2017

Registration
Document

02

Registration Document 2017 - AIRBUS

Airbus SE (the “Company”) is a European publiccompany (Societas Europaea), with its seat inAmsterdam, The Netherlands, which is listed
in France, Germany and Spain. The applicableregulations with respect to public information andprotection of investors, as well as the commitments
made by the Company to securities and market
authorities, are described in this Registration
Document (the “Registration Document”).
In 2017, there were no changes to the segment
reporting. Nevertheless as a result of the relabellingto a single Airbus brand, the Company together
with its subsidiaries is referred to as “Airbus”
and no longer the Group. Consequently, thesegment formerly known as Airbus is referred toas “Airbus Commