
thereto within the same time frame. These transactions must
be posted on the Company’s website and be made available tothe public for at least a 5-year period from the date of adequate
public disclosure.

French Regulations

As a result of its listing on a regulated market in France, theCompany is subject to the European regulations summarised
above in 3.3.7.2 (European Regulation).
In addition, the Autorité des marchés financiers (“AMF”)
General Regulations and AMF guidelines n°2017-04 define theconditions for a company’s trading in its own shares to bevalid in accordance with the Market Abuse Regulation and EU
Delegated Regulation no. 2016 / 1052.
Moreover, the Company must report to the AMF, on at least
a monthly basis, all the specified information regarding such
purchases previously published on its website and information
concerning the cancellation of such repurchased shares.

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Airbus / Registration Document 2018

German Regulations

As a foreign issuer, the Company is subject to German rules
on repurchasing its own shares only to a limited extent, sinceGerman rules refer to the law of the Member State in which theCompany is domiciled. In addition, general principles of German
law on equal treatment of shareholders are applicable.
The European regulations summarised above in 3.3.7.2(European Regulation) also applies to the Company in Germany.

3.3.7.5

Spanish Regulations

As a foreign issuer, the Company is not subject to Spanish
rules on trading in its own shares, which only apply to Spanish
issuers. The European regulations summarised above in 3.3.7.2(European Regulation) also applies to the Company in Spain.

3.3.7.6

European Regulation

Pursuant to the Market Abuse Regulation and EU DelegatedRegulation no. 2016/1052, the Company is subject to conditions
for share repurchase programmes and disclosure relating
thereto. In particular, prior to implementing the share repurchaseprogramme, the Company must ensure adequate disclosure of
the following information: the purpose of the programme, themaximum pecuniary amount allocated to the programme, themaximum number of shares to be acquired, and the durationof the programme.

3.3.7.3

3.3.7.4

Description of the Share Repurchase
Programme to be Authorised by the
Annual General Meeting of Shareholders
Held on 10 April 2019

Pursuant to Articles 241-2-I and 241-3 of the AMF General
Regulations, below is a description of the share repurchaseprogramme (“descriptif du programme”) to be implemented
by the Company:
date of the shareholders’ meeting to authorise the share
repurchase programme: 10 April 2019;intended use of the Airbus SE shares held by the Company
as of the date of this document: the owning of shares for the
performance of obligations related to employee share option
programmes or other allocations of shares to employees ofAirbus and Airbus’ companies;
purposes of the share repurchase programme to be
implemented by the Company (by order of decreasingpriority, without any effect on the actual order of use of
the repurchase authorisation, which will be determinedon a case-by-case basis by the Board of Directors basedon need):the reduction of share capital by cancellation of all or partof the repurchased shares, it being understood that the
repurchased shares shall not carry any voting or dividend
rights,the owning of shares for the performance of obligations
related to (i) debt financial instruments convertible into
Airbus SE shares, or (ii) employee share option programmes
or other allocations of shares to employees of Airbus andAirbus’ companies,
the purchase of shares for retention and subsequent use forexchange or payment in the framework of potential external
growth transactions, andthe liquidity or dynamism of the secondary market of the
Airbus SE shares carried out pursuant to a liquidity agreement
to be entered into with an independent investment services
provider in compliance with the decision of the AMF dated
1 October 2008 (as amended) related to approval of liquidity
agreements recognised as market practices by the AMF;

----

-----

REGISTRATION DOCUMENT 2018
General Description of the Company and its Share Capital /3.3 Shareholdings and Voting Rights--procedure:--maximum portion of the issued share capital that may be
repurchased by the Company: 10%,--maximum number of shares that may be repurchased by

the Company:77,636,788 shares, based on an issued sharecapital of 776,367,881 shares as of 13 February 2019,the amounts to be paid in consideration for the purchase of
the treasury shares must be, in accordance with applicable
Dutch law, a price per share not less than the nominal
value and not more than the higher of the price of the last
independent trade and the highest current independent bid
on the trading venues of the regulated market of the country
in which the purchase is carried out.
The Company undertakes to maintain at any time a sufficientnumber of shares in public hands to meet the thresholdsof Euronext,
shares may be bought or sold at any time (including during
a public offering) to the extent authorised by the stock
exchange regulations and by any means, including, without
limitation, by means of block trades and including the use of
options, combinations of derivative financial instruments or
the issue of securities giving rights in any way to Airbus SE
shares within the limits set out in this document.
The portion of shares repurchased through the use of blocktrades may amount to all the shares to be repurchased in
the context of this programme,------in addition, in the event that derivative financial instruments

are used, the Company will ensure that it does not use
mechanisms which would significantly increase the volatilityof the shares in particular in the context of call options,characteristics of the shares to be repurchased by theCompany: shares of Airbus SE, a company listed onEuronext Paris, on the regulierter Markt of the Frankfurt
Stock Exchange and on the Madrid, Bilbao, Barcelona andValencia Stock Exchanges,
maximum purchase price per share: € 100;
term of the share repurchase programme and othercharacteristics: this share repurchase programme shall bevalid until 11 October 2019 inclusive, i.e. the date of expiry of
the authorisation requested from the AGM of Shareholders
to be held on 11 April 2018.

----

3

As of the date of this document, the Company has not enteredinto any liquidity agreement with an independent investment
services provider in the context of the share repurchaseprogramme.
Share Repurchase Programme 2018
In February 2019, the Company started implementing a sharebuyback programme that was conferred by Board of Directors on
13 February 2019 following the authorisation by the Company’s
Annual General Meeting of shareholders on 11 April 2018. This
share buyback programme is reported in accordance with theMarket Abuse Regulation.

Airbus / Registration Document 2018113

General Description of the Company and its Share Capital /3.4 Dividends

3.4 Dividends
3.4.1 Dividends and Cash Distributions Paid
Cash distributions paid to the shareholders are set forth in the table below:
Financial year

Date of the cash distribution payment

Gross amount per share(1)Adjusted amount per share(22015

3 May 2016

€ 1.30€ 1.3142016

20 April 2017

€ 1.35€ 1.345

2017

18 April 2018

€ 1.50€ 1.4972018

17 April 2019

€ 1.65€ 1.65(1) Note: figures take into account the number of shares outstanding at the date of payment.
(2) Note: amounts per share adjusted to the current number of shares outstanding as of 31 March 2019.

3.4.2 Dividend Policy of the Company
In December 2013, the Company formalised a dividend policy demonstrating a strong commitment to shareholders’ returns. This
policy targets sustainable growth in the dividend within a payout ratio of 30%-40%.
Based on earnings per share (EPS) of € 3.94 and a net income of € 3,054 million, the Board of Directors proposed to the AGM
the payment to shareholders on 17 April 2019 of a dividend of € 1.65 per share (FY 2017: € 1.50). This value is at the upper end of
the dividend policy reflecting our strong 2018 achievements, including the positive evolution of the 2018 underlying performanceand our 2018 cash generation. It highlights our confidence in our future financial performance as well as ongoing commitment
towards sustained dividend growth and increasing shareholder returns.
The record date is 16 April 2019. This proposed dividend represents year-on-year dividend per share increase of 10%.

3.4.3 Unclaimed Dividends
Pursuant to the Articles of Association, the claim for payment of
a dividend or other distribution approved by the shareholders’meeting shall lapse five years after the day on which such claim
becomes due and payable. The claim for payment of interim

dividends shall lapse five years after the day on which the claim
for payment of the dividend against which the interim dividend
could be distributed becomes due and payable.

3.4.4 Taxation
The statements below represent a broad analysis of the current
tax laws of the Netherlands. The description is limited to thematerial tax implications for a holder of the Company’s shares(the “Shares”) who is not and is not deemed to be resident in
the Netherlands for any Dutch tax purposes (a “Non-Resident
Holder”). Certain categories of holders of the Company’s shares
may be subject to special rules which are not addressed below

114

Airbus / Registration Document 2018

and which may be substantially different from the general rules
described below. Investors who are in doubt as to their tax
position in the Netherlands and in their state of residence should
consult their professional advisors. Where the summary refers
to “the Netherlands” or “Netherlands” or “Dutch”, it refers only
to the European part of the Kingdom of the Netherlands.

REGISTRATION DOCUMENT 2018
General Description of the Company and its Share Capital /3.4 Dividends

Withholding Tax on Dividends
In general, a dividend distributed by the Company in respectof Shares will be subject to Dutch withholding tax at astatutory rate of 15%. Dividends include dividends in cash orin kind, deemed and constructive dividends, repayment ofpaid-in capital not recognised as capital for Dutch dividend
withholding tax purposes, and liquidation proceeds in excessof the average paid-in capital recognised as capital for Dutch
dividend withholding tax purposes. Stock dividends paid out of
the Company’s paid-in-share premium, recognised as capitalfor Dutch dividend withholding tax purposes, will not be subject
to this withholding tax.

Non-Resident Holder is an individual and such holder or--thea connected person to such holder (“verbonden persoon”)

has, directly or indirectly, a substantial interest (“aanmerkelijk
belang”) or a deemed substantial interest in the Company
which is not attributable to an enterprise; orthe income or capital gain qualifies as income frommiscellaneous activities (“belastbaar resultaat uit overigewerkzaamheden”) in the Netherlands as defined in the Dutch
Income Tax Act 2001 (“Wet inkomstenbelasting 2001”),
including without limitation, activities that exceed normal, active
portfolio management (normaal actief vermogensbeheer).

--

A Non-Resident Holder of Shares can be eligible for a partial orcomplete exemption or refund of all or a portion of the above
withholding tax pursuant to domestic rules or under a tax
convention that is in effect between the Netherlands and the
Non-Resident Holder’s country of residence for tax purposes.
The Netherlands has concluded such conventions with the
US, Canada, Switzerland, Japan, almost all European Union
Member States and other countries.

Generally, a Non-Resident Holder of Shares will not have asubstantial interest in the Company’s share capital, unless the
Non-Resident Holder, alone or together with certain related
persons holds, jointly or severally directly or indirectly, Sharesin the Company, or a right to acquire Shares in the Company
representing 5% or more of the Company’s total issued andoutstanding share capital or any class thereof. Generally, a
deemed substantial interest exists if all or part of a substantial
interest has been or is deemed to have been disposed of withapplication of a roll-over relief.

Withholding Tax on Sale or Other Dispositions ofSharesGift or Inheritance Taxes

Payments on the sale or other dispositions of Shares will not
be subject to Dutch withholding tax, unless the sale or otherdisposition is, or is deemed to be, made to the Company ora direct or indirect subsidiary of the Company. In principle,
a redemption or sale to the Company or a direct or indirect
subsidiary of the Company will be deemed to be a dividend
and will be subject to the rules set forth in “Withholding Tax on
Dividends” above.

Value Added Tax

Taxes on Income and Capital Gains
A Non-Resident Holder who receives dividends distributed by
the Company on Shares or who realises a capital gain derived
from Shares, will not be subject to Dutch taxation on income
or a capital gain unless:the income or capital gain is attributable to an enterpriseor part thereof which is either effectively managed in the
Netherlands or carried on through a permanent establishment(“vaste inrichting”) or permanent representative (“vaste
vertegenwoordiger”) taxable in the Netherlands and the holderof Shares derives profits from such enterprise (other than by
way of the holding of securities); or
the Non-Resident Holder is an entity and has, directly or
indirectly, a substantial interest (“aanmerkelijk belang”) ora deemed substantial interest in the Company and suchinterest is held by the Non-Resident Holder with the main
purpose of or one of the main purposes of avoiding personal
income tax for another person; or

--

--

3

Dutch gift or inheritance taxes will not be levied on the occasionof the transfer of Shares by way of gift by, or on the death of,a Non-Resident Holder, unless the transfer is construed as aninheritance or gift made by or on behalf of, a person who, at thetime of the gift or death, is or is deemed to be resident in the
Netherlands for the purpose of the relevant provisions.

There is no Dutch value added tax payable by a holder of Sharesin respect of dividends on the Shares or on the transfer of the
Shares.

Other Taxes and Duties
There is no Dutch registration tax, stamp duty or any other similar
tax or duty other than court fees payable in the Netherlands
by a holder of Shares in respect of or in connection with theexecution, delivery and/or enforcement by legal proceedings(including any foreign judgment in the courts of the Netherlands)
with respect to the dividends on the Shares or on the transferof the Shares.

Residence
A Non-Resident Holder will not become resident, or be deemed
to be resident, in the Netherlands solely as a result of holding
a Share or of the execution, performance, delivery and/or
enforcement of rights in respect of the Shares.

Airbus / Registration Document 2018

115

4
Chapter

116

Airbus / Registration Document 2018

4

Corporate Governance
4.1
Management and Control
4.1.1 Corporate Governance Arrangements
4.1.2 Dutch Corporate Governance Code,“Comply or Explain”
4.1.3 Enterprise Risk Management System
4.1.4 Internal Audit

118
118
137
138
139

4.2

Interests of Directors and Principal
Executive Officers140
4.2.1 Remuneration Policy
140
4.2.2 Long-Term Incentives Granted
to the Chief Executive Officer
152
4.2.3 Related Party Transactions
153
4.3
4.3.1
4.3.2
4.3.3

Employee Profit Sharing and Incentive Plans
Employee Profit Sharing and Incentive Agreements
Employee Share Ownership PlansLong-Term Incentive Plans

153
153
153
155

Airbus / Registration Document 2018117

Corporate Governance /4.1 Management and Control

4.1 Management and Control
The corporate governance arrangements of the Company were
substantially changed pursuant to the Multiparty Agreement,
including changes in the composition of the Board of Directors
and the rules governing its internal affairs (the “Board Rules”).
These changes are intended to further normalise and simplify

the Company’s corporate governance, reflecting an emphasis
on best corporate governance practices and the absence of acontrolling shareholder group. Below is a summary descriptionof such changes.

4.1.1 Corporate Governance Arrangements
4.1.1.1

Board of Directorsa) Composition Rules and Principles
Under the Articles of Association, the Board of Directors
consists of at most 12 Directors. Under the Board Rules, each
Board Director shall retire at the close of the AGM held three
years following his or her appointment, unless the said mandateis renewed. Under the Board Rules, at least a majority of theMembers of the Board of Directors (i.e. 7/12) must be European
Union (“EU”) nationals (including the Chairman of the Boardof Directors) and a majority of such majority (i.e. 4/7) must
be both EU nationals and residents. No Director may be an
active civil servant. The Board of Directors has one Executive
Director and 11 Non-Executive Directors. While the Board of
Directors appoints the Chief Executive Officer of the Company(the “CEO”), the CEO is required to be an Executive Director andmust be an EU national and resident; therefore it is anticipatedthat the Board of Directors will appoint as CEO the person
appointed by the shareholders as an Executive Director. At
least nine of the Non-Executive Directors must be “Independent
Directors” (including the Chairman of the Board of Directors).
Under the Board Rules, an “Independent Director” is a nonExecutive Director who is independent within the meaning of
the Dutch Corporate Governance Code (the “Dutch Code”) andmeets additional independence standards. Specifically, where
the Dutch Code would determine non-independence, in part,by reference to a Director’s relationships with shareholders who
own at least 10% of the Company, the Board Rules determine
such Director’s non-independence, in relevant part, by reference
to such Director’s relationships with shareholders who own
at least 5% of the Company. According to the criteria of the
Dutch Code and the Board Rules, all non-Executive Directors(including the Chairman) presently qualify as an “Independent
Director”.
The Remuneration, Nomination and Governance Committeeof the Board of Directors (the “RNGC”) is charged withrecommending to the Board of Directors the names of candidates
to succeed active Board Members after consultation with the
Chairman of the Board of Directors and the CEO.
The Board of Directors, deciding by simple majority vote,proposes individuals to the shareholders’ meeting of theCompany for appointment as Directors by the shareholders’meeting. No shareholder or group of shareholders, or any

118

Airbus / Registration Document 2018

other entity, has the right to propose, nominate or appoint any
Directors other than the rights available to all shareholders underDutch law.
In addition to the membership and composition rules describedabove, the RNGC, in recommending candidates for the Boardof Directors, and the Board of Directors in its resolutions
proposed to the shareholders’ meeting regarding the renewal
or appointment of Directors, are both required to apply thefollowing principles:the preference for the best candidate for the position;
the preference for gender diversity between equal profiles;
the maintenance of appropriate skills mix and geographicalexperience;
the maintenance, in respect of the number of Members of
the Board of Directors, of the observed balance among thenationalities of the candidates in respect of the location of
the main industrial centres of Airbus (in particular among thenationals of France, Germany, Spain and the United Kingdom,
where these main industrial centres are located); andat least a majority of the Members of the Board of Directors(i.e. 7/12) shall be EU nationals (including the Chairman), anda majority of such majority (i.e. 4/7) shall be both EU nationals
and residents.

-----

--

In accordance with these principles the Board of Directors shallcontinue to seek greater diversity with respect to gender, age,geography, education, profession and background.
In 2018, three new Members joined the Board of Directors,
Mr. Clamadieu, Mr. Chu and Mr. Obermann. Respectively,
with an industrial background, expertise in the Asian market
and information technology and entrepreneurial background,they have the competencies and personal skills to fulfil these
positions in line with the Board’s expectations and the evolutionof the Company’s business.
At the end of 2018 more than half of the Members of the Boardof Directors were aged 60 or under. The proportion of female
representatives is today at 25% against 0% six years ago. The
Board composition shows a balanced mix of experience with, forexample, five Members having aerospace industry skills, eight
having geopolitical or economics skills, five having information
or data management skills and five having manufacturing
and production skills. More details about the diversity of theMembers of the Board of Directors are available in the tableentitled Composition of the Board of Directors in 2018.

REGISTRATION DOCUMENT 2018
Corporate Governance /4.1 Management and Control

The Board of Directors is required to take into account, in the
resolutions proposed in respect of the nomination of Directors
presented to the shareholders’ meeting, the undertakings of
the Company to the French State pursuant to the amendment
to the French State Security Agreement and to the German
State pursuant to the German State Security Agreement, ineach case as described more fully in “3.3.2.3 — Undertakings
with Respect to Certain Interests of Certain Stakeholders”. In
practice, this means that at all times the Board of Directors
needs to have (i) two Directors who should also be French
Defence Outside Directors (as defined above) of the French
Defence Holding Company (as defined above) who have been
proposed by the Company and consented to by the French
State and (ii) two Directors who should also be German Defence
Outside Directors (as defined above) of the German Defence
Holding Company (as defined above) who have been proposedby the Company and consented to by the German State.
The RNGC endeavours to avoid a complete replacementof outgoing Directors by new candidates and draws up an
appointment and reappointment schedule for the Directors after
consultation with the Chairman and the CEO. In drawing up sucha schedule, the RNGC considers the continuity of companyspecific knowledge and experience within the Board of Directors,
also taking into account that a Director should at the time of his/her appointment or re-appointment not be older than 75 years
and ensuring that at least one third of Directors’ positions areeither renewed or replaced every year for a term of three years.
This is to avoid large block replacements of Directors at one
single AGM, with the corresponding loss of experience andintegration challenges, provided that exceptions to these rules
may be agreed by the Board of Directors if specific circumstances
provide an appropriate justification for such exceptions.
b) Role of the Board of Directors
Most Board of Directors’ decisions can be made by a simple
majority of the votes cast by the Directors (a “Simple Majority”),
but certain decisions must be made by a two-thirds majority(i.e. eight favourable votes) of votes cast by the Directors
regardless of whether they are present or represented in
respect of the decision (a “Qualified Majority”). In addition,
amendments to certain provisions of the Board Rules require
the unanimous approval of the Board of Directors, with no morethan one Director not being present or represented (including
provisions relating to nationality and residence requirementswith respect to Members of the Board of Directors and the
Executive Committee). However, no individual Director orclass of Directors has a veto right with respect to any Board of
Directors’ decisions.
The Board Rules specify that in addition to the Board of
Directors’ responsibilities under applicable law and the
Articles of Association, the Board of Directors is responsible
for certain enumerated categories of decisions. Under the
Articles of Association, the Board of Directors is responsible
for the management of the Company. Under the Board Rules,
the Board of Directors delegates the execution of the strategy
as approved by the Board of Directors and the day-to-day
management of the Company to the CEO, who, supported by
the Executive Committee, makes decisions with respect to the
management of the Company. However, the CEO should notenter into transactions that form part of the key responsibilitiesof the Board of Directors unless these transactions have been
approved by the Board of Directors.

Matters that require Board of Directors’ approval include among
others, the following items (by Simple Majority unless otherwise
noted):
approving any change in the nature and scope of the businessof the Company and Airbus;
debating and approving the overall strategy and the strategicplan of Airbus;
approving the operational business plan of Airbus (the“Business Plan”) and the yearly budget of Airbus (“Yearly
Budget”), including the plans for Investment, R&D, Employment,
Finance and, as far as applicable, major programmes;
nominating, suspending or revoking the Chairman of theBoard of Directors and the CEO (Qualified Majority);
approving of all of the Members of the Executive Committee
as proposed by the CEO and their service contracts and othercontractual matters in relation to the Executive Committee anddeciding upon the appointment and removal of the Secretary
to the Board of Directors on the basis of the recommendationof the RNGC;
approving the relocation of the headquarters of the principal
companies of Airbus and of the operational headquarters of
the Company (Qualified Majority);
approving decisions in connection with the location of new
industrial sites material to Airbus as a whole or the change ofthe location of existing activities that are material to Airbus;
approving decisions to invest and initiate programmes
financed by Airbus, acquisition, divestment or sale decisions,in each case for an amount in excess of € 300 million;
approving decisions to invest and initiate programmes
financed by Airbus, acquisition, divestment or sale decisions,in each case for an amount in excess of € 800 million (Qualified
Majority);
approving decisions to enter into and terminate strategic
alliances at the level of the Company or at the level of one ofits principal subsidiaries (Qualified Majority);
approving matters of shareholder policy, major actions or
major announcements to the capital markets; andapproving decisions in respect of other measures andbusiness of fundamental significance for Airbus or which
involves an abnormal level of risk.

---------

4------The Board of Directors must have a certain number of Directors
present or represented at a meeting to take action. This quorum
requirement depends on the action to be taken. For the Boardof Directors to make a decision on a Simple Majority matter,a majority of the Directors must be present or represented.
For the Board of Directors to make a decision on a Qualified
Majority matter, at least 10 of the Directors must be present or
represented. If the Board of Directors cannot act on a Qualified
Majority Matter because this quorum is not satisfied, the quorum
would decrease to eight of the Directors at a new duly calledmeeting.
In addition, the Board Rules detail the rights and duties ofthe Members of the Board of Directors and sets out the core
principles which each and every Member of the Board of
Directors shall comply and shall be bound by, such as acting in
the best interest of the Company and its stakeholders, devoting
necessary time and attention to the carrying out of his/her duties
and avoiding any and all conflicts of interest.

Airbus / Registration Document 2018119

Corporate Governance /4.1 Management and Controlc) The Board of Directors(i) Composition of the Board of Directors as per AGM 2019AIRBUS SE BOARD OF DIRECTORS
Board member
Age*, Gender, Nationality

StatusSince

Term Primary occupation
expires & Other mandates

Denis
RANQUE67, M, French

2013,
Independent last re-election 2020
in 2017

Chairman of the Boardof Directors of Airbus SE

Guillaume
FAURY
51, M, French

Executive

Director expertiseBoard
attendanceCommittee attendance
Audit

11/11

2022

Chief Executive Officer
of Airbus SE

1/1
(from
AGM 2019)

VictorCHU
Independent 201861, M, Chinese /British2021

Chairman and CEO
of First Eastern
Investment Group

2/3
6/9
(from
(from
AGM 2018) AGM 2018)2021

CEO and member ofthe Board of Solvay SA(until 1 March 2019) and
Chairman of the Boardof Engie and memberof the Board of AXA SA

8/9
(from
AGM 2018)

Independent 2018  

Ralph D.
2013,
Member of the Board
CROSBY, Jr.
Independent last re-election 2020 of Directors of American
Electric Power Corp.
in 201771, M, American

9/10

2020

Co-Founder andChairman of Drayson
Technologies Ltd and
Co-Founder and CEO
of Sensyne Health PLC

8/10

2016,
Independent last re-election 2022
in 2019

Chairwoman and Chief
Executive Officer
of RATP and memberof the Board of Engie

10/10

Lord DRAYSON
Paul
Independent 201759, M, British
Catherine
GUILLOUARD
54, F, French

Hermann-Josef
2007,
Member of the
LAMBERTI
Independent last re-election 2020 Supervisory Boardof ING Group N.V.
in 201763, M, German

8/10

AmparoMORALEDA
54, F, Spanish

2015,
Independent last re-election 2021
in 2018

Member of the Boardof Directors of Solvay SA,
CaixaBank SA
and Vodafone PLC

9/10

Claudia
NEMAT
50, F, German

2016,
Independent last re-election 2022
in 2019

Member of the Boardof Management of
Deutsche Telekom AG

10/10

2021

Managing Directorof Warburg Pincus
Deutschland GmbH andmember of the Board of
Telenor ASA and Allianz
Deutschland AG

2016,
Independent last re-election 2022
in 2019

Chairman of theManaging Board of
Peugeot SA
and member of the Boardof Directors of Total SA

René
OBERMANN Independent 201856, M, German
CarlosTAVARES60, M,
Portuguese

ECC

10/10

2019

Jean-Pierre
CLAMADIEU
60, M, French

RNGC

6/7
(from
AGM 2018)

4/5

8/9

7/8
(from
AGM 2018)

5/5

11/11

10/11

4/5

9/9

10/11

5/7
2/2
(from
(until
AGM 2018) AGM 2018)

3/3
8/9
(from
(from
AGM 2018) AGM 2018)

6/10

Board and committee meetings in 2018

10

5

9

11

Average attendance rate in 2018

87%

88%

89%

93%

* As per AGM 2019 Date.
Independent
Executive
Chair
The professional address of all Members of the Board of Directors for any matter relating to Airbus SE is Mendelweg 30, 2333 CS Leiden, The Netherlands.

GlobalBusiness

120

Engineering& Technology

Manufacturing& Production

Airbus / Registration Document 2018

AerospaceIndustry

Finance& Audit

Geopolitical
Economics

DefenceIndustry

Information & DataManagement

Asia

REGISTRATION DOCUMENT 2018
Corporate Governance /4.1 Management and Control

The Company has not appointed observers to the Board of Directors. Pursuant to applicable Dutch law, the employees are notentitled to elect a Director. There is no minimum number of shares that must be held by a Director.
(ii) Curriculum Vitae and other Mandates and Duties Performed in any Company by the Membersof the Board of Directors as per AGM 2019
The Company has not appointed observers to the Board of Directors. Pursuant to applicable Dutch law, the employees are notentitled to elect a Director. There is no minimum number of shares that must be held by a Director.

Denis Ranque

67 years old
Director since 2013,
re-elected in 2017
Independent

Curriculum Vitae
Denis Ranque began his career at the French Ministry for Industry, where he held various positions in
the energy sector, before joining the Thomson group in 1983 as Planning Director. The following year,
he moved to the electron tubes division, first as Director of space business, then, from 1986, as Directorof the division’s microwave tubes department. Two years later, the electron tubes division became theaffiliate Thomson Tubes Electroniques, and Denis Ranque took over as Chief Executive of this subsidiaryin 1989. In April 1992, he was appointed Chairman and CEO of Thomson Sintra Activités Sous-marines.
Four years later, he became CEO of Thomson Marconi Sonar, the sonar systems joint venture set upby Thomson-CSF and GEC-Marconi. In January 1998, Denis Ranque was appointed Chairman andChief Executive Officer of the Thomson-CSF group, now called Thales. He resigned from this positionin May 2009, as a consequence of a change in shareholding. From February 2010 to June 2012 hehas been Non-Executive Chairman of Technicolor. Since October 2001, he has also been Chairman of
the Board of the École des Mines ParisTech, and since September 2002, Chairman of the Cercle del’Industrie, an association which unites France’s biggest industrial companies; both mandates ended inJune 2012. He is member of the Boards of Directors of Saint-Gobain and CMA-CGM. From 2013 to 2017,
he chaired The Haut Comité de Gouvernement d’Entreprise, the independent body put in place by the
French Code of corporate governance for monitoring and encouraging progress in this field. From 2014
to 2017, he has also been co-Chairman of La Fabrique de l’industrie, a think tank dedicated to industry.
Since 2014, he is the Chairman of the Fondation de l’École Polytechnique and a member of the French
Academy for Technologies (“Académie des Technologies”). Denis Ranque, born 1952, is a graduate ofFrance’s École Polytechnique and the Corps des Mines.

4

Current Mandates:-- Chairman of the Board of Directors of Airbus SE;-- Member of the Board of Directors of Saint Gobain;-- Member of the Board of Directors of CMA-CGM;-- President of the Board of Foundation de l’École Polytechnique.
Former mandates for the last five years:-- President of the French Haut Comité de Gouvernement d’Entreprise (until December 2017);-- Co-Chairman of the Board of Directors of La Fabrique de l’industrie (until November 2017).
-- Member of the Board of Directors of Scilab Enterprise SAS (until February 2017);

Airbus / Registration Document 2018121

Corporate Governance /4.1 Management and Control

Guillaume Faury

51 years old
Director since 2019
Executive

Curriculum Vitae
Guillaume Faury was appointed Airbus Chief Executive Officer (CEO) in April 2019 and leads the Company’s
Executive Committee. He was previously President of Airbus’ commercial aircraft business, a role he had
held since February 2018.
Prior to this, Guillaume was Chief Executive Officer of Airbus Helicopters (2013-2018), where hisachievements included restructuring its manufacturing system and introducing new technologies.
Before that, he enjoyed a four-year spell in the car industry at Peugeot (2009-2013), the French automotive
manufacturer, rising to become the Executive Vice-President for Research and Development and amember of the company’s management board. He presided over significant advances in Peugeot’s
lower-emissions hybrid-engine technology and the overhaul of the company’s product range, among
other accomplishments.
Between 1998 and 2008, he held various leadership positions in engineering, programmes and flight testingin Airbus’ helicopter business, which at the time operated under the name of Eurocopter. He became
Executive-Vice President for Programmes and a member of the Eurocopter Executive Committee, before
being appointed as Executive Director for Research and Development.
Guillaume began his career in 1992 as a flight-test engineer for the Eurocopter Tiger helicopter in the
Direction Générale de l’Armement (DGA), the French government agency responsible for the development
and purchase of defence systems for the French armed forces.
He graduated from the École polytechnique in Paris in 1990 and, subsequently, from the École nationalesupérieure de l’aéronautique et de l’espace in Toulouse.
Guillaume’s love of flying and aviation dates back to his childhood. He is a qualified light-aircraft pilot andhelicopter flight-test engineer with 1,300 hours of flying experience.
He was born in 1968 in Cherbourg, Normandy, and is married with three children.
Current Mandates:-- Chief Executive Officer of Airbus SE;-- Member of the Board of Directors of Airbus SE;-- Member of the Executive Committee of Airbus SE;
Former mandates for the last five years:/

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Victor Chu

61 years old
Director since 2018
Independent

Curriculum Vitae
Victor Chu graduated as a lawyer in London. He was admitted to practice law in England and Hong Kong.
After completing his training with Herbert Smith, the City law firm, Victor moved back to Hong Kong in 1982
with Herbert Smith. He has since handled a wide array of mandates in the field of corporate, commercial
and securities law, with special emphasis on China and regional investment transactions. In late 1985,
he founded Victor Chu & Co., which has become one of the leading law firms in Hong Kong.
In 1988, Victor Chu created the First Eastern Investment Group, a Hong Kong based international investment
firm. First Eastern specializes in private equity investments, venture capital investments and investmentsin the expansion stage of business development. Victor Chu was part of the first wave of specialists in the
Chinese market. He penetrated China early and built a lot of relationships at the highest level in the country.
Victor Chu has been instrumental in gaining the confidence of major international investors and institutions
ready to co-invest with First Eastern Investment Group. Key projects have included toll roads, water
treatment operations, property and manufacturing industries and FinTech, as well as the launch of Japanesebudget airline Peach Aviation.
Victor Chu is an extremely respected business figure in Hong Kong and Asia. In addition to his businessactivities, he has been very active with several international institutions such as The World Economic
Forum and The Royal Institute of International Affairs. He is also a generous philanthropist in the field ofenvironmental protection (Global Ocean Commission, WWF) and education.
Current Mandates:-- Member of the Board of Directors of Airbus SE;-- Chairman and CEO of First Eastern Investment Group;-- Member of the Borad of China Merchants China Direct;-- Member of the Board of Grand Harbour Marina PLC;-- Member of the Board of Camper & Nicholsons Marina Investments;-- Member of the Board of SE Securities;-- Member of the Board of Peach Aviation;-- Member of the Board of Evolution Securities Asia;-- Member of the Board of Sustainable Development Capital;-- Co-Chair of the International Business Council (by World Economic Forum);-- Senior Partner of Victor Chu & Co.

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Former mandates for the last five years:-- Member of the Foundation Board of World Economic Forum (until August 2015);-- Member of the Board of Zurich Insurance Co. (until April 2014).

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Jean-Pierre Clamadieu

60 years old
Director since 2018
Independent

Curriculum Vitae
Jean-Pierre Clamadieu graduated from École Nationale Supérieure des Mines de Paris before becoming
Chief Engineer of the Corps of Mines. Between 1981 and 1993, he worked mainly for the French Ministryof lndustry and as Technical Advisor to the Minister of Labor.
In 1993, Jean-Pierre Clamadieu joined RhônePoulenc to develop new activities in the field of automobile
pollution control. ln the following years, he held several executive positions in the Rhodia group, as
President of Rhodia’s Chemicals in Latin America, President of Rhodia Eco Services, Senior Vice President
for Rhodia Corporate Purchasing, President of Rhodia Organic Fine Chemicals division and President ofRhodia Pharmaceuticals & Agrochemicals division.
In October 2003, Mr Clamadieu was appointed CEO of Rhodia, and became its chairman & CEO in
March 2008. Following a merger between Rhodia and the Belgian chemical group Solvay in 2011,
Mr Clamadieu was appointed chairman of the Executive Committee and CEO of the new Solvay group.
Since his appointment, Jean-Pierre Clamadieu led the integration of the new group and its transformation
into a major player in the field of specialty chemicals and advanced materials, which combines industrial
competitiveness with the quest for sustainable solutions for its clients. His mandate at Solvay SA ends
on 1 March 2019.
Mr Clamadieu has been appointed Chairman of the Board of Directors of Engie in May 2018.
Jean-Pierre Clamadieu also promotes an ambitious and coordinated European energy policy.
Current Mandates:-- Member of the Board of Directors of Airbus SE;-- Chairman of the Executive Committee and CEO of Solvay SA;-- Chairman of the Board of Engie;-- Member of the Board of Directors of AXA;-- Member of the Board of Solvay Specialty Chemicals Asia Pacific Pte. Ltd (Singapore);-- Director of Cytec Industries Inc.;-- Director Cytec UK Holding Inc.;-- Chairman of the Board of Opéra National de Paris.
Former mandates for the last five years:-- Member of the Board of Solvay Finances SA (Luxembourg) (until March 2018);-- Member of the Board of Faurecia SA (France) (until February 2018);-- Member of the Board of (Solvay Iberica S.L. (Spain) (until September 2015);-- Member of the Board of Directors of AXA (until September 2015);-- Member of the Board of Solvay America, Inc. (USA) (until January 2014).

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Ralph Dozier Crosby, Jr.

71 years old
Director since 2013,
Re-elected in 2017
Independent

Curriculum Vitae
Ralph Crosby was Member of the Executive Committee of EADS from 2002-2012 and served as Chairman
and CEO of EADS North America from 2002-2009. He presently serves as an Independent Director of
American Electric Power headquartered in Columbus, Ohio, where he chairs the Human Resources
Committee and Excelitas Holdings, LP, headquartered in Boston. Prior to joining EADS, Mr Crosby wasan Executive with Northrop Grumman Corporation, where he had served as a Member of the Corporate
Policy Council with positions including President of the Integrated Systems Sector, Corporate Vice President
and General Manager of the company’s Commercial Aircraft Division and Corporate Vice President andGeneral Manager of the B-2 Division. Prior to his industry career, Mr Crosby served as an officer in the
U.S. Army, where his last military assignment was as military staff assistant to the Vice President of theUnited States. Mr Crosby is a graduate of the US Military Academy at West Point, and holds Master’s
degrees from Harvard University, and the University of Geneva, Switzerland. He is the recipient of theJames Forrestal Award from the National Defense Industrial Association, and has been awarded Chevalierof the Légion d’Honneur of France.
Current Mandates:-- Member of the Board of Directors of Airbus SE;-- Member of the Board of Directors (Supervisory Board) of American Electric Power Corporation;-- Member of the Board of Directors of Excelitas Holdings, LP.

4

Former mandates for the last five years:-- Member of the Board of Directors and of the Executive Committee of the Atlantic Council of theUnited States (until August 2018);-- Member of the Board of Directors (Supervisory Board) of Serco Group plc (until June 2017).

(Paul) Lord Drayson

59 years old
Director since 2017
Independent

Curriculum Vitae
Lord Drayson graduated as an engineer and finished his PhD in 1985 at Aston University. In 1987
he became Managing Director of The Lambourn Food Company Limited, a subsidiary of the TreborGroup and, after a management buy-out of the Company in 1989, completed its sale to a third party
in 1991. The same year, he founded Genisys Development Limited, a consultancy company for new
products development and management. In 1993, he co-founded PowderJect Pharmaceuticals Plc andled its business as Chairman and CEO until it was sold to Chiron Corporation, a US company, in 2003.
He co-founded Drayson Racing Technologies LLP in 2007 and, in 2014 he set up Drayson Technologies
Ltd, an Internet of Things platform company of which he currently is the co-founder, Chairman and CEO.
Lord Drayson was also elected chairman of the U.K. BioIndustry Association in 2001 and was appointed
to the House of Lords and a Member of the Science and Technology Committee of the House of Lords
in 2004. He was then appointed Parliamentary under Secretary of State for Defence Procurement in2005 and became Minister of State for Defence Equipment & Support in 2006 and Minister of State for
Science & Innovation in 2008.
Current Mandates:-- Member of the Board of Directors of Airbus SE;-- Chairman and CEO of Drayson Technologies Ltd;-- Co-Founder and CEO of Sensyne Health plc;-- Science Entrepreneur in Residence of Magdalen College, Oxford;-- Supernumerary Fellow of St. John’s College, Oxford;-- Member of Her Majesty’s Privy Council;-- Member of House of Lords;-- Co-founder and Trustee of the Drayson Foundation.
Former mandates for the last five years:-- Member of Project of the “Oxfordshire Innovation Engine” Project (until February 2018);-- Trustee and External Member of Council at University of Oxford (until December 2017);-- Chairman of the Executive Committee at OUC (Oxford University Clinic) Centres of Excellence LLP(until December 2017);-- Non-Executive Director and Board Member of the Royal Navy (until November 2017);-- President of the Motorsports Industry Association (until October 2015);-- Co-founder and Managing Partner Drayson Racing Technologies LLP (until April 2014).

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Catherine Guillouard

54 years old
Director since 2016
Independent

Curriculum Vitae
Catherine Guillouard began her career in 1993 at the Ministry of Economy in the French Treasury working
for the department in charge of the Africa – CFA zone and later in the Banking Affairs Department.
She joined Air France in 1997 as IPO Senior Project Manager. She was subsequently appointed Deputy
Vice-President Finance Controlling in 1999, Senior Vice-President of Flight Operations in 2001, Senior
Vice-President of Human Resources and Change Management in 2003 and Senior Vice-President of
Finance in 2005. In September 2007, she joined Eutelsat as Chief Financial Officer and member of theGroup Executive Committee. Catherine joined Rexel in April 2013 as Chief Financial Officer and Group
Senior Vice-President. Between May 2014 and February 2017 she has been Deputy Chief Executive
Officer of Rexel. On 2 August 2017, Ms Guillouard was appointed Chariwoman and Chief Executive Officer
of RATP Group, the fifth largest urban transportation operator in the world with nearly 16 million daily
passengers in 14 countries and 4 continents, a workforce of nearly 61,000 employees worldwide and arevenue of € 5,5bn in 2017. She is also Vis-President of Systra’s supervisory board, the RATP Group and
SNCF joint engineering subsidiary. Catherine Guillouard, born in 1965, is a graduate of the Institute of
Political Studies of Paris and the École Nationale d’Administration and she has a PhD of European laws
(Panthéon-Sorbonne).
Current Mandates:-- Member of the Board of Directors of Airbus SE;-- Member of the Board of Directors of ENGIE;-- Chairwoman and Chief Executive Officer of RATP Group;-- Chairwoman of the Supervisory Board of RATP Group;-- Vice-Chairwoman of the Supervisory Board of Systra.
Former mandates for the last five years:-- Deputy Chief Executive Officer of Rexel (until February 2017);

Hermann-Josef Lamberti
Hermann-Josef Lamberti was Member of the Management Board of Deutsche Bank AG from 1999
until 2012 and operated as the bank’s Chief Operating Officer. As COO he had global responsibility for
Human Resources, Information Technology, Operations and Process Management, Building and Facilities
Management as well as Purchasing. He joined Deutsche Bank in Frankfurt in 1998 as Executive Vice
President. From 1985, he held various management positions within IBM, working in Europe and the UnitedStates, in the fields of controlling, internal application development, sales, personal software, marketingand brand management. In 1997, he was appointed Chairman of the Management of IBM Germany.
Mr Lamberti started his career in 1982 with Touche Ross in Toronto, before joining the Chemical Bank inFrankfurt. He studied Business Administration at the Universities of Cologne and Dublin, and graduatedwith a Master’s degree.
63 years old
Director since 2007,
last re-elected in 2017
Independent

Current Mandates:-- Member of the Board of Directors of Airbus SE;-- Member of the Board of Trustees of Institute for Law and Finance Frankfurt;-- Member of the Advisory Board of Wirtschaftsinitiative FrankfurtRheinMain e.V.;-- Member of the Board of Trustees of Johann Wolfgang Goethe-Universität Fachbereich
Wirtschaftswissenschaften;-- Member of the Board of Trustees of Frankfurt Institute for Advanced Studies (FIAS) of
Goethe‑Universität;-- Member of the Supervisory Board of ING Group N.V.;-- Senior Business Advisor of Advent International GmbH;-- Owner / Managing Director of Frankfurt Technology Management GmbH;-- Chairman of the Supervisory Board of Addiko Bank AG.
Former mandates for the last five years:-- Member of the Board of LDM – Lefdal Data Mine, AS, Maloy, Norway (until December 2017);-- Member of the Board of Stonebranch INC., Alpharetta, Georgia, USA (until June 2017);-- Member of the Supervisory Board Open-Xchange AG (until June 2016);-- Member of the Advisory Board of Barmenia Versicherungen Wuppertal (until December 2014).

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María Amparo Moraleda Martínez

54 years old
Director since 2015,
last re-election in2018
Independent

Curriculum Vitae
Amparo Moraleda graduated as an industrial engineer from the ICAI (Escuela Técnica Superior de Ingeniería
Industrial) Madrid and holdsa PDG from IESE Business School in Madrid. Between January 2009 andFebruary 2012, she was Chief Operating Officer of Iberdrola SA’s International Division with responsibility
for the United Kingdom and the United States. She also headed Iberdrola Engineering and Construction
from January 2009 to January 2011. Previously, she served as General Manager of IBM Spain andPortugal (2001-2009). In 2005 her area of responsibility was extended to encompass Greece, Israel
and Turkey as well. Between 2000 and 2001, she was executive assistant to the chairman and CEO of
IBM Corporation. From 1998 to 2000, Ms Moraleda was General Manager of INSA (a subsidiary of IBM
Global Services). From 1995 to 1997, she was HR Director for EMEA at IBM Global Services and from1988 to 1995 held various professional and management positions at IBM España. Ms Moraleda is also amember of various boards and trusts of different institutions and bodies. She is member of the academyof “Ciencias Sociales y del Medio Ambiente” of Andalucía (Spain), member of the board of trustees of MD
Anderson Cancer Centre in Madrid, CurArte Foundation in Madrid, member of the International Advisory
Board of Instituto de Empresa Business School and member of the Board of the global alumni associationof IESE Business School.
In May 2017 she was inducted as a member of the Spanish Royal Academy of Economic and Financial
Sciences.
Current Mandates:-- Member of the Board of Directors of AirbusSE;-- Member of the Board of Directors of Vodafone plc;-- Member of the Board of Directors of Solvay SA;-- Member of the Board of Directors of Caixabank SA;-- Member of the Supervisory Board of CSIC (Consejo Superior d’Investigaciones Cientificas);-- Member of the Advisory Board of SAP Spain;-- Member of the Advisory Board of Spencer Stuart Spain.

4

Former mandates for the last five years:-- Member of the Board of Directors of Faurecia SA (until October 2017);-- Member of the Advisory Board of KPMG Spain (until June 2017);-- Member of the Board of Directors of Meliá Hotels International SA (until June 2015);-- Member of the Board of Directors of Alstom SA (until June 2015);-- Member of the Board of Corporación Financiera Alba SA (until May 2015).

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Claudia Nemat

50 years old
Director since 2016
Independent

Curriculum Vitae
Born in 1968, Claudia Nemat has been a member of the Board of Management of Deutsche Telekom AG
since October 2011. Mrs. Nemat led the European business of DT until the end of 2016. Since January 2017she has led the new Board area Technology & Innovation.
Before joining Deutsche Telekom AG, Claudia Nemat spent 17 years working for McKinsey & Company
where she was elected Partner in 2000, and Senior Partner (“Director”) in 2006. Among other responsibilities
during her time there, she was Co-leader of the global Technology Sector and managed it in the EMEA
economic region.
She focuses on digital transformation, the impact of new technologies such as artificial intelligence on
business models, our work and lives, complex stakeholder management, and leading global teams. Mrs.
Nemat has worked in numerous European countries as well as North and South America. She was amember of the Supervisory Board of Lanxess AG and she has been a member of the Board of Directorsof Airbus since 2016.
Claudia Nemat studied physics at University of Cologne and taught at the Institute of Mathematics andTheoretical Physics.
Current Mandates:-- Member of the Board of Directors of Airbus SE;-- Member of the Board of Directors of Airbus Defence and Space GmbH;-- Member of the Management Board of Deutsche Telekom AG;-- Chairperson of the Supervisory Board of Deutsche Telekom IT GmbH (related to Deutsche Telekom);-- Member of the University Council of University of Cologne.
Former mandates for the last five years:-- Chairperson and Member of the Board of Buyln (related to Deutsche Telekom) (until January 2017);-- Member of the Board of OTE (related to Deutsche Telekom) (until January 2017);-- Member of the Supervisory Board of LANXESS AG (until May 2016);-- Director of EE Limited (UK) (related to Deutsche Telekom) (until 2014).

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René Obermann

56 years old
Director since 2018
Independent

Curriculum Vitae
In February 2015 René Obermann joined Warburg Pincus, a leading private equity firm, as a Partner andManaging Director. Subsequent to investments made by Warburg Pincus, he assumed roles as Chairmanof the Board at 1&1 Internet Holding SE and Non-Executive Director of inexio KGaA. Furthermore, heserves on the boards of Allianz Deutschland AG, Telenor ASA and ThyssenKrupp AG, and is a memberof the Editorial Board of DIE ZEIT.
René worked as CEO of Ziggo B.V. in The Netherlands in 2014 until the merger with LibertyGlobal’s UPC
in November. Prior to Ziggo, René worked at Deutsche Telekom Group (DT) from 1998 until 2013. Afterrunning DT’s mobile division (T-Mobile International), he was appointed as CEO of Deutsche Telekom AG
in November 2006, where he remained until December 2013.
René began his career with a business traineeship at BMW AG in Munich. Next, he founded his own
business in Münster in 1986: ABC Telekom, a company marketing and distributing telecommunicationequipment and providing technical services. After the acquisition of ABC Telekom by Hutchison Whampoa
in 1991, René became Managing Partner of the resulting company: Hutchison Mobilfunk GmbH. Between
1993 and 1998, he was CEO of that company.
From 2007-2013, Rene also served as Vice President of the German Association for Information Technology,
Telecommunications and New Media (BITKOM).
Current Mandates:-- Member of the Board of Directors of Airbus SE;-- Managing Director of Warburg Pincus Deutschland GmbH;-- Member of the Board of Directors of Telenor ASA;-- Member of the Board of Directors of Allianz Deutschland AG;-- Chairman of the Board of Directors of 1&1 Internet Holding SE;-- Member of the Board of Directors of Inexio Informationstechnologie und Telekommunikation KGaA.

4

Former mandates for the last five years:-- Member of the Board of Directors of ThyssenKrupp AG (until August 2018);-- Member of the Board of Directors of Compu Group Medical SE (until December 2017);-- Member of the Board of Directors of Spotify Technology SA (until July 2016);-- Member of the Board of Directors of E.ON (until June 2016).

Carlos Tavares
Curriculum Vitae
Carlos Tavares is a graduate of École Centrale Paris. He held a number of different positions with the
Renault Group from 1981 to 2004 before joining Nissan. In 2009, he was appointed Executive Vice
President, Chairman of the Management Committee Americas and President of Nissan North America.
He was named Group Chief Operating Officer of Renault in 2011. Since 1 January 2014, he has joined
the Managing Board of PSA Peugeot Citroën. He was named Chairman of the Managing Board since
31 March 2014.

60 years old
Director since 2016
Independent

Current Mandates:-- Member of the Board of Directors of Airbus SE;-- Director of Banque PSA Finance;-- Chairman of the Board of Directors of Peugeot Citroën Automobiles SA;-- Member of the Board of Directors of Total Group SA.
Former mandates for the last five years:-- Director of Faurecia SA (until October 2018);-- Manager of Bed&Breakfast in Lisbon (until March 2015);-- Director of PCMA Holding B.V. (until October 2014).

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REPLACEMENTS OF BOARD MEMBERS IN THE COURSE OF 2018
Until AGM 2018

From AGM 2018*

Name

Age

StatusName

Age

StatusMr. Hans-Peter KEITEL

70

Independent

Mr. René OBERMANN

55

Independent

Sir John PARKER

75

Independent

Mr. Victor CHU

60

Independent

Mr. Jean-Claude TRICHET

75

Independent

Mr. Jean-Pierre CLAMADIEU

59

Independent* Further information on the Board members can be found in the above table “Composition of the Board of Directors in 2018”.

REPLACEMENTS OF BOARD MEMBERS DURING AGM 2019
Until AGM 2019

From AGM 2019

Name

Age

StatusName

Age

StatusMr. Thomas ENDERS

60

Executive

Mr. Guillaume FAURY

51

Executive* Further information on the Board members can be found in the above table “Composition of the Board of Directors in 2018”.

CHANGES IN THE COMPOSITION OF THE BOARD COMMITTEES IN THE COURSE OF 2018
Until AGM 2018*

From AGM 2018

Committee

Name

StatusAudit

Ms. Claudia NEMAT**

Member

Sir John PARKER

ECC

Member

Sir John PARKER
RNGC

Name

StatusMr. Victor CHU

MemberMr. René OBERMANN

MemberLord Paul DRAYSON

Member

Ms. Amparo MORALEDA

Mr. Hans-Peter KEITEL

MemberMr. Jean-Pierre CLAMADIEU

MemberMr. Jean-Claude TRICHETMember

Ms. Claudia NEMAT

Member*	Further information on the Committee members can be found in the above tables “Composition of the Board of Directors in 2018” and “Replacements of Board
Members in the course of 2018”**	Ms. Nemat resigned from the Audit Committee in 2018 and was replaced by Mr. Victor Chu and Mr. René Obermann. The Audit Committee currently consists of
5 members instead of 4.
Chair

Independent Directors
The Independent Directors appointed pursuant to the criteria
of independence set out above are Denis Ranque, Ralph
Crosby, Catherine Guillouard, Victor Chu (from AGM 2018),
René Obermann (from AGM 2018), Hermann-Josef Lamberti,
Lord Paul Drayson, Maria Amparo Moraleda Martinez, Claudia
Nemat, Carlos Tavares and Jean-Pierre Clamadieu (from AGM
2018).

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Prior Offences and Family Ties
To the Company’s knowledge, none of the Directors (in either
their individual capacity or as Director or senior manager of
any of the entities listed above) has been convicted in relation
to fraudulent offences, been the subject of any bankruptcy,
receivership or liquidation, nor been the subject of any official
public incrimination and/or sanction by a statutory or regulatory
authority, nor been disqualified by a court from acting as a
Member of the administrative, management or supervisory
bodies of any issuer or conduct of affairs of any company,

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during at least the last five years. As of the date of this document,
there are no family ties among any of the Directors.

order to build a state of the art Ethics & Compliance programmeand organisation.

(iii) Operation of the Board of Directors in 2018

Following the departure of some members of the Executive
Committee in early 2018 and the announcement that thecurrent CEO and Chief Financial Officer (“CFO”) would leave
the Company at the next AGM, the Board dedicated a largepart of its work in 2018 to the search and nomination of a newgeneration of leaders to prepare the Company for the challengesof the next decade. The RNGC has run, for each of the positions
to be filled, a thorough process in which internal and external
candidates have been identified and assessed. The shortlisted
candidates were then proposed to the Board and interviewed by
Board Members. Already in the course of 2018, the vacancy for a
Chief Technical Officer (“CTO”) was filled by Grazia Vittadini, whobecame the first female member of the Executive Committee.
By the end of 2018, successors for key positions had been
selected and announced – in particular for the CEO, the CFO
and the Chief Operating Officer (“COO”).

Board of Directors Meetings
The Board of Directors met 10 times during 2018 and wasregularly informed of developments through business reports
from the CEO, including progress on the strategic andoperational activities. The average attendance rate at thesemeetings was 87%.

Throughout 2018, the Board of Directors reviewed anddiscussed the technical and commercial progress of significant
new and running programmes. For Airbus Commercial thiscomprised inter alia the ramp-up of the A320neo programme
and the respective measures taken to mitigate the engine
issues hampering the production at Airbus and the operations
with the customers, the development of the A330neo and theramp-up of the A350. For Defence and Space it concerned for
the A400M programme the progress on the military capabilities
and the retrofit and delivery plan in line with the agreement
reached with OCCAR and the states; on the space side theAriane 6 programme was the subject of a thorough review withregards to progress and the competitive landscape. Turning
to the Helicopter business, the review focused on the overallmarket situation and the preparation of the H160 programme forserial production. Regarding mergers and acquisitions, the mostimportant topic was the closure of the acquisition of a majority
stake in the Bombardier C Series programme which represents
an important addition to complement the Airbus product range
at the smaller end of the aircraft market.
Last year’s off-site Board meeting in September in Beijing
focused on the review of the Division and product strategies
and the related business developments as well as the overall
strategy of the Company. The Board of Directors seized theopportunity to visit the A320 final assembly line and the A330
completion and delivery centre in Tianjin.
In 2018, the Board of Directors continued to support theCompany’s digital transformation and to enhance the Company’s
ability to identify and capitalise on innovative technologies andbusiness models. After thorough preparation, 2018 saw theindustrialisation and acceleration of the digital concepts. Oneof the most advanced is the Skywise project, a global data
platform which can create significant value across the wholeaerospace industry. Other projects transforming the engineeringand manufacturing landscape are are in progress.
Moreover the Board of Directors reviewed Airbus’ financial
results and forecasts and, in line with the recommendationsof the Audit Committee, emphasised the importance of bothEnterprise Risk Management (“ERM”) and a strengthened
internal control system.
A substantial share of the Board activities was dedicated tocompliance matters. Following a recommendation by the
Ethics & Compliance Committee, the Board strengthened the
Ethics & Compliance organisation by allowing a reinforcementof its resources, so helping to improve the Company’ cultureof integrity. The Board also continued to closely monitor the
Serious Fraud Office / Parquet National Financier investigations.
In addition, the Board received advice from the “Independent
Compliance Review Panel”, which is composed of renowned
international experts, with respect to its compliance activities in

Board Evaluation 2018
As a matter of principle, the Board of Directors has decided thata formal evaluation of the functioning of the Board of Directors
and its Committees with the assistance of a third-party expert is
conducted every three years. In the year succeeding the outside
evaluation, the Board of Directors performs a self-evaluation andfocuses on the implementation of the improvement action plan
resulting from the third-party assessment. In the intervening
second year, the General Counsel, being also the Secretaryof the Board, issues a questionnaire and consults with Board
Members to establish an internal evaluation which is thendiscussed with Board Members.

4

The year 2018 was the intervening second year of theabovementioned three-year cycle. In October 2018, the Boardof Directors therefore performed a self-evaluation based on aquestionnaire issued by the General Counsel and circulated toeach Board Member.
The questionnaire primarily covered governance and Board
agenda, Board and Board Committees functioning, interactions
are dynamic amongst Board members and between Board andManagement, Board composition and renewal process, Board
and Board Committees fees, Board Committees contributions
and involvement of Remuneration, Nomination and GovernanceCommittee in succession planning. With respect to theRemuneration policy, the Board Members were provided theopportunity to express their views on their own remuneration.
In the 2018 self-evaluation, the Board Members confirmed
overall satisfaction with the progress made in the implementationof the Board’s “Improvement Action Plan” recommended byHeidrick & Struggles as its third-party expert, following theformal evaluation conducted in 2017.
The Board Members also confirmed overall satisfaction with the
dynamics of the Company’s governance and its performance. The
outcome of the questionnaire notably highlighted the improved
balance of powers and constructive interactions amongst
Board Members and between the Board and Management,
as well as open debates between the Board Members. The
efficient decision-making process of the Board is supportedby the adequate preparation of Board meetings, suitable time
allocated to agenda items and valuable contributions of theBoard Committees.

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Following the last Board review, one-to-one sessions between
Board Members took place to improve connections between
them. Top Management team members have been regularly
invited to participate to Board meetings to discuss specifictopics; and Board Members expect the frequency of thisparticipation to be improved in 2019.
In addition, the Board has dedicated more time to risk andperformance management, succession planning and talentdevelopment, as well as to other important matters for which

4.1.1.2

Finally, the Board Members expressed their overall satisfaction
with regards to the Board composition and renewal process.
They highlighted the necessity to continue with the principle ofstaggering Board appointments in order to further develop its
diversity of expertise and gender.

Board Committeesa) The Audit Committee
The Audit Committee has five (5) Members and is chaired by
an Independent Director who is not the Chair of the Boardof Directors or a current or former Executive Director of theCompany. The Chair of the Audit Committee shall be, andthe other members of the Audit Committee may be, financial
experts with relevant knowledge and experience of financial
administration and accounting for listed companies or otherlarge legal entities.
Pursuant to the Board Rules, the Audit Committee, whichis required to meet at least four times a year, makes
recommendations to the Board of Directors on the approvalof the annual financial statements and the interim accounts(Q1, H1, Q3), as well as the appointment of external auditors
and the determination of their remuneration. Moreover, theAudit Committee has responsibility for verifying and making
recommendations to the effect that the internal and external
audit activities are correctly directed, that internal controls are
duly exercised and that these matters are given due importanceat meetings of the Board of Directors. Thus, it discusses withthe auditors their audit programme and the results of the auditof the financial statements, and it monitors the adequacy ofAirbus’ internal controls, accounting policies and financial
reporting. It also oversees the operation of the Company’s ERM
system and keeps a strong link to the Ethics and Compliance
Committee. For further details in this regard, see “— 4.1.3
Enterprise Risk Management System”. Please refer to Annex Eof the Board Rules for a complete list of responsibilities of the
Audit Committee.
The Chairman of the Board of Directors and the CEO are invited
to attend meetings of the Audit Committee. The CFO and theHead Accounting Record to Report are requested to attend
meetings to present management proposals and to answer
questions. Furthermore, the Head of Corporate Audit & Forensic
and the Chief Ethics and Compliance Officer are requested toreport to the Audit Committee on a regular basis.
In 2018, it met five times with an average attendance rate of
88%, it discussed all of the items described above during themeetings and it fully performed all of the duties described.
b) The Ethics and Compliance Committee
To reinforce oversight of ethics and compliance matters at theBoard of Directors level, a dedicated Ethics and Compliance
Committee (“E&C Committee” or “ECC”) was established in2017 and the Board Rules have been amended accordingly.
Pursuant to the Board Rules the main mission of the E&C
Committee is to assist the Board in monitoring Airbus’
culture and commitment to ethical business and integrity.

132

discussions need to be still further enhanced, such as strategy,
digital transformation, Responsibility & Sustainability, employee
engagement and anticipation of significant potential issues.

Airbus / Registration Document 2018

This committee is empowered to oversee Airbus’ ethics andcompliance programme, organisation and framework in orderto make sure that Airbus ethics and compliance governance iseffective (including all associated internal policies, procedures
and controls). This includes the areas of money laundering andterrorist financing, fraud, bribery and corruption, trade sanctions
and export control, data privacy, procurement and supply chain
compliance and anti-competitive practices.
The E&C Committee has five (5) Members and is chaired byany of its members. Each member should be an Independent
Director. Both the chairman of the Audit Committee and thechair of the RNGC is a member of the E&C Committee.
The E&C Committee makes recommendations to the Boardof Directors and its Committees on all ethics and compliancerelated matters and is responsible for providing to the Audit
Committee any necessary disclosures on issues or alleged
ethical and compliance breaches that are financial andaccounting-related. The E&C Committee maintains a reporting
line with the Chief Ethics and Compliance Officer, who isrequested to provide periodic reports on its activities.
The Chairman of the Audit Committee and the Chair of the
RNGC are members of the E&C Committee. Unless otherwise
decided by the E&C Committee, the CEO is invited to attend
the meetings. From time to time, independent external experts
and the Independent Compliance Review Panel are also invited
to attend E&C Committee meetings.
The E&C Committee is required to meet at least four times ayear. In 2018, the E&C Committee met in total 11 times with anaverage attendance rate of 93%. All of the above described items
were discussed during the meetings and the E&C Committee
fully performed all the above-described duties.
c) The Remuneration, Nomination and GovernanceCommittee
The RNGC has four (4) Members, with geographic diversity.
Each Member of the RNGC is an Independent Director. One
Member of the RNGC is a Director who is appointed to theBoard of Directors on the basis of the French State Security
Agreement. One Member of the RNGC is a Director who isappointed to the Board of Directors on the basis of the German
State Security Agreement. The Board of Directors, by a Simple
Majority (defined below), appoints the chair of the RNGC, who
may not be any of the following:
Chairman of the Board of Directors;--theor former Executive Director of the Company;--aa current
Non-Executive Director who is an Executive Director with--another
listed company; or

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appointed to the Board of Directors on the basis--aofDirector
the French State Security Agreement or the German State

Security Agreement.
Pursuant to the Board Rules, besides its role described in
section 4.1.1 above, the RNGC consults with the CEO withrespect to proposals for the appointment of the members of
the Executive Committee, and makes recommendations to theBoard of Directors regarding the appointment of the Secretary to
the Board of Directors. The RNGC also makes recommendations
to the Board of Directors regarding succession planning (atBoard, Executive Committee and Senior Management levels),remuneration strategies and long-term remuneration plans.
Furthermore the Committee decides on the service contracts
and other contractual matters in relation to the Members of theBoard of Directors and the Executive Committee. The rules andresponsibilities of the RNGC have been set out in the Board
Rules.
The Chair of the Board of Directors and the CEO are invited toattend meetings of the RNGC. The Chief Human Resources
Officer (“CHRO”) is requested to attend meetings to present
management proposals and to answer questions.
In addition, the RNGC reviews the Company’s top talent,
discusses measures to improve engagement and to promote
diversity, reviews the remuneration of the Executive Committee
Members, the Long-Term Incentive Plans (“LTIP”), and thevariable pay for the previous year.
Finally, the RNGC performs regular evaluations of the Company’s
corporate governance and makes proposals for changes to theBoard Rules or the Articles of Association.
The guiding principle governing management appointments
within Airbus is that the best candidate should be appointed tothe position (“best person for the job”), while at the same timeseeking to achieve a balanced composition with respect togender, experience, national origin, etc. The implementation ofthese principles should, however, not create any restrictions on
the diversity within the Company’s executive management team.
The RNGC is required to meet at least four times a year. In 2018,
it met nine times with an attendance rate of 89%, it discussed
all of the above described items during the meetings and it fully
performed all of the above described duties.

4.1.1.3

The Executive Committeea) Nomination and Composition
The Executive Committee of Airbus (the “Executive Committee”)
is chaired by the Chief Executive Officer and its members areappointed on the basis of their performance of their individual
responsibilities as well as their respective contribution to theoverall interest of Airbus.
The CEO proposes all of the Members of the Executive Committee
for approval by the Board of Directors, after consultation with(i) the Chairman of the RNGC and (ii) the Chairman of the Boardof Directors, applying the following principles:the preference for the best candidate for the position;
the maintenance, in respect of the number of Members of
the Executive Committee, of the observed balance among
the nationalities of the candidates in respect of the location of---

the main industrial centres of Airbus (in particular among thenationals of France, Germany, Spain and the United Kingdom,
where these main industrial centres are located); andat least 2/3 of the Members of the Executive Committee,
including the CEO and the CFO, being EU nationals andresidents.

--

The Board of Directors determines, by simple majority vote,whether to approve all of the Members of the Executive
Committee as proposed by the CEO.
b) Role of the Executive Committee
The CEO is responsible for executing the strategy, as approvedby the Board of Directors, and for managing the day-to-day
operations of Airbus’ business and he shall be accountable forits proper execution. For this purpose, the CEO regularly seeks
advice from his core executive management team (“EMT”),
which comprises some of the Executive Committee Members,on Airbus-wide topics such as corporate matters or major
ongoing projects as well as on business development andperformance improvement opportunities.
The Executive Committee further supports the CEO in performing
these tasks, ensuring proper alignment of the Company’s
management beyond the EMT. The Executive Committee
Members shall jointly contribute to the overall interests of theCompany, in addition to each Member’s individual operationalor functional responsibility within Airbus. The CEO endeavours
to reach consensus among the Members of the Executive
Committee. In the event a consensus is not reached, the CEO
is entitled to decide the matter.

4c) The Executive Committee in 2018
The Executive Committee comprises the heads of the Divisions
and key functions of the Company, and is dedicated to exchange
and align on important matters such as:
by the heads of the Airbus Divisions and functions--appointmentof their management teams;
investments/divestments;--majorup and control of the implementation of the strategy--settingfor Airbus’ businesses;
policy matters and management and organisational--Airbus
structure of the business;of the Company’s financial performance and--definitionbusiness performance strategy and targets;issues, including the operational plan of the Company--businessand its Divisions.

It is also the forum where the information or requests for approvaldestined for the Board are discussed and approved. The CEO
is the only Executive Director within the Board of Directors andrepresents the Company on the Board. But, depending on therespective topic, he usually asks the responsible Executive
Committee Member to join him in the Board for presenting thefinancials (CFO), programme/product topics (Division head),HR matters (CHRO) or any other topic where a specialist isneeded. This approach allows Board Members to get to know
the Executive Committee Members and equips them to makejudgements when it comes to decisions about key positions.
The Executive Committee met four times during 2018.

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Corporate Governance /4.1 Management and Control

COMPOSITION OF THE EXECUTIVE COMMITTEE AS OF 11 APRIL 2019
Name

Start of term

Principal Occupation

Guillaume Faury

2018

Chief Executive Officer Airbus

Dominik Asam

2019

Chief Financial Officer

Thierry Baril2012

Chief Human Resources Officer

Jean-Brice Dumont

2019

Executive Vice President Engineering

Bruno Even

2018

Chief Executive Officer Airbus Helicopters

John Harrison

2015

General Counsel

Dirk Hoke2016

Chief Executive Officer Airbus Defence and Space

Julie Kitcher

2019

Executive Vice President Communications and Corporate Affairs

Philippe Mhun

2019

Executive Vice President Programmes and Services

Christian Scherer

2019

Chief Commercial Officer

Michael Schöllhorn

2019

Chief Operating Officer

Grazia Vittadini

2018

Chief Technology Officer

Note: Status as per 11 April 2019. The professional address of all Members of the Executive Committee for any matter relating to Airbus is Mendelweg 30, 2333 CS Leiden,
the Netherlands.

Guillaume Faury – Chief Executive Officer Airbus(see above under “— 4.1.1.1 Board of Directors”)
Dominik Asam – Chief Financial Officer
Dominik Asam is Chief Financial Officer (CFO) of Airbus and amember of the Executive Committee.
Dominik Asam joined Airbus in April 2019 from Munich-based
Infineon Technologies AG, where he had been CFO since 2011.
During eight years he was responsible for functions includingGroup Controlling, IT, Treasury, Investor Relations, Compliance& Risk Management, Export Control and Sustainability andBusiness Continuity.
Previously, Dominik Asam was Head of Group Controlling at
RWE AG in 2010.
Between 2005 and 2010 he held various positions at Siemens
AG such as CEO of Siemens Financial Services and Corporate
Vice President and Treasurer.
From 2003 to 2005, Asam headed Investor Relations, Mergers &Acquisitions and Strategy at Infineon Technologies.
Dominik Asam began his professional career in 1996 in theInvestment Banking Division of Goldman Sachs Inc. withpostings in Frankfurt, London and New York.
A graduate in Mechanical Engineering from the Technical
University of Munich and the École Centrale Paris, Dominik
Asam holds a Master’s in Business Administration from INSEAD(European Institute of Business Administration).
Thierry Baril – Chief Human Resources Officer
Thierry Baril was appointed Chief Human Resources Officer of
Airbus on 1 June 2012. In addition, Baril continues to serve as
Airbus Commercial Aircraft Chief Human Resources Officer.
Thierry Baril joined Airbus Commercial Aircraft in 2007 as
Executive Vice President, Human Resources, and Memberof the Airbus Commercial Aircraft Executive Committee, withresponsibility for defining and implementing a company-wide
Human Resources strategy, enhancing integration and employee

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engagement. He oversaw the development of key skills andcompetences to support business growth and greater internal
mobility. One of his main achievements was the transformationof the Company in the areas of leadership culture and diversity,
having played a key role in the implementation of “Power8” andAirbus’ internationalisation strategy.
Prior to this, Thierry Baril was Executive Vice President Human
Resources at Eurocopter – now Airbus Helicopters – and memberof the Eurocopter Executive Committee from January 2003. In
this position, Baril managed the Company’s Human Resources
activities globally, including the implementation of Human
Resources policies across Eurocopter’s European sites andits 15 subsidiaries worldwide. He was instrumental in theimplementation of “Vital”, a programme which transformed
Eurocopter as a business.
Thierry Baril started his career in 1988 as Deputy Human
Resources Director at Boccard SA, and transferred to Laborde& Kupfer-Repelec, a subsidiary of GEC ALSTHOM, as Human
Resources Manager in 1991.
From 1995, Thierry Baril held roles as Human Resources
Director of the Alstom Energy Belfort site and Vice Presidentof Human Resources of the Alstom Energy Group.
Following on from his experience at Alstom Energy, in 1998
Thierry Baril became Managing Director of Human Resources
for Europe for GE (General Electric) at their Belfort Headquarters,
followed by Vice President of Human Resources at Alcatel
Space’s Headquarters in Toulouse from 2000.
Jean-Brice Dumont – Executive Vice President Engineering
Jean-Brice Dumont was appointed Executive Vice President
Engineering at Airbus in April 2019 and is a member of theCompany’s Executive Committee.
With over two decades of industry experience, he joined
Airbus Commercial Aircraft in this role in January 2018 after
six successful years as Executive Vice President, Engineeringand Chief Technical Officer at Airbus Helicopters. Beyond his
Engineering leadership, Jean-Brice strongly promotes diversity,
teamwork and core human values such as humility and respect.

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Jean-Brice Dumont joined Eurocopter, the predecessor
company to Airbus Helicopters, in February 2004. There, heworked as an Engineer and Development Project Manager
for the NH90 programme, prior to becoming the NH90 Chief
Engineer and NH Industries’ Technical Director from 2008 to
2012.
A licensed French Army Aviation pilot, Dumont started his
career with the country’s DGA military procurement agency in
1996, where he worked on the Tiger and Super Puma rotorcraft
programs before ultimately being appointed the organisation’s
Chief Test Director for the Tiger helicopter in 2002.
Jean-Brice Dumont is a graduate of France’s École Polytechniqueand of the ISAE Aerospace Institute. He was born in 1971, ismarried with two sons and enjoys running marathons andswimming.
Bruno Even – Chief Executive Officer – Airbus Helicopters
Bruno Even was appointed Chief Executive Officer (CEO) of
Airbus Helicopters as of 1 April 2018. He is a member of the
Airbus Executive Committee.
He joined the Company from Safran, where he held various
management positions at the Helicopter Engines and Electronic& Defence businesses. Since 2015, he served as Chief Executive
Officer of Safran Helicopter Engines (ex-Turbomeca). Prior tothat position, he was CEO of Safran Electronics & Defence(exSagem).
Bruno Even graduated from the École Polytechnique and began
his professional career in 1992 at the French Ministry of Defence,
where he was in charge of developing the space component
for the Helios II satellite.
In 1997, he transferred to the Ministry of Foreign Affairs to
become technical advisor for the Director of Strategic Affairs,
Security and Disarmament. He moved to the private sector andjoined Safran in 1999.
John Harrison – General Counsel
John Harrison has been General Counsel since June 2015.
Solicitor of the Supreme Court of England & Wales, John
Harrison completed his academic studies at the University of
McGill, Montréal, Canada. He holds a Bachelor LLB (Hons) and
Masters LLM of Laws degree.
John Harrison began his career in 1991 at the international law
firm Clifford Chance, working consecutively in their London,
New York and Paris offices.
He joined Airbus then Technip S.A. where he served as Group
General Counsel and Member of the Executive Committee from2007-2015.
Prior to joining Technip, Mr Harrison fulfilled various senior legal
positions in Airbus companies over a 10 year period culminating
his tenure from 2003-2007 as General Counsel of the EADSDefence Division.
John Harrison was born on 12 July 1967 in the United Kingdom.
Dirk Hoke – Chief Executive Officer – Airbus Defence
and Space
Dirk Hoke is the designated Chief Executive Officer (CEO) of
Airbus Defence and Space as of 1 April 2016. He started on
1 January 2016 as Deputy CEO. He is a member of the Executive
Committee.

Dirk Hoke joined Airbus from Siemens, where he had been
CEO of the Large Drives Business Unit since 2014. He has held
various executive-level positions at Siemens since becoming
CEO of the Cluster Western & Central Africa in 2008. His careerspans 21 years and five continents.
In 1994, Dirk Hoke began his professional career as R&D Engineer
for process and software analysis in the automotive industry
at Renault in Paris. In 1996, he joined Siemens through aninternational trainee programme with assignments in Germany,
Argentina and Austria. He then held various management postsin the Transportation Systems Division based in Germany. He
relocated to Sacramento, USA, as Head of the Transportation
Systems restructuring team in 2001.
Dirk Hoke continued his professional career at Siemens as
General Manager for the Transrapid Propulsion and Power
Supply Subdivision from 2002 to 2005 including the Shanghai“Maglev” project. He was then promoted to President ofSiemens Transportation Systems China and made Siemens
the largest foreign railway supplier in the country.
In 2008, Dirk Hoke moved to Morocco to lead Siemens’ Africa
activities. He returned to Germany in 2011 to become theDivision CEO of Industrial Solutions with the special task to build
up the services business for the Industry Sector. Afterwards, he
was called upon to restructure the Large Drives Business Unit.

4

Dirk Hoke holds a degree in mechanical engineering from theTechnical University of Brunswick, Germany. In 2010, Dirk Hokebecame a member of the Young Global Leader Class of theWorld Economic Forum and in 2013, member of the Baden
Baden Entrepreneur Talks.
Born on 2 April 1969, Dirk Hoke is married with two children.
Julie Kitcher – Executive Vice President Communications
and Corporate Affairs
Julie Kitcher is EVP Communications and Corporate Affairs of
Airbus and a member of the Executive Committee.
Julie leads all external and internal communication activities.
The role also oversees and co-ordinates the transformation
agenda of Airbus. This includes Corporate Audit, Performance
Management, Responsibilit y and Sustainabilit y andEnvironmental Affairs. She is also Chief of Staff to the CEO.
Previously, from May 2015 to April 2019, she was Head of Investor
Relations and Financial Communication for Airbus. In this role,
Julie was responsible for the development, management,
consistency and communication of the Airbus Equity Story,
Vision and Strategy to the financial markets. One of her core
missions was to grow and strengthen the relationship and trustwith the financial markets, contributing to the strong share priceperformance during these years.
Under Julie’s leadership, Airbus was awarded “Most Honoured
Company” status in the Institutional Investor All Europe Executive
Team survey four years in a row, from 2015 to 2018. As partof this recognition, Julie was named “Best Investor Relations
Professional” in the Aerospace & Defence sector for the same
period.
From 2008 to 2015, Julie led relations with UK, French andSouthern European institutional investors and sell-side
analysts in Airbus’ Investor Relations team. Alongside this, shecoordinated Airbus’ quarterly Financial Disclosures.

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Corporate Governance /4.1 Management and Control

Julie began her Airbus career in December 2000 working at
Filton, UK. She went on to hold a number of roles in financeincluding Financial Analyst, Corporate Planning and BusinessControlling. She also previously held a role in GE Capital
Equipment Finance in the UK.
She is a Chartered Management Accountant (CIMA) with an
MSc in Accounting, ESC Skema (Lille).
Julie was born in the United Kingdom. She is married with twochildren.
Philippe Mhun – Executive Vice President Programmes andServices
Philippe Mhun was appointed as Chief Programmes & Services
Officer for Airbus Commercial Aircraft, effective 1 January 2019,
and a member of the Company’s Executive Committee.
In his previous role as Head of Customer Services since
October 2016, Philippe Mhun was responsible for all Airbus
support and services activities for airline customers, lessors,
MROs and operators, ranging from maintenance andengineering to training, upgrades and flight operations but
also material management and logistical support. This included
the supervision of the Services Business Unit and affiliatedsubsidiaries, such as Satair, Navblue, Airbus Interiors Services
and Sepang. For the past two years, Philippe has initiated andimplemented a major transformation programme focusing
on Customer Satisfaction, Services development and digital
enablers such as Skywise applications.
Prior to this assignment, Philippe was Senior Vice President
Procurement for Equipment, Systems and support, a position
he held since 2013.
Philippe joined Airbus in November 2004 as Vice President A380
Programme within Customer Services to prepare and support
the A380 entry-into-service. He then became Vice President
Programmes in Airbus Customer Services leading Single Aisle,Long Range, Widebody, A380 and A350 Programmes together
with e-operations and supplier support activities.
Before joining Airbus, Philippe held various positions within UTA
and, following the merger in 1993, within Air France, starting
as a Structure Engineer for Boeing 747 at UTA all the way up
to becoming the Head of Long-Haul Fleet Engineering and
Maintenance in Air France. From 1986 to 2004, Philippe wasinvolved in new programmes’ entry-into-service, engineeringand maintenance at all levels of the company.
Christian Scherer – Chief Commercial Officer
Christian Scherer was appointed Airbus Chief Commercial
Officer in September 2018 and is a Member of the Company’s
Executive Committee.
He was previously Chief Executive Officer of ATR, a position heheld since November 2016.
Prior to this, Christian was Executive Vice-President and Headof Airbus Group International, responsible for driving the overall
Airbus Group internationalisation strategy.
Christian started his professional career in 1984 when he joined
Airbus Industrie as a Commercial Contracts Manager. He wasseconded to the US between 1987 and 1994 as Vice President
Contracts of Airbus North America, responsible for pricing,

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financial performance, negotiation and implementation of all
sales transactions in North America.
On his return to headquarters, as Vice President Leasing
Markets, he developed and managed an integrated sales
division covering all commercial activities dealing with operating
leasing companies and other financial institutions worldwide.
In 1999, he was appointed Vice President Contracts and Pricing
worldwide while retaining leadership of the Leasing Markets
Division and in 2003 he also became the Deputy Head ofCommercial.
Following his time in Commercial, he became Head of Strategy
and Future Programs at Airbus, responsible for defining Airbus’
long term strategic objectives and for driving the genesis of
future aircraft product offerings and programmes, such as the
A320neo, as well as Airbus’ international development in termsof the US final assembly lines.
In 2012, he was appointed Head of Sales & International
Operations at Cassidian in Munich, Germany, responsible
for Sales, Marketing, Strategy and Cassidian’s International
Subsidiaries including Brazil, India, KSA, UAE, UK and USA.
Upon integration of Airbus’ Defence, Space and Military aircraftbusinesses, he became the Head of Marketing & Sales ofAirbus Defence and Space and Managing Director of Airbus
Defence and Space GmbH. In that role, he held the overall
responsibility for all Sales & Marketing activities. He also chaired
BDLI’s defence and security forum whilst being a member ofthe BDLI presidium.
Born in 1962 in Duisburg, Germany, and raised in Toulouse,
France, Christian Scherer holds an MBA from the University ofOttawa and graduated from the Paris Business School (ESCP)in 1984.
Michael Schöllhorn – Chief Operating Officer
Michael Schöllhorn is Chief Operating Officer (COO) for Airbus
and a member of the Airbus Executive Committee.
He joined Airbus in February 2019 from BSH Home AppliancesGmbH in Munich, where he was COO and a member of the
BSH Management Board from 2015.
Between 2012 and 2014, Michael Schöllhorn was Executive Vice
President Manufacturing and Quality, additionally heading the
Global Business unit for chassis and safety sensors.
Prior to this, Michael Schöllhorn held several international
management positions within the Bosch Group. He was basedin the US, Czech Republic and Germany. During this time, hegained a broad expertise in digitalisation, end-to-end processoptimisation, manufacturing, engineering, quality and supply
chain management.
Michael Schöllhorn holds a degree in Mechanical Engineeringand a PhD in Control Engineering from the Helmut Schmidt
University in Hamburg. He served in the German Armed Forces
as a helicopter pilot and officer from 1984 to 1994.
Grazia Vittadini – Chief Technology Officer
Grazia Vittadini has been appointed Chief Technology Officer(CTO) of Airbus and a member of the Airbus Executive
Committee, effective 1 May 2018.

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Furthermore, she serves as Director of the Airbus Foundation
Board and as a member of the Inclusion and Diversity Steering
Committee.
Previously, Vittadini was Executive Vice President Head ofEngineering since January 2017 and member of Executive
Committee of Airbus Defence and Space.
Prior to this position, she had been Senior Vice President Headof Corporate Audit & Forensic, responsible for Airbus Groupaudit activities worldwide.
Since January 2013 and for one year and a half, Grazia wasVice President Head of Airframe Design and Technical Authority
for all Airbus aircraft.

Always leading transnational teams in multiple locations, she also
served as Chief Engineer on the Wing High Lift Devices of the
A380 in Bremen from First Flight to In-Service (2005-2009) andthen contributed to securing First Flight and Type Certificationof the A350 XWB aircraft as Head of Major Structural Tests in
Hamburg. The Major Tests for A320 Extended Service Goal,
A380 and A400M were also in her scope.
Vittadini began her professional career on the Italian side of
the Eurofighter Consortium, before joining Airbus Operationsin Germany in 2002 and setting on her path towards senior
management positions.
Grazia Vittadini graduated in Aeronautical Engineering and she
specialized in Aerodynamics from the Politecnico di Milano.

4.1.2 Dutch Corporate Governance Code, “Comply or Explain”
In accordance with Dutch law and with the provisions of the
Dutch Code as amended in 2016, which includes a number of
non-mandatory recommendations, the Company either applies
the provisions of the Dutch Code or, if applicable, explainsand gives sound reasons for their non-application. While theCompany, in its continuous efforts to adhere to the highest
standards, applies most of the current recommendations of
the Dutch Code, it must, in accordance with the “comply or
explain” principle, provide the explanations below.
On 8 December 2016, the Dutch Code was revised; its updated
recommendations apply to financial years starting on or after
1 January 2017.
Airbus welcomed the updates to the Dutch Code and continues
supporting the emphasis of the revised Dutch Code on topics
such as long-term value creation and the importance of culture.
For the full text of the Dutch Code as well as the New Code,please refer to www.commissiecorporategovernance.nl.
For the financial year 2018 and in respect of compliance with
the Dutch Code, the Company states the following:
1. Vice-Chairmanship
Provision 2.3.6 (ii) of the Dutch Code recommends the election ofa vice-chairman, to, among other things, deal with the situation
when vacancies occur.
The Board of Directors is headed by the Chairman of the Boardof Directors and no vice chairman is appointed. In case of
dismissal or resignation of the Chairman, the Board of Directors
shall immediately designate a new Chairman. In Airbus’ view
there is no need for the appointment of a vice-chairman to deal
with such situations or other circumstances.
2. Termination Indemnity
Provision 3.2.3 of the Dutch Code recommends that the
maximum remuneration in the event of dismissal of an Executive
Board Member be one year’s salary. Under this provision of the
Dutch Code, severance pay should not be awarded if the Board
membership is terminated early at the initiative of the Executive

Board Member, or in the event of seriously culpable or negligent
behaviour on the part of the Executive Board Member.

4

The Company foresees a termination indemnity for the sole
Executive Board Member, the CEO, equal to one and a halftimes the annual total target salary in the event that the Boardof Directors has concluded that the CEO can no longer fulfil
his position as a result of change of the Company’s strategy or
policies or as a result of a change in control of the Company.
The termination indemnity would be paid only provided that theperformance conditions assessed by the Board of Directors had
been fulfilled by the CEO.
3. Securities in the Company as Long-Term Investment
Provision 3.3.3 of the Dutch Code recommends that nonExecutive Directors who hold securities in the Company should
keep them as a long-term investment.
The Company does not encourage non-Executive Directors
to own shares, but also does not require its non-Executive
Directors who hold shares in its share capital, to keep suchshares as a long-term investment. Although non-Executive
Directors are welcome to own shares of the Company, theCompany considers it is altogether unclear whether shareownership by non-Executive Directors constitutes a factor of
virtuous alignment with stakeholder interest or may be a sourceof bias against objective decisions.
4. Dealings with Analysts
Provision 4.2.3 of the Dutch Code recommends meetings withanalysts, presentations to analysts, presentations to investors
and institutional investors and press conferences shall beannounced in advance on the Company’s website and by meansof press releases. In addition, it recommends that provisions
shall be made for all shareholders to follow these meetingsand presentations in real time and that after the meetings thepresentations shall be posted on the Company’s website.
The Company does not always allow shareholders to follow
meetings with analysts in real time. However, the Company
ensures that all shareholders and other parties in the financial
markets are provided with equal and simultaneous information
about matters that may influence the share price.

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5. Gender Diversity
The Company strives to comply with the composition guidelines
regarding gender diversity under Dutch law pursuant to which
the Board of Directors would be regarded as being composedin a balanced way if it contained at least 30% women and at
least 30% men. The proportion of the female representation on
the Board of Directors is currently at 25% (against 0% six yearsago). The Company will continue to promote gender diversity
within its Board of Directors in accordance with the principles
mentioned in section 4.1.1.1 above. In addition, the Company
will continue to give due consideration to any applicable gendertargets in its search to find suitable candidates and to actively
seek female candidates. However, the Company believes thatcandidates should not be recruited based on gender alone; thecapabilities and skills of potential candidates are most importantin this respect.

Furthermore, the Company is committed to supporting, valuing
and leveraging the value of diversity. That being said, theimportance of diversity, in and of itself, should not set aside
the overriding principle that someone should be recommended,nominated and appointed for being “the right person for the job”.
Although the Company has not set specific targets with respect
to particular elements of diversity, except for the principles
described in 4.1.1.1 above and those targets which apply bylaw, the Company is committed to seeking broad diversity inthe composition of the Board of Directors and its Executive
Committee and will consider attributes such as personal
background, age, gender, experience, capabilities and skills
when evaluating new candidates in the best interests of theCompany and its stakeholders.
The Company believes that the composition of its Board of
Directors and its Executive Committee is consistent with thesediversity objectives.

4.1.3 Enterprise Risk Management System
Airbus’ long-term development and production lifecycle makeERM a crucial mechanism for both mitigating the risks faced by
the Company and identifying future opportunities.
Applied across the Company and its main subsidiaries, ERM
is a permanent top-down and bottom-up process, which is
executed across Divisions at each level of the organisation. It
is designed to identify and manage risks and opportunities. A
strong focus is put on the operational dimension due to theimportance of Programmes and Operations for Airbus.
ERM is an operational process embedded into the day-today management activities of Programmes, Operations andFunctions. The key risks and their mitigations are reported to theBoard of Directors through a reporting synthesis, consolidated
on a quarterly basis.

process, which includes procedures to maintain--aandsupport
increase the quality of the ERM system.
The ERM process applies to all relevant sources of risks andopportunities that potentially affect the Company’s activities,
its businesses and its organisation in the short-, mid- and longterm. The ERM process is part of the management process andinter-related with the other processes.
All the Company’s organisations, including Divisions, subsidiaries
and controlled participations, commit to and confirm theeffective implementation of the ERM system. The annual ERM
Confirmation Letter issued by each organisation is the formal
acknowledgement about the effectiveness of the ERM system.
For a discussion of the main risks to which the Company is
exposed, see “— Risk Factors”.

The ERM system is articulated along four axes:

early risk reduction and attention to emerging--Anticipation:
4.1.3.2 ERM Governance and Responsibility
risks;The governance structure and related responsibilities for theand early warnings;--Speak-up
ERM system are as follows:
Robustrisk
mitigations;and--Opportunities.
Board of Directors supervises with support of the Audit--the-Committee the strategy and business risk and opportunities

4.1.3.1

ERM Process

The objectives and principles for the ERM system as endorsedby the Board of Directors are set forth in the Company’s ERM
Policy and communicated throughout the Company. The
Company’s ERM Policy is supplemented by directives, manuals,
guidelines, handbooks, etc. External standards which contributeto the Company’s ERM system include the standards as definedby the International Organisation for Standardisation (“ISO”).
The ERM process consists of four elements:

strong operational process, derived from ISO 31000 – to--aenhance
operational risk and opportunity management;
reporting process, which contains procedures for the status--areportingof the ERM system and the risk/opportunity situation;
ERM compliance process, which comprises procedures to--aassessthe effectiveness of the ERM system; and138

Airbus / Registration Document 2018as well as design and effectiveness of the ERM system;

CEO, with the top management, is responsible for an--theeffective ERM system. He is supported by the CFO, who

supervises the Head of ERM, and the ERM system design
and process implementation;
the Head of ERM has primary responsibility for the ERM
strategy, priorities, system design, culture development andreporting tool. He supervises the operation of the ERM system
and is backed by a dedicated risk management organisationin the Company focusing on the operational dimension,
early warning and anticipation culture development while
actively seeking to reduce overall risk criticality. The risk
management organisation is structured as a cross-divisional
Centre of Competence (“CoC”) and pushes for a proactive
risk management;--

REGISTRATION DOCUMENT 2018
Corporate Governance /4.1 Management and Control

management at executive levels has the responsibility--thefor the operation and monitoring of the ERM system in its

respective areas of responsibility and for the implementationof appropriate response activities to reduce risk and seize
opportunities, considering the recommendations of theinternal and external auditors.

4.1.3.3

ERM Effectiveness

The ERM effectiveness is analysed by ERM centre ofcompetence (“CoC”), based on ERM reports, confirmation
letters, in situ sessions (e.g., risk reviews), participation to key
controls (e.g., major Programme Maturity Gate Reviews) andCorporate Audit, based on internal corporate audit reports.

The combination of the following controls is designed to achieve reasonable assurance about ERM effectiveness:
Organisation

Explanations

Board of Directors /Audit Committee

Regular monitoring
The Board of Directors and the Audit Committee review, monitor and supervise the ERM system. Any material
failings in, material changes to, and/or material improvements of the ERM system which are observed, madeand/or planned are discussed with the Board and the Audit Committee.

Top Management

ERM as part of the regular divisional business reviews
Results of the operational risk and opportunity management process, self-assessments and confirmation
procedures are presented by the Divisions or other Airbus’ organisations to top management.

Management

ERM confirmation letter procedure
Entities and department heads that participate in the annual ERM compliance procedures must sign ERM
Confirmation Letters.

ERM CoC

ERM effectiveness measurement
Assess ERM effectiveness by consideration of ERM reports, ERM confirmations, in situ sessions(risk reviews etc.), participation to key controls (e.g., major Programme Maturity Gate Reviews).

Corporate Audit

Continuous monitoring and audits on ERM
Provide independent assurance to the Audit Committee on the effectiveness of the ERM system.

E&C

Alert System
Detect deficiencies regarding conformity to applicable laws and regulations as well as to ethical business principles.

4.1.3.4

Board Declaration

Based on the Company’s current state of affairs, the reports
made directly available to the Board of Directors, coming fromdifferent processes, audits and controls and the information it
received from management, the Board of Directors believes tothe best of its knowledge that:the internal risk management and control system provides
reasonable assurance that the financial reporting does notcontain any material inaccuracies;
this report provides sufficient insight into any material failings in
the effectiveness of the internal risk management and control
systems.

---

4

that the financial statements have been prepared--itonisajustified
going concern basis; andreport states the material risks and uncertainties that are--thisrelevant to the expectation of the Company’s continuity forthe period of 12 months after the preparation of the report.

It should be noted that no matter how well designed, the internalrisk management and control system has inherent limitations,such as vulnerability to circumvention or overrides of thecontrols in place. Consequently, no assurance can be giventhat the Company’s internal risk management and system andprocedures are or will be, despite all care and effort, entirely
effective.

4.1.4 Internal Audit
In accordance with Principle 1.3 of the Dutch Code, Airbus
Corporate Audit and Forensic assesses and provides objective
assurance on the design and effectiveness of the Company’srisk management, internal controls and governance systems. Its
mandate is set out in the Airbus Corporate Audit and Forensic
Charter.
Corporate Audit & Forensic engages in the independent andobjective corporate assurance activities of internal auditing andforensic investigations. It supports the Company in improving
its operations and accomplishing its objectives by bringing asystematic and disciplined approach to evaluate and improvethe effectiveness of the organisation’s governance, risk

management and internal controls. The function includes ateam of forensic specialists who assist Airbus and the Legal andCompliance function by leading and supporting investigationsof compliance allegations.
The department’s independence is established by direct
reporting to the Audit Committee and CEO. Corporate Audit &Forensic adheres to the Institute of Internal Auditor’s Definition ofInternal Auditing, Code of Ethics and International Standards for
the Professional Practice of Internal Auditing as well as relevant
policies and procedures of the Company. The department
was recertified by the Institut français de l’audit et du contrôleinternes (IFACI) in 2018.

Airbus / Registration Document 2018139

Corporate Governance /4.2 Interests of Directors and Principal Executive Officers

4.2 Interests of Directors and Principal
Executive Officers
4.2.1 Remuneration Policy
The Remuneration Policy covers all Members of the Board of
Directors: the CEO (who is the only Executive Director) andthe other Members of the Board (who are the Non-Executive
Directors).
It should be noted that although the policy relating to Executives
remuneration only refers to the CEO, these principles are also
applied to the other Members of the Executive Committee, who
do not serve on the Board of Directors, and to a large extent to
all Executives across Airbus. Upon proposal by the CEO, the
RNGC analyses and recommends, and the Board of Directors
decides, the remuneration of the Members of the Executive
Committee.
An amendment to the Remuneration Policy (as adopted at theAGM held on 28 April 2016) will be proposed for adoption by theshareholders at the AGM to be held in 2019. The application of
the Remuneration Policy in 2018 will be included as a separate
agenda item for discussion at the AGM to be held in 2019.
To see how the Remuneration Policy was applied in 2018 inrespect of the CEO (the only Executive Member of the Boardof Directors, see “— 4.2.1.5 Implementation of the remuneration
policy: CEO”. The cumulated remuneration of all Executive
Committee Members is presented in the “Notes to the IFRS
Consolidated Financial Statements — Note 31: Remuneration”.
To see how the Remuneration Policy was applied in 2018 inrespect of the non-Executive Members of the Board of Directors,
see “— 4.2.1.6 Implementation of the remuneration policy: NonExecutive Directors”.

4.2.1.1

Executive Remuneration – Applicableto the CEO

Except with respect to the amendments proposed in
Section 4.2.1.4 “Proposed amendments to the remuneration
policy”, related to contracts and severance provisions, there will
be no change in the remuneration policy in connection with theproposed appointment of a future CEO at the 2019 AGM; thepolicy as presented below will continue to apply.
a) Remuneration Philosophy
The Company’s remuneration philosophy aims to provide
remuneration that will attract, retain and motivate high-calibre
executives, whose contribution will ensure that the Company

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Airbus / Registration Document 2018

achieves its strategic and operational objectives, thereby
delivering long-term sustainable returns for all shareholders
and other stakeholders.
The Board of Directors and the RNGC are committed to making
sure that the executive remuneration structure is transparent
and comprehensive for all stakeholders, and to ensure that
Executive rewards are consistent and aligned with the interestsof long-term shareholders also taking into consideration salaryevolution of employees across the group.
Before setting the targets to be proposed for adoption by the
Board of Directors, the RNGC considers the financial outcome
scenarios of meeting performance targets, including achieving
maximum performance thresholds, and how these may affectthe level and structure of the Executive remuneration.
b) Total Direct Compensation and Peer GroupThe CEO’s total direct compensation (“Total Direct
Compensation”) comprises a Base Salary (“Base Salary”), an
annual variable remuneration (“Annual Variable Remuneration”
or “VR”) and a Long-Term Incentive Plan (“LTIP”). The threeelements of the Total Direct Compensation are each intended
to comprise one-third of the total, assuming the achievementof performance conditions is 100% of target.
The level of Total Direct Compensation for the CEO (Base Salary,VR and LTIP) is set at the median of an extensive peer groupand takes into account the scope of the role of the CEO andthe level and structure of executive rewards within Airbus. The
benchmark is regularly reviewed by the RNGC and is based ona peer group which comprises:
global companies in Airbus’ main markets (France, Germany,
UK and US); andcompanies operating in the same industries asAirbus worldwide.

---

The latest benchmark performed in November 2018 was basedon the relevant peer group composed of 76 companies selectedfrom CAC 40 in France, DAX 30 in Germany, FTSE 100 in the UK
and DJ 30 in the US as well as large European companies having
comparable economic indicators such as revenues, number of
employees and market capitalisation. Financial institutions were
excluded from the peer group.

REGISTRATION DOCUMENT 2018
Corporate Governance /4.2 Interests of Directors and Principal Executive Officers

The elements of the Total Direct Compensation are described below:
Remuneration Element

Main Drivers

Performance Measures

Target and Maximum

Base Salary

Reflects market valueof position.

Not applicable.

1/3 of Total Direct Compensation(when performance achievement
is 100% of target).

VR

Rewards annual
performance basedon achievement ofCompany performancemeasures and individual
objectives.

LTIP

Rewards long-term
commitment andCompany performance,and engagement
on financial targets
subject to cumulative
performance over athree-year period.

Collective (50% of VR): divided
between EBIT(1) (45%); Free CashFlow(2) (45%) and RoCE (10%).
Individual (50% of VR): Achievementof annual individual objectives,
divided between Outcomes
and Behaviour.

The VR is targeted at 100%of the Base Salary for the CEO and,depending on the performance assessment,
ranges from 0% to 200% of target.
The VR is capped at 200% of the Base Salary.

The original allocation to the CEO is capped
at 100% of the Base Salary at the time of grant.

Vesting ranges from 0% to 150%
of initial grant, subject toperformance over a three-year
period. In principle, no vesting
if cumulative negative EBIT.
If cumulative EBIT is positive,
vesting from 50% to 150%
of grant based on EPS (75%)
and Free Cash Flow (25%).

---

Since 2012, the following caps apply to
Performance Units only:
overall pay-out is capped at a maximum of
250% of the original value at the dateof grant.
The value that could result from shareprice increases is capped at 200% of thereference share price at the date of grant.

4(1) The Company continues to use the term EBIT (earnings before interest and taxes). It is identical to Profit before finance cost and income taxes as defined by IFRS Rules.
(2) Airbus defines the alternative performance measure free cash flow as the sum of (i) cash provided by operating activities and (ii) cash used for investing activities, minus (iii) changeof securities, (iv) contribution to plan assets of pension schemes, (v) realised treasury swaps and (vi) bank activities (“Free Cash Flow” or “FCF”). It is a key indicator which allows theCompany to measure the amount of cash flow generated from operations after cash used in investing activities.

levels of VR and LTIP will each amount to 100% of the CEO’s
Base Salary.

As illustrated in the table below, the structure of the CEO’s Total
Direct Compensation will remain unchanged in 2019. This will
apply in the same way to a future CEO. Indeed, the on-target

SCENARIOS CURRENT CEO TOTAL DIRECT COMPENSATION

Indications are based on the current CEO’s
remuneration and are in million euros.

Below Threshold
Target“Below Threshold” includes annual Base
Salary; VR at 0%; LTIP not vesting.

Maximum
0Base Salary

1

2

3

Variable Remuneration (VR)4

5

LTI paid in cash

6

7

8

LTI paid in shares“Target” includes Base Salary, VR at target
and LTIP grant face value in cash and inshares.
“Maximum” includes Base Salary; maximum
VR value (200% of VR at target); maximum
LTIP cash grant projected at vestingdate (250% of grant value); maximum
performance applicable to the number ofshares granted (150%). The share pricedevelopment is unpredictable. The final
value of Performance Shares cannot becapped.

Airbus / Registration Document 2018141

Corporate Governance /4.2 Interests of Directors and Principal Executive Officersc) Base Salary
The CEO’s Base Salary is determined by the Board of Directors, taking into account the peer group analysis mentioned above.
d) Annual Variable Remuneration
The Variable Remuneration is a cash payment that is paid
following the end of each financial year, depending on theachievement of specific and challenging performance targets
as determined at the beginning of each financial year. The levelof the CEO’s Variable Remuneration is targeted at 100% of theBase Salary; it is capped at a maximum level of 200% of theBase Salary. The entire Variable Remuneration is at-risk, andtherefore if performance targets are not achieved as per thedefined objectives agreed by the Board of Directors, no Variable
Remuneration is paid.
The performance measures that are considered when awarding
the Variable Remuneration to the CEO are split equally between
common collective performance measures and individual
performance measures.

Common Collective Component
The common collective component is based on EBIT (45%), Free Cash Flow (45%) and return on capital employed (“RoCE)” (10%)
objectives (“Common Collectve Component”). At the beginning of each year, the Board of Directors sets the targets for thesekey value drivers at Group and Division levels. The common collective financial targets relate closely to internal planning and to
guidance given to the capital markets (although there may be variations from these).
To calculate the common collective annual achievement levels, actual EBIT, Free Cash Flow and RoCE performance is comparedagainst the targets that were set for the year. This comparison forms the basis to computing achievement levels, noting thatthe actual EBIT, Free Cash Flow and RoCE levels are occasionally normalised for a limited number of factors which are outside
management control (such as certain foreign exchange impacts or unplanned merger and acquisition activities). The RNGC’s
intention is to ensure ambitious financial targets and to incentivise the CEO’s commitment to meeting these targets.

FCF (Free Cash Flow)
Annual, M€ (45%)

EBIT (Earnings before Interest & Tax)
Annual, M€ (45%)
Measures operational profitability
Driven by revenues and operating
expenses

Measures cash generation
Driven by cash provided by/used for operating
and investment activities

AirbusExecutives
commoncollective
financial
targets

RoCE
Annual, % (10%)
Measures how much profit is generated by
the capital invested in the business
Driven by operational and capital efficiency

In order to reinforce the alignment between the Company’s strategy, values and remuneration structure, the Company iscontemplating including in the Common Collective Component a specific R&S-related performance criterion in the future. The
RNGC will seek to ensure alignment of the chosen R&S criteria with the 2018 Company’s Priorities that are shared with all
employees, while also making sure that the criteria can be measured.

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REGISTRATION DOCUMENT 2018
Corporate Governance /4.2 Interests of Directors and Principal Executive Officers

Individual Component
The individual element (“Individual Component”) focuses on Outcomes and Behaviour (as defined below). Individual performanceis assessed in these two important dimensions:encompass various aspects of what the CEO
refers to the way results have been achieved,--Outcomes--Behaviour
can do to contribute to the success of the business: specificwhich is also critical for long-term success: how the CEO
business results he helps achieve, projects he drives andprocesses he helps improve. The individual targets of the
CEO are comprehensive and shared with all employees via
the 2018 Company Priorities;

and the Board of Directors work as a team, how the CEOleads the Executive Committee, quality of communication,encouragement of innovation, etc. A specific part of the
behaviour assessment relates to ethics, R&S and quality
issues.

e) Long-Term Incentive Plan
There are two types of Long-Term Incentive Plans (“Long-Term Incentive Plans” or “LTIP”): until 2015, LTIP was made up of
Performance Units (“Performance Units” or “Units”) only. Since 2016, following the approval of amendments by shareholders at 2016
AGM, the LTIP has been composed of a mix of Performance Units and Performance Shares (“Performance Shares” or “Shares”).
The value of the CEO’s LTIP allocation is capped as a percentage of the Base Salary at the date of grant and subject to performance
conditions.
The achievement of the performance criteria is assessed over a three-year period based on relevant financial criteria with stringent
targets set in advance and agreed by the Board of Directors, as demonstrated by past Company practices.

4

Both Performance Units and Performance Shares that vest can vary between 0% and 150% of the Units and Shares granted,
subject to cumulative performance over a three-year period. The level of vesting is subject to the following performance measures:
0-50% of the allocation: In principle, this element of the Performance Unit/Share award will not vest if the Company reports
negative cumulated EBIT results. Nonetheless, in case the Company’s EBIT results are impacted by exceptional and unpredictable
circumstances, the Board of Directors, upon recommendation of the RNGC, may decide that a maximum portion of 50% of
the allocation will vest;
50-150% of the allocation: This element of the Performance Unit/Shares vests based on the two following performance criteria:
average earnings per share (75%) (“Earnings Per Share” or “EPS”) and cumulative Free Cash Flow (25%). Before the 2013 plan,
it used to vest according to one performance criteria only: average Earnings Per Share.

---

Earnings per Share
Average over 3 years
Measures profitability
Driven by net income and number of shares

Free cash Flow
Cumulated over 3 years, M€
Measures cash generation
Driven by cash provided by/used for
operating and investment activities

For reasons of confidentiality, the precise targets set for the average EPS and cumulative Free Cash Flow, even though they havebeen properly established in a precise manner, cannot be publicly disclosed as these objectives are in part linked to the Company’s
strategy. Nonetheless, for the sake of transparency and to ensure compliance with best market practices, retrospective information
demonstrating the stringency of the targets set by the Board of Directors is provided for the previous Long-Term Incentive Plans.
The vesting of Performance Units and Shares is subject to the following maximum cap:the maximum level of vesting is 150% of the number of Units/Shares granted.

--

The vesting of Performance Units is subject to the following maximum caps:
the value that could result from share price increases is capped at 200% of the reference share price at the date of grant;
the overall pay-out is capped at 250% of the value at the date of grant---

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Corporate Governance /4.2 Interests of Directors and Principal Executive Officers

Performance Units plan characteristics(until and including 2015 plan)
Performance Units are the long-term equity-related incentive
awards that were granted to the CEO until 2015. LTIP awards
were granted each year. Each grant was subject to a threeyear cumulative performance objective. At the end of thethree-year period, the grant was subjected to a performance
calculation to determine whether and to what extent it shouldvest. Depending on continued employment, grants attributed
until 2013 vested in four tranches, the payment of which took
place approximately 6, 12, 18 and 24 months following theend of the performance period. Depending on continuous
employment, grants attributed in 2014 and 2015 would vest
in two tranches, the payment of which would take placeapproximately 6 and 18 months following the end of theperformance period.

At the date of grant, the CEO had to what portion of theallocation (subject to the performance calculation) was tobe released as cash payments and what portion was to beconverted into shares. At least 25% (and up to 75%) of theaward had to be deferred into shares, and would be releasedon the last vesting date. For the conversion into shares, one
Unit corresponds to one Airbus share.
For each payment in cash, one Unit is equal to the value of
one Airbus share at the time of vesting. The Airbus share value
is the average of the opening share price, on the Paris Stock
Exchange, during the 20 trading days preceding and including
the respective vesting dates.

LTIP-SCHEME 2014 AND 2015
Grants VEST in 2 tranches= 2 payment dates

GRANT DATE
Face value at grant date
Allocation policy

Y

Y+1

Y+2

Y+3

Performance period 3 years

Y+4

Y+5

Performance calculation
determines the number of Units
that may vest

Performance Units and Performance Shares characteristics(since 2016)
Since the 2016 plan, the CEO’s LTIP is comprised of a mix of
Performance Units and Performance Shares in order to increase
the alignment with shareholders’ interests. For each payment
in cash, one Unit is equal to the value of one Airbus share at
the time of vesting. The Airbus share value is the average ofthe opening share price, on the Paris Stock Exchange, during
the 20 trading days preceding and including the respective
vesting dates.
For the CEO, the value of the Performance Unit and Shareallocation is capped, at the time of grant, at 100% of the Base
Salary.

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Airbus / Registration Document 2018

At the end of the three-year period, the grant is subject to a
performance calculation to determine whether and to what
extent it should vest.
Depending on continued employment, Performance Units
attributed since 2016 will vest in two tranches, the paymentof which takes place approximately 6 and 18 months following
the end of the performance period. Performance Shares would
vest in one tranche, approximately 6 months following the endof the performance period.

REGISTRATION DOCUMENT 2018
Corporate Governance /4.2 Interests of Directors and Principal Executive Officers

LTIP-SCHEME SINCE 2016

GRANT DATE
Face value at grant date
Allocation policy

Y

Performance calculation
determines the number of Unitsand shares that may vest

Y+1

Y+2

Y+3

Y+4

Y+5

x
x

x

Performance period 3 years
Vesting in CASH
Vesting in SHARESf) Share Ownership Guidelinek) Contracts and Severance

The Board of Directors has established a share ownershipguideline pursuant to which the CEO is expected to acquire
Airbus shares with a value equal to 200% of the Base Salaryand to hold them throughout his tenure.

In the case of contract termination, the CEO is currently
entitled to an indemnity equal to 1.5 times the Total Target
Remuneration (defined as Base Salary and target Annual
Variable Remuneration) with respect to applicable local legal
requirements if any. This will not apply if the CEO mandate is
terminated for cause, in case of dismissal, if he resigns or if
the CEO has reached retirement age.

g) Benefits
The benefits offered to the CEO comprise a company car andaccident insurance. Travel cost reimbursements are based on
the Company travel policy as applicable to all employees.
h) Retirement
The CEO is entitled to a retirement benefit. The Company’s
policy is to provide a pension at retirement age that equals 50%of the Base Salary, once the CEO has served on the Executive
Committee for five years. This pension can increase graduallyto 60% of the Base Salary, for Executives who have served on
the Executive Committee for over ten years, and have been
employed for at least 12 years.
i) Clawback
Recent changes to Dutch law introduced the possibility for theCompany to deduct or claw back part of the CEO’s variable cash
remuneration (i.e. VR) or equity-related remuneration (excluding
the LTIP element settled in cash) served by the Company if
certain circumstances arise.
Any revision, claw back, or amounts deducted from the CEO’s
remuneration will be reported in the notes of the relevant
financial statements.
j) Loans
The Company does not provide loans or advances to the CEO.

4The CEO’s contract currently includes a non-competeclause which applies for a minimum of one year and can beextended at the Company’s initiative for a further year. The
Board of Directors has the discretion to invoke the extensionof the non‑compete clause. The compensation under the
non-compete clause is equal to 50% of the last Total Annual
Remuneration (defined as Base Salary and VR most recentlypaid) with respect to applicable local legal requirements if any
and paid in monthly instalments.
Past LTIP awards may be maintained, in such cases as in
the case of retirement or if a mandate is not renewed by theCompany without cause. The vesting of past LTIP awards
follows the plans’ rules and regulations including performance
conditions and is not accelerated in any case. LTIP awards
are forfeited for Executives who leave the Company on theirown initiative, but this is subject to review by the Board of
Directors.
Proposal of Policy from 2019 AGM onwards applicable toa future CEO
In order to comply with the recommendation of provision 3.2.3 ofthe Dutch Code relating to the maximum remuneration payablein the event of departure of an Executive Board Member and inline with market practices, the Board confirmed on 13 February
2019 a proposal from the RNGC that the amount of the indemnity
to be paid to the CEO in case of contract termination should be
reduced to one year’s salary. Consequently, the CEO will beentitled to an indemnity equal to one times the last Total Annual
Remuneration (defined as Base Salary and VR most recentlypaid), subject to applicable local legal requirements if any.

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Corporate Governance /4.2 Interests of Directors and Principal Executive Officers

The other terms and conditions applicable to the payment ofsuch indemnity, as per the remuneration policy currently in force,
will remain unchanged. In particular such indemnity will not
apply if the CEO’s mandate is terminated for a specific cause,in case of dismissal, if he resigns or if the CEO has reachedretirement age.
In addition, the Board confirmed on 13 February 2019 therecommendation of the RNGC to limit the non-competecompensation payable to the CEO in case of contract
termination to a maximum of one year. The other terms andconditions applicable to the non-compete compensation,as per the remuneration policy currently in force, will remainunchanged. In particular, the compensation will remain equal
to 50% of the last Total Annual Remuneration (defined as Base
Salary and VR most recently paid), subject to applicable local
legal requirements if any.
All other components of the remuneration policy will remainunchanged.

4.2.1.2 Non-Executive Remuneration –Applicable to Non-Executive Membersof the Board of Directors
The Company’s Remuneration Policy with regard to NonExecutive Members of the Board of Directors is aimed atensuring fair compensation and protecting the independenceof the Board’s Members.
Fees and Entitlements
Non-Executive Members of the Board are currently entitled to
the following:a base fee for membership or chair of the Board;a Committee fee for membership or chair on each of theBoard’s Committees; andan attendance fee for the attendance to Board meetings.

----

Each of these fees is a fixed amount. Non-Executive Membersof the Board do not receive any performance or equity-relatedcompensation, and do not accrue pension rights with theCompany in the frame of their mandate, except what they would
receive in the frame of a current or past Executive mandate.
These measures are designed to ensure the independence ofBoard Members and strengthen the overall effectiveness of theCompany’s corporate governance.
The Company does not encourage Non-Executive Directors topurchase Company shares.
Under the current policy, and since 2016, the fees havebeen reviewed to recognise the increase in Board Members’
responsibilities, their greater time commitment and Airbus’
continuous need to attract and retain highly competent Directors.
To incentivise Board attendance, the attendance fees havedoubled. Members of the Board are entitled to the following fees:
Fixed fee for membership of the Board (€ / year):
Chairman of the Board: € 210,000
Member of the Board: € 80,000

---

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Airbus / Registration Document 2018

Fixed fee for membership of a Committee (€ / year):
Chairman of a Committee: € 30,000
Member of a Committee: € 20,000---

Attendance fees (€ / Board meeting):€ 15,000--Chairman:--Member: € 10,000

Attendance fees shall decrease by 50% in case of an attendanceby phone or a Board meeting held by phone.
Committee chairmanship and Committee membership fees are
cumulative if the concerned Non-Executive Director belongs
to two different Committees. Fees are paid twice a year at
the end of each semester (as close as possible to the Board
meeting dates).
Proposal of Policy from 1 January 2019 onwards
applicable to Non-Executive Directors
In order to ensure continuous commitment of the Membersof the Board and Airbus’ ability to retain highly competent
members, regular reviews of the Board remuneration policy
are undertaken by the Company. Following the benchmark
performed in 2015, a comprehensive review of the remuneration
policy applicable to the Non-Executive Members of the Board
was undertaken in 2018.
In September 2018, the independent consultant Willis Towers
Watson completed a compensation benchmark for the NonExecutive Directors (incl. the Chairman of the Board) against
an extensive peer group.
This analysis encompassed approximately 50 comparable
companies in various indices from five countries (France,
Germany, Netherlands, Spain and the UK) and other large
companies from the aerospace and defence sector (including
BAE Systems, Boeing, Dassault Aviation, Honey wellInternational Inc., Lockheed Martin Corp., Northrop Grumman
Corp., Raytheon, Rolls Royce, Safran, Textron, Thales, United
Technologies Corp). Financial institutions were excluded fromthe peer group.
From the analysis, it appeared that the total target remuneration
for the non-Executive Board members (i) for membership ofthe Board of Directors (fixed and attendance fees) and (ii) for
membership of a Committee (fixed fee) are positioned within
the market spectrum of the Company’s peer group.
The remuneration policy for membership of a Committee has
been applicable since 2008 and only provides for a fixed fee
calculated on the basis of four regular meetings per Committee
per year.
However, since 2016, due to exceptional circumstances, theCommittees’ workload has significantly increased. The current
remuneration policy does not take into account directors’
attendance to a greater number of Committee meetings when
the workload substantially intensifies. Further, the current
remuneration policy does not take into account such temporary
increased intensity in the workload.

REGISTRATION DOCUMENT 2018
Corporate Governance /4.2 Interests of Directors and Principal Executive Officers

Therefore, in order to allow for a temporary increase in the
remuneration of the non-Executive Members of the Boardof Directors for their membership of a Committee when theworkload increases), the Board approved in October 2018
the recommendation of the RNGC to allocate the following
attendance fees per Committee above four Committee meetings
per year (whether these meetings are held physically or byphone):
in case of physical attendance: € 3,000 per additional meetingfor Members based in Europe and € 6,000 per additional
meeting for Members based outside Europe;in case of attendance by phone (whether the meeting is held
physically or by phone): € 1,500 per additional meeting.

---

Such attendance fee will be identical for both the Chair andMembers of a Committee.
As the fixed fees for membership of a Committee will remainunchanged (€ 30,000 for chair and € 20,000 for member), theallocation of an attendance fee per Committee above a certain
number of meetings per year will ensure automatic return to thecurrent level of remuneration when exceptional circumstances
end and workload decreases.
The contemplated total remuneration for membership ofa Committee (based on the average number of additional
Committee meetings effectively attended physically or by phoneby the Company’s directors in 2017 and 2018) will remain within
the market spectrum of the Company’s peer group (between
the median and Q3, as per the findings of the above-mentioned
benchmark).
Fixed fee for membership of the Board and attendance fees forattendance of Board meetings will remain unchanged.
Under the new policy, and in greater details, non-Executive
Members of the Board would be entitled to the following fees
for their membership of a Committee:
The proposal is to add an attendance fee per Committee
meeting above four meetings per year (whether these meetings
were held physically or by phone). The fixed fee would remainunchanged.
Fixed fee for membership of a Committee (€ / year):

30,000--Chairman:--Member of a Committee: 20,000

Attendance fee for membership of a Committee applicable tochair and members (€ / additional meeting above four meetings
per Committee per year, whether these meetings were held
physically or by phone):physical participation: 3,000 if the chair or member is basedin Europe and double attendance fee amount, i.e. 6,000 if thechair or member is based outside Europe;
participation by phone (whether the meeting is held physicallyor by phone): 1,500.

---

4.2.1.3

Proposed amendments
to the Remuneration Policy

At the 2019 AGM, the Board of Directors is proposing thatshareholders adopt the following amendments to the Airbus
Remuneration Policy:
Proposal of Policy from AGM 2019 onwards applicable to afuture CEO:In order to comply with the Dutch Code and in line with market
practices, the Board proposes, as described in details above,that the termination indemnity will be equal to one times the last
Total Annual Remuneration (defined as Base Salary and VR mostrecently paid) subject to applicable local legal requirements if
any, and that the non-compete clause will apply for a maximumof one year.
The other terms and conditions applicable to the terminationindemnity and the non-compete compensation as per the
remuneration policy currently in force will remain unchanged.
In particular the termination indemnity will not apply if the CEO’s
mandate is terminated for a specific cause, in case of dismissal,
if he resigns or if the CEO has reached retirement age and thenon-compete compensation will remain equal to 50% of thelast Total Annual Remuneration (defined as Base Salary andVR most recently paid).

4

Proposal of Policy from 1 January 2019 onwards applicable
to non executive directors:
In order to ensure continuous commitment of the Members of theBoard and Airbus’ ability to retain highly competent members,
the Company regularly reviews Board remuneration policy.
As described in detail above, in order to increase the remunerationof Non-Executive Directors who are Members of a Committee
when the workload of that Committee increases, the Company
proposes to allocate an attendance fee per Committee if and whensuch Committee would have more than four Committee meetings
per year (whether these meetings are held physically or by phone).
Such an attendance fee is identical for chair and membershipbut differs depending on whether attendance of the meetingis physical or by phone and, in case of physical attendance,
where the Committee Members are based.
As the fixed fees for membership of a Committee remain unchanged,
the proposed amendment will ensure the automatic return to thecurrent level of remuneration when workload decreases.
While incentivising attendance to the meetings and recognising
the key role of the Committees for the Board of Directors, thecontemplated total target remuneration (fixed and proposed
attendance fees) for membership of a Committee remains within
the market spectrum of the Company’s peer group, as per thefindings of the above-mentioned benchmark.
The other components of the remuneration policy will remainunchanged.

Airbus / Registration Document 2018147

Corporate Governance /4.2 Interests of Directors and Principal Executive Officers

4.2.1.4

Implementation of the Remuneration Policy: CEOa) Benchmarkingb) Base Salary

Based on a review the RNGC performed in 2018 with theassistance of an independent consultant, Willis Towers Watson,
it was concluded that the CEO’s Total Direct Compensation
was at the median level of the peer group as defined in
Section 4.2.1.1 a).

For 2018, the Base Salary of the current CEO remained at€ 1,500,000. The CEO’s Base Salary level was reviewed in 2015
and approved by shareholders at the 2016 AGM.
The Base Salary of the future CEO is € 1,350,000 on a full year
basis. Any increase of the future CEO’s Base Salary will also
take into consideration salary increases of employees acrossthe group.

c) Annual Variable Remuneration
As stipulated in the Company’s Remuneration Policy, the CEO’s VR is targeted at 100% of the Base Salary and capped at 200%of the Base Salary. It is subject to the fulfilment of collective and individual performance targets. This applies for both the current
and the future CEO.
For 2018, the VR of the current CEO amounted to an aggregate € 2,317,500 composed of € 967,500 (129%) for the Common
Collective Component and € 1,350,000 (180%) for the Individual Component.

Common Collective
Component:€ 967,500
Achievement:
129%

Total
Variable
Remuneration:€ 2,317,500

Individual part:€ 1,350,000
Achievement:
180%

At the end of the financial year 2018, the Common Collective Component results from a composite 129% achievement of
EBIT (45%), Free Cash Flow (45%) and RoCE (10%) objectives.

PERFORMANCE ACHIEVEMENT – COMMON COLLECTIVE COMPONENT 2018

EBIT

99%

FCF

156%

RoCE

146%

MinimumAchievement

148

Airbus / Registration Document 2018

= 129%

MaximumAchievement

REGISTRATION DOCUMENT 2018
Corporate Governance /4.2 Interests of Directors and Principal Executive Officers

This achievement mainly reflects a solid EBIT and strong Free
Cash Flow generation against the budgeted targets. The main
drivers of that success were the strong operational performanceand programme execution in all our businesses, in particular
record deliveries in Airbus, healthy pre-delivery payments
inflows, ongoing efforts to control working capital including
payment terms to suppliers and sound CapEx spending.
Finally, RoCE was below the target.
Normalisations were made to exclude exceptional events suchas currency exchange differences or those arising from phasing
mismatches.
The Individual part results from an excellent achievement levelof 180% out of 200%, assessed by the RNGC and approved by
the Board on the basis of the CEO’s performance and behaviour,mostly with respect to the four Airbus priorities agreed at thestart of the year. For each of these outcomes, leadership,
personal performance and contributions were examined.
The factors determining the assessment in 2018 were among
other achievements:
solid financial figures achieving the envisaged targets;record delivery achievements despite industrial challenges
especially on A320. Largest number of deliveries in Airbus
history, +11% vs. 2017;
good progress in industrial milestones of key development
programmes including first deliveries of Airbus A350-1000
and ULR;remarkable successful closing of the acquisition of Bombardier
C Series programme (A220 family) complementing the Airbus
product portfolio and integration into Airbus organisation as
C-SALP;strong sales performance in Airbus Helicopters with book-tobill above 1 and satisfactory delivery performance with 357
units within a high competitive market;------

result in Airbus Defence and Space, stabilisation of--solid
the A400M programme with good progress on capability

development, retrofit campaign and solid contractual
rebaselining. Record number of military aircraft deliveries andsatellite launches. Notable progress on future programmeswith key decisions on political level for UAS and FCAS;
strong key advancement in the Company’s further integration
through successful closure of the “Gemini” project bymerging Airbus and Airbus Group for a leaner and more
efficient management, helping to prepare the future of theCompany;
excellent progress on digital roadmap for product andservices offerings with Skywise and internal processes
with DDMS;
strong progress on innovation and R&T activities, growthin activities of Airbus ventures, establishing of innovation
centres with opening of Shenzhen innovation centre. Strongly
evolved Airbus role on UAM, exploration of new businessmodels and smart partnering for future trends;
strong and very successful steering of management transition
with selection, on-boarding and up-skilling of new C-level
leaders. Including the new CEO;strong and solid emphasis of ethics & compliance andresponsibility & sustainability as key pillars for future
developments. High momentum on values journey ensured
CEO and leadership team consistently demonstrate values
and behaviours and that E&C and R&S are interconnected
drivers of culture change;
reinforced efforts on diversity in all its forms.

------

4--

Due to the current CEO’s departure in 2019, the VR for 2019
amounts to an aggregate € 416,096 composed of € 208,048
for the Common Collective Component (100%) and € 208,048
for the Individual Component (100%).

d) Long-Term Incentive Plan
Granting 2018 and 2019
Due to the announcement of his departure, the current CEO has been granted neither Performance Units nor Performance
Shares for 2018 and 2019.
In 2019, the future CEO will be granted LTIPs in accordance with the applicable policy.
Vesting Values in 2018 for the current CEO
In 2018, the CEO received both cash payments and vested shares in connection with the vesting of 2013 and 2014 LTIP awards:
Cash: the total cash payment to the CEO amounted to € 1,364,541 in 2018 versus € 1,372,048 in 2017.
Shares:in connection with the 2013 LTIP award, the CEO had elected that 50% of his grant should be deferred into shares. Therefore, theCEO received 11,360 vested shares (11,192 vested shares in 2017) on the fourth vesting date for LTIP 2013 (5 November 2018);
in connection with the 2014 LTIP award, the CEO had elected that 25% of his grant should be deferred into shares. Therefore,
the vesting of 2,950 Performance Units for the LTIP 2014 will be released in the form of shares on the second vesting date forthe 2014 LTIP (which will take place in 2019).

-----

Airbus / Registration Document 2018149

Corporate Governance /4.2 Interests of Directors and Principal Executive Officers

LTIP Overview: Granting and Vesting

Date ofgrants

Grant
Type Number

Shareprice at
grant
date

Value atgrant date(Un)
conditional

Performanceachievement

Units withperformanceachievement

Dates ofvesting

Share value atvesting dates*
1st vesting –3 May 2017:€ 72.12

2013

Units

30,300€ 46.17€ 1,398,951

Conditional

75%

22,7244 vestings in
2017-2018

2nd vesting–
3 November 2017:€ 81.92
3rd vesting –3 May 2018:€ 92.34
4th vesting–
5 November 2018:€ 92.34

2014

Units

29,500€ 47.45€ 1,399,775

Conditional

80%

23,6002 vestings in
2018-2019

1st vesting –3 May 2018:€ 94.40

2015

Units

24,862€ 56.31€ 1,399,979

Conditional

75%

18,6482 vestings in
2019-2020

Not yet known

2016

Units

14,240€ 52.67€ 750,021

Conditional

Not yet known

Not yet known

2 vestings in
2020-2021

Not yet known2016

Shares

14,240€ 52.67€ 750,021

Conditional

Not yet known

Not yet known

1 vesting in
2020

Not yet known

2017

Units

10,162€ 73.81€ 750,057

Conditional

Not yet known

Not yet known

2 vestings in
2021-2022

Not yet known2017

Shares

10,162€ 73.81€ 750,057

Conditional

Not yet known

Not yet known

1 vesting in
2021

Not yet known

Calculations may involve rounding to the nearest unit.
* LTIP 2013 and 2014 cap was applied to the share price.
Vesting will occur according to the respective rules and regulations of each plan. There will be no accelerated vesting due to the current CEO’s departure in 2019.

Performance Conditions of LTIP 2015
The performance conditions for LTIP 2015 were determined as follows:

reports negative cumulated EBIT results, the Board of Directors can decide in its sole discretion to review the vesting--ifofAirbus
the Performance Units, including the 50% portion which is not subject to performance conditions;to 150% of the allocation would be granted depending on the compounded achievement of the two following performance--50%
criteria:--75% of average Earnings Per Share (“Ave EPS”): determined on a linear basis depending on three-year Ave EPS for the 2016,2017 and 2018 fiscal years, with the three-year Ave EPS target for an allocation of 100% equal to € 4.02,--and 25% of cumulative FCF (“Cum FCF”): determined on a linear basis depending on three-year Cum FCF for the 2016, 2017and 2018 fiscal years, with the three year Cum FCF target for an allocation of 100% equal to € 8,281m.

Review of Achievement of Performance Conditions
The Board of Directors on 13 February 2019 noted the achievement of the performance conditions of the 2015 plan, i.e. for the 2016,2017 and 2018 fiscal years. The three year Ave EPS was € 2.95 and the three-year Cum FCF was € 10,469m, after normalisation
to align them with policies in force when setting the target (notably IFRS 15 and A220 impacts).
LTIP 2015 PERFORMANCE ACHIEVEMENT

Ave EPS

Cum FCF50%
Performance achievement: € 2.95

Performance achievement: € 10,469m

MinimumAchievement

150

Airbus / Registration Document 2018

= 75%

150%

MaximumAchievement

REGISTRATION DOCUMENT 2018
Corporate Governance /4.2 Interests of Directors and Principal Executive Officers

Date ofgrants

KPI

Numberof units

Ave EPS2013

Cum FCF
before M&A

2014
2015

Ave EPS
Cum FCFAve EPS
Cum FCF

Target for
a 100%
allocation

Achieved

Performanceachievementin percentage€ 3.64€ 2.2850%€ 2,650m€ 3,440m

150%

Compounded
performanceachievementin percentage

Resultingvesting in
numberFor comparison,
average EPS for thelast 3 reported years
at the date of grant75%

22,724€ 1.15*80%

23,600€ 1.51**75%

18,646€ 2.10***30,30029,50024,862€ 3.31€ 2.8156%€ 4,298m€ 9,741m

150%€ 4.02€ 2.9550%€ 8,281m€ 10,469m

150%* Average EPS of 2012, 2011 and 2010.
** Average EPS of 2013, 2012 and 2011.
*** Average EPS of 2014, 2013 and 2012.

e) Share Ownership
The CEO owned 76,521 Company shares on 31 December
2018, which represents more than 200% of the base salary. He
herewith respects Airbus’ share ownership policy.

in valuation is due to changes in actuarial assumptions(e.g., mortality table, expected pension increase, retirement age).

Please refer to the AFM website www.afm.nl for any further
information related to the transactions of the CEO.

For the fiscal year 2018, the current service and interest costs
related to the CEO’s pension promise represented an expenseof € 1,136,706. This obligation has been accrued in the 2018
Consolidated Financial Statements.

f) Employee Share Ownership Plan (ESOP)i) Clawback

In March 2018, the Company offered all eligible employees theopportunity to subscribe to a share matching plan, throughwhich the Company matches a certain number of directly
acquired shares with a grant of matching shares. This ratio
varied depending on the number of shares acquired at fairmarket value by the employees, with a maximum discountof 44%. The total offering was up to 2.2 million shares of theCompany, open to all qualifying employees. Information about
the plan can be found on the Company’s website.
Under the umbrella of the ESOP 2018, a dedicated UK tax
advantageous Share Incentive Plan (“SIP”), was also deployedin March 2018.
Although the CEO was eligible for the plan, he did not participate
to the ESOP 2018 plan favouring the development of ashareholding among other employees of the Company.
g) Benefits
As stipulated in the Company’s Remuneration Policy the CEO’s
benefits comprise a company car and accident insurance. The
monetary value of these benefits for 2018 amounted to € 61,144.
h) Retirement
The defined benefit obligation for the current CEO’s pension
results from the Company’s pension policy as describedabove and takes into account: (i) the seniority of the CEO
in the Company and on its Executive Committee and (ii) thesignificantly lower public pension promise deriving from theGerman social security pension system, compared to a pension
resulting from membership in the French pension system. There
has been no change in the pension promise for the CEO in 2018.
The present value of the CEO’s pension obligation including
deferred compensation is estimated annually by an independentactuarial firm according to the international accounting standard
IAS19 as applied by the group for post-employment benefits. Asof 31 December 2018, the defined benefit obligation amounts
to € 26,303,940 vs. € 21,176,042 at the end of 2017. The change

4

The Board has not applied any clawback in 2018.
j) Pay ratio
The Dutch Corporate Governance Code recommends that theCompany provides a ratio comparing the compensation of the
CEO and that of a “representative reference group” determinedby the Company.
The Airbus pay ratio is calculated by comparing the cash
compensation of the CEO with a median full-time permanent
employee from France, Germany, UK and Spain for Airbus,
excluding subsidiaries.
The aggregate cash compensation over the 2018 fiscal year wasused as a reference amount (i.e. excluding the value of equity
incentive awards and other non-cash compensation components).
To calculate the ratio, the gross sum of the Base Salary, annual
bonus, profit and success sharing, overtime, premium for work
conditions and other premiums was taken in to account.
The full time equivalent headcount of this target European
population was taken into account.
Based on this methodology, the ratio between the cash
compensation of the CEO and the median full-time equivalentpermanent employee for the fiscal year to which this report
relates is 51 (rounded to the nearest integer). Airbus did notanalyse the ratios in comparison with the previous financial year,
because in 2017 ratios have not been calculated.
k) Contract and severanceWith regards to his planned departure and according to the policy,
the current CEO is not entitled to any termination indemnity.
The CEO’s contract includes a non-compete clause, which
will apply for one year. It will be paid in monthly instalments of€ 266,854.
Past LTIP awards are maintained. There will be no accelerated
vesting.

Airbus / Registration Document 2018151

Corporate Governance /4.2 Interests of Directors and Principal Executive Officers

4.2.1.6

Implementation of the Remuneration Policy in 2018:
Non-Executive Directors

The last review of the Board remuneration was undertaken in2015. The Board remuneration is in line with market practice,incentivises attendance and recognises the strategic role playedby the Board of Directors in Airbus’ developments. The CEO is
the only Member of the Board of Directors who is not entitledto any Board membership fee.
For personal reasons, and with regards to the implementationof remuneration policy approved at the AGM 2016, Denis
Ranque decided in 2016 and onwards to waive the portion of
his remuneration as Chairman of the Board of Directors which
exceeds € 240,000 (his total target remuneration for 2015, basedon six meetings per year and including chairmanship Board
fixum and attendance fees) until further notice.

Taking into account the increased number of Board meetings in
2018, the remuneration of Denis Ranque for 2018 as Chairmanof the Board of Directors (Board chairmanship fixum andattendance fees) is € 255,000.
Therefore, the Board recommended that the remuneration
exceeding € 255,000 would be converted into an annual
contribution to the Airbus Foundation as long as Denis Ranquewaived this part of his remuneration which corresponds to€ 67,500 based on the number of Board meetings in 2018.

The remuneration of the Non-Executive Members of the Board of Directors was as follows:
2018
Fixum(1)(In €)

2017

Attendancefees(2)

Total

Fixum(1)Attendancefees(2)

Total

Non-Executive Board Members
Denis Ranque

210,000

75,000285,000

204,293

80,000284,293

Victor Chu(5)72,37650,000122,37600072,37650,000122,37600

0100,000

75,000175,000

94,42080,000174,420

Lord Drayson(3)114,475

55,000169,475

72,10060,000132,100

Catherine Guillouard

120,000

75,000

195,000

120,000

70,000190,000

Hermann-Josef Lamberti

130,000

65,000

195,000

135,707

70,000205,707

María Amparo Moraleda Martínez

127,238

65,000192,238

120,000

80,000200,000

Claudia Nemat

100,000

75,000175,000

100,000

70,000170,000

René Obermann(5)72,37655,000127,376000Carlos Tavares

80,00050,000130,000

80,00065,000145,000

Hans-Peter Keitel(4)27,90010,00037,900100,000

60,000160,000

Lakshmi N. Mittal

0

0

0

28,176

10,00038,17636,27010,00046,270135,707

65,000200,707

27,90010,00037,900100,000

80,000180,000

1,290,910

720,000

2,010,910

1,290,403

790,000

2,080,403

Jean-Pierre Clamadieu(6)

Ralph D. Crosby Jr.

Former Non-Executive Board Members

Sir John Parker(4)Jean-Claude Trichet(4)Total(1) The fixum includes a base fee for a Board membership and a Committee fee membership within the Audit Committee, the Remuneration, Nomination and GovernanceCommittee (“RNGC”) and/or the Ethics & Compliance Committee (“E&C”). The fixum for the year 2018 was paid 50% in January 2018 and 50% in July 2018. The fixum for theyear 2017 was paid 50% in January 2017 and 50% in July 2017.
(2) The attendance fees related to the first semester 2018 were paid in July 2018, those related to the second semester 2018 were paid in January 2019. The attendance fees
related to the first semester 2017 were paid in July 2017, those related to the second semester 2017 were paid in January 2018.
(3) Member of the E&C Committee as of 11 April 2018.
(4) Not a Member of the Company Board of Directors as of 11 April 2018.
(5) Member of the Company Board of Directors and the AC as of 11 April 2018.
(6) Member of the Company Board of Directors and the RNGC as of 11 April 2018.

4.2.2 Long-Term Incentives Granted to the Chief Executive Officer
See “— 4.3.3 Long-Term Incentive Plans”.

152

Airbus / Registration Document 2018

REGISTRATION DOCUMENT 2018
Corporate Governance /4.3 Employee Profit Sharing and Incentive Plans

4.2.3 Related Party Transactions
Reflecting Article 2:129(6) of the Dutch Civil Code, Article 18.5 of
the Articles of Association provides that “a Director shall not takepart in the deliberations or decision-making if he has a direct
or indirect personal interest which conflicts with the interestsof the Company and of the enterprise connected with it. If asa result thereof no resolution of the Board of Directors can be
adopted, the resolution is adopted by the General Meeting”.
During the years 2016, 2017 and 2018, no agreement wasentered into by the Company with one of its Directors or principal
officers or a shareholder holding more than 5% of the voting
rights of the Company outside the ordinary course of businessand in conditions other than arm’s length conditions. For more
information, please refer to the “— Notes to the IFRS Consolidated

Financial Statements — Note 8: Related party transactions”
for the year ended 31 December 2018 and “— Notes to the
IFRS Consolidated Financial Statements — Note 8: Related
party transactions” for the year ended 31 December 2017, asincorporated by reference herein.
For a description of the relationships between the Company
and its principal shareholders, see “— General Description of
the Company and its Shareholders — 3.3.2 Relationships with
Principal Shareholders”. Other than the relationships between
the Company and its principal shareholders described therein,
there are no potential conflicts of interest between the duties
to the Company of the Directors and their respective privateinterests or other duties.

4.3 Employee Profit Sharing and Incentive Plans

4

4.3.1 Employee Profit Sharing and Incentive Agreements
The Company’s remuneration policy is strongly linked to theachievement of individual and Company objectives, both for each
Division and for the overall Company. In 2012, a Performance andRestricted Unit plan was established for the senior management of
Airbus (see “— 4.3.3 Long-Term Incentive Plans”), and employees
were offered shares at favourable conditions within the context ofa new Employee Share Ownership Plan (see “— 4.3.2 Employee
Share Ownership Plans”).

The success sharing schemes which are implemented at theCompany in France, Germany, Spain and the UK follow one setof common rules of the group, ensuring a consistent applicationin these four countries.

4.3.2 Employee Share Ownership Plans
Enabling employees to participate in the results of the Company
is a key element in the Airbus benefits policy. Since its creation,
the Company has developed a philosophy based on sharing
the added value created by the Company with all employees(including the CEO). Therefore, the Company has regularly
offered qualifying employees the opportunity to purchase shareson favourable terms through the ESOP.

According to shareholders’ resolutions adopted at the AGM, thepowers to issue shares and to set aside preferential subscription
rights of existing shareholders have been granted to the Boardof Directors at the 2018 AGM. Such powers include the approvalof ESOP.

Airbus / Registration Document 2018153

Corporate Governance /4.3 Employee Profit Sharing and Incentive Plans

The following table summarises the main terms of the ESOPs conducted over the last three years:
Year

Price per shareNominal value per share

Number of shares issued

Date of issuance2013€ 42.02 / € 44.20€12,113,245

29 July 20132015

€ 49.70(1) /€ 51.63(2) /€ 65.59(4)€1€11,436,901
102,11321 April 2015
November 20152016

€ 54.31(1) / € 55.41(2) € /55.53(5)€1

1,366,893
107,823

14 April 201618 November 20162017

€ 64.44(1) / € 67.24(2) /€ 85.20(6)€1€11,554,611
88,582

3 May 201721 November 20172018

€ 88.65(1) / € 84.17(2) /€ 92.57(7)€1€11,739,390
72,4293 May 2018
20 November 2018

(1)

2014

(2)
(3)

(1) Shares purchased within context of group employee savings plan.
(2) Shares purchased directly.
(3) July 2014 the Board of Directors decided to cancel the ESOP scheme for 2014 due to volatility of the share price and the financial situation.
(4) Under the umbrella of the ESOP 2015, a dedicated UK tax advantageous Share Incentive Plan, SIP, was also deployed.
(5) Under the umbrella of the ESOP 2016, a dedicated UK tax advantageous Share Incentive Plan, SIP, was also deployed.
(6) Under the umbrella of the ESOP 2017, a dedicated UK tax advantageous Share Incentive Plan, SIP, was also deployed.
(7) Under the umbrella of the ESOP 2018, a dedicated UK tax advantageous Share Incentive Plan, SIP, was also deployed.

In 2018 and 2017, the Board of Directors approved a new
ESOP scheme. Eligible employees were able to purchasea fixed number of previously unissued shares at fair market
value (2018: 5, 15, 30, 50 or 100 shares; 2017: 5, 20, 30, 50 or
100 shares). Airbus matched each fixed number of shares witha number of the Company free shares based on a determinedratio (2018: 4, 7, 10, 13 and 25 free shares, respectively 2017:
4, 8, 10, 13 and 25 free shares, respectively). During a custodyperiod of at least one year or, provided the purchase took placein the context of a mutual fund (regular savings plan), of five
years, employees are restricted from selling the shares, but havethe right to receive all dividends paid. Employees who directly
purchased the Company shares have, in addition, the ability
to vote at the Annual Shareholder Meetings. The subscription
price was equal to the closing price at the Paris stock exchange
on 14 February 2018 (2017: 21 February 2017) and amounted

154

Airbus / Registration Document 2018

to € 84.17 (2017: € 67.24). Investing through the mutual fund
led to a price which corresponds to the average price at theParis stock exchange during the 20 trading days immediately
preceding 14 February 2018 (2017: 21 February 2017), resulting
in a price of € 88.65 (2017: € 64.44). The Company issued andsold 446,059 ordinary shares (2017: 411,710) with a nominal
value of € 1.00 each. Compensation expense (excluding social
security contributions) of € 38 million (2017: € 28 million) was
recognised in connection with ESOP. The Company intends toimplement an ESOP in 2019, subject to approval by the Boardof Directors, open to all qualifying employees (including theCEO). With future ESOP, the Company intends to offer sharesto eligible employees through the issuance of shares or free
distribution of shares or other existing or new securities giving
access to the capital as a matching contribution. This plan would
aim at favouring the development of employee shareholding.

REGISTRATION DOCUMENT 2018
Corporate Governance /4.3 Employee Profit Sharing and Incentive Plans

4.3.3 Long-Term Incentive Plans
In 2012, 2013, 2014, 2015, and 2016, based on the authorisation
granted to it by the shareholders’ meetings (see dates below), theBoard of Directors approved the granting of LTIP Performance
Units and Restricted Units in the Company. The grant of
so-called “units” will not physically be settled in shares but
represents a cash-settled plan in accordance with IFRS 2. Since
2017, the Board of Directors approved an LTIP Performance
Units and Performance Share Plan.

The principal characteristics of these options as well as
Performance and Restricted Units as of 31 December 2018
are set out in the “Notes to the IFRS Consolidated Financial
Statements — Note 30: Share-based payment”. They are also
summarised in the tables below:

Fifteenth tranche
Date of Board of Directors meeting (grant date)

13 November 2013
Performance and Restricted Unit plan

Number of units granted(1)Performance Units

Restricted Units

1,245,052

359,0600030,300-173,100-

Number of units outstanding
Units granted to:-- Mr. Thomas Enders*-- the 10 employees having being granted
the highest number of units during
the year 2013 (fifteenth tranche)

Total number of eligible beneficiaries

Vesting dates
Number of vested units

4

1,709
The Performance and Restricted Units will vest if the participant is still employedby an Airbus company at the respective vesting dates and, in the caseof Performance Units, upon achievement of mid-term business performance.
Vesting schedule is made up of 4 payments over 2 years:
25% expected in May 2017;25% expected in November 2017;25% expected in May 2018;
25% expected in November 2018.

-----855,686

333,415(1) Based on 100% target performance achievement. A minimum of 50% of Performance Units will vest; 100% in case of on-target performance achievement; up to a maximum of
150% in case of overachievement of performance criteria. In case of absolute negative results (cumulative EBIT* of Airbus) during the performance period, the Board of Directors
can decide to review the vesting of the Performance Units including the 50% portion which is not subject to performance conditions (additional vesting condition).
* For more information in respect of units granted to the Chief Executive Officer, please refer to the “Notes to the IFRS Consolidated Financial Statements — Note 31: Remuneration”.

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Corporate Governance /4.3 Employee Profit Sharing and Incentive Plans

Sixteenth tranche
Date of Board of Directors meeting (grant date)

13 November 2014
Performance and Restricted Unit plan
Performance Units

Restricted Units

Number of units granted(1)1,114,962

291,420

Number of units outstanding

424,260

134,198

29,500-176,460-

Units granted to:-- Mr. Thomas Enders*-- the 10 employees having being granted
the highest number of units during
the year 2014 (sixteenth tranche)

Total number of eligible beneficiaries

1,621
The Performance and Restricted Units will vest if the participant is still employedby an Airbus company at the respective vesting dates and, in the caseof Performance Units, upon achievement of mid-term business performance.
Vesting schedule is made up of 2 payments over 2 years:
50% expected in June 2018;
50% expected in June 2019.

---

Vesting dates
Number of vested units

399,540

138,527(1) Based on 100% target performance achievement. A minimum of 50% of Performance Units will vest; 100% in case of on-target performance achievement; up to a maximum of
150% in case of overachievement of performance criteria. In case of absolute negative results (cumulative EBIT* of Airbus) during the performance period, the Board of Directors
can decide to review the vesting of the Performance Units including the 50% portion which is not subject to performance conditions (additional vesting condition).
* For more information in respect of units granted to the Chief Executive Officer, please refer to the “Notes to the IFRS Consolidated Financial Statements — Note 31: Remuneration”.

Seventeenth tranche
Date of Board of Directors meeting (grant date)

29 October 2015
Performance and Restricted Unit plan
Performance Units

Number of units granted(1)

Number of units outstanding

Restricted Units

926,398

240,972

656,406

231,396

24,862-

Units granted to:-- Mr. Thomas Enders*-- the 10 employees having being granted
the highest number of units during
the year 2015 (seventeenth tranche)

156,446-

Total number of eligible beneficiaries

Vesting dates
Number of vested units

1,564
The Performance and Restricted Units will vest if the participant is still employedby an Airbus company at the respective vesting dates and, in the caseof Performance Units, upon achievement of mid-term business performance.
Vesting schedule is made up of 2 payments over 2 years:
50% expected in June 2019;50% expected in June 2020.

---

2,606

-

(1) Based on 100% target performance achievement. A minimum of 50% of Performance Units will vest; 100% in case of on-target performance achievement; up to a maximum of
150% in case of overachievement of performance criteria. In case of absolute negative results (cumulative EBIT* of Airbus) during the performance period, the Board of Directors
can decide to review the vesting of the Performance Units including the 50% portion which is not subject to performance conditions (additional vesting condition).
* For more information in respect of units granted to the Chief Executive Officer, please refer to the “Notes to the IFRS Consolidated Financial Statements — Note 31: Remuneration”.

156

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REGISTRATION DOCUMENT 2018
Corporate Governance /4.3 Employee Profit Sharing and Incentive Plans

Eighteenth tranche
Date of Board of Directors meeting (grant date)

25 October 2016
Performance Units and Performance Shares plan
Performance Units

Performance Shares

Number of units/shares granted(1)592,391

594,561

Number of units/shares outstanding

605,789

611,225

14,24014,24079,50485,200

Units/shares granted to:-- Mr. Thomas Enders*-- the 10 employees having being granted

the highest number of units/shares during
the year 2016 (eighteenth tranche)

Total number of eligible beneficiaries

1,671
The Performance Units and Shares will vest if the participant is still employedby an Airbus company at the respective vesting dates and, in the case of
Performance Units and Shares, upon achievement of mid-term business performance.
Vesting schedule is made up of 2 payments over 2 years:
Performance Units:
50% expected in May 2020;
50% expected in May 2021;
Performance Shares: 100% expected in May 2020-----

Vesting dates
Number of vested units

-

4

-

(1) Based on 100% target performance achievement. A minimum of 50% of Performance Units will vest; 100% in case of on-target performance achievement; up to a maximum of
150% in case of overachievement of performance criteria. In case of absolute negative results (cumulative EBIT* of Airbus) during the performance period, the Board of Directors
can decide to review the vesting of the Performance Units including the 50% portion which is not subject to performance conditions (additional vesting condition).
* For more information in respect of units granted to the Chief Executive Officer, please refer to the “Notes to the IFRS Consolidated Financial Statements — Note 31: Remuneration”.

Nineteenth tranche
Date of Board of Directors meeting (grant date)

30 October 2017
Performance Units and Performance Shares plan
Performance Units

Number of units/shares granted(1)

Number of units/shares outstanding

Performance Shares

421,638

425,702411,841

415,905

10,162

10,162

Units/shares granted to:-- Mr. Thomas Enders*-- the 10 employees having being granted

the highest number of units/shares during
the year 2017 (eighteenth tranche)

53,808

Total number of eligible beneficiaries

Vesting dates
Number of vested units

57,872
1,601

The Performance Units and Shares will vest if the participant is still employedby an Airbus company at the respective vesting dates and, in the case of
Performance Units and Shares, upon achievement of mid-term business performance.
Vesting schedule is made up of 2 payments over 2 years:
Performance Units:
50% expected in May 2021;
50% expected in May 2022;
Performance Shares: 100% expected in May 2021

-----

-

-

(1) Based on 100% target performance achievement. A minimum of 50% of Performance Units will vest; 100% in case of on-target performance achievement; up to a maximum of
150% in case of overachievement of performance criteria. In case of absolute negative results (cumulative EBIT* of Airbus) during the performance period, the Board of Directors
can decide to review the vesting of the Performance Units including the 50% portion which is not subject to performance conditions (additional vesting condition).
* For more information in respect of units granted to the Chief Executive Officer, please refer to the “Notes to the IFRS Consolidated Financial Statements — Note 31: Remuneration”.

Airbus / Registration Document 2018157

Corporate Governance /4.3 Employee Profit Sharing and Incentive Plans

Twentieth tranche
Date of Board of Directors meeting (grant date)

30 October 2018
Performance Units and Performance Shares plan
Performance Units

Performance Shares

Number of units/shares granted(1)278,376

281,181

Number of units/shares outstanding

278,376

281,1810023,57826,383

Units/shares granted to:-- Mr. Thomas Enders*-- the 10 employees having being granted

the highest number of units/shares during theyear 2018 (eighteenth tranche)

Total number of eligible beneficiaries

Vesting dates
Number of vested units

1,626
The Performance Units and Shares will vest if the participant is still employedby an Airbus company at the respective vesting dates and, in the case of
Performance Units and Shares, upon achievement of mid-term business performance.
Vesting schedule is made up of 2 payments over 2 years:
Performance Units:
50% expected in May 2022;
50% expected in May 2023;
Performance Shares: 100% expected in May 2022

-----

-

-

(1) Based on 100% target performance achievement. A minimum of 50% of Performance Units will vest; 100% in case of on-target performance achievement; up to a maximum of
150% in case of overachievement of performance criteria. In case of absolute negative results (cumulative EBIT* of Airbus) during the performance period, the Board of Directors
can decide to review the vesting of the Performance Units including the 50% portion which is not subject to performance conditions (additional vesting condition).
* For more information in respect of units granted to the Chief Executive Officer, please refer to the “Notes to the IFRS Consolidated Financial Statements — Note 31: Remuneration”.

The information in respect of stock options and performance and restricted shares cancelled and exercised during the year are
set out in “Notes to the IFRS Consolidated Financial Statements — Note 30: Share-based payment”.
SHAREHOLDING IN THE COMPANY OF THE MEMBERS OF THE BOARD OF DIRECTORS AT THE END OF 2018
Member of the Board of Directors-- Mr. Thomas Enders-- Mr. Denis Ranque-- Ms. Catherine Guillouard-- Mr. Ralph Dozier Crosby, Jr.
No other Member of the Board of Directors holds shares or other securities in the Company.

158

Airbus / Registration Document 2018

Shareholding
76,521 ordinary shares
2,000 ordinary shares
185 ordinary shares
12 ordinary shares

REGISTRATION DOCUMENT 2018
Corporate Governance /4

Airbus / Registration Document 2018

159

5
Chapter160

Airbus / Registration Document 2018

5

General Information

5.1

Entity Responsible
for the Registration Document

162Statement of the Entity Responsible
for the Registration Document

162

5.3

Information Policy

162

5.4

Undertakings of the Company
regarding Information

163

5.5

Significant Changes

163

5.6

Statement on Approval

163

5.2

Airbus / Registration Document 2018161

General Information /5.1 Entity Responsible for the Registration Document

5.1 Entity Responsible for the Registration Document
Airbus SE

5.2 Statement of the Entity Responsible
for the Registration Document
The Company declares that, having taken all reasonable care to ensure that such is the case, the information contained in
the document is, to the best of the Company’s knowledge, in accordance with the facts and contains no omission likely to affectits import.
Airbus SE represented by:
Guillaume Faury
Chief Executive Officer

5.3 Information Policy
details for information:--Contact
Mr Thorsten Fischer

Head of Investor Relations and Financial Communication,
Airbus SE
2 rond-point Émilie Dewoitine
BP 9011231703 Blagnac France
Telephone: +33 5 82 05 53 01
E-mail: ir@airbus.com

toll-free hotlines are available to shareholders in--Special
France (0 800 01 2001), Germany (00 800 00 02 2002) andSpain (00 800 00 02 2002). An international number is alsoavailable for the rest of the world (+33 800 01 2001)

e-mail box is dedicated to shareholders’ messages:--An
ir@airbus.com

A website, www.airbus.com, provides a wide range of
information on the Company, including the Board of Directors’
report. Additionally, for the life of this Registration Document,
copies of:
the Company’s Articles of Association;
the Registration Document filed in English with, and approved
by, the AFM on 4 April 2017;
the Registration Document filed in English with, and approved
by, the AFM on 28 March 2018; andthe Consolidated Financial Statements (IFRS) and theCompany Financial Statements of Airbus SE for the years
ended 31 December 2017 and 2018, together with therelated Auditors’ reports, may be inspected at the Company’s
registered office at: Airbus SE, Mendelweg 30, 2333 CS
Leiden, the Netherlands, Seat (statutaire zetel) Amsterdam,
Tel.: +31 (0)71 5245 600.

-----

The information on the website of the Company does not form
part of the Registration Document unless that information isincorporated by reference into the Registration Document.

162

Airbus / Registration Document 2018

REGISTRATION DOCUMENT 2018
General Information /5.6 Statement on Approval

5.4 Undertakings of the Company regarding
Information
Given the fact that the shares of the Company are listed onEuronext Paris, on the regulierter Markt (in the sub-segment
Prime Standard) of the Frankfurt Stock Exchange and on the
Madrid, Bilbao, Barcelona and Valencia Stock Exchanges, theCompany is subject to certain laws and regulations applicablein France, Germany and Spain in relation to information, themain ones of which are summarised in “General Description of
the Company and its Share Capital — 3.1.3 Governing Laws
and Disclosures”.

5.5 Significant Changes
As of the date of the Registration Document, there has been no significant change in the Company’s financial performance or
financial position since 31 March 2019.

5

5.6 Statement on Approval
This Registration Document has been approved by the AFM on 29 July 2019 in its capacity as competent authority under Regulation(EU) 2017/1129. The AFM only approves this Registration Document as meeting the standards of completeness, comprehensibility
and consistency imposed by the Prospectus Regulation and such approval should not be considered as an endorsement of theissuer that is the subject of this Registration Document. This Registration Document may be used for the purposes of an offerto the public of securities or admission of securities to trading on a regulated market if completed by amendments, if applicable,
and a securities note and summary approved in accordance with the Prospectus Regulation.

Airbus / Registration Document 2018163

Airbus SE
Mendelweg 302333 CS Leiden
The Netherlands
164

Airbus / Registration Document 2018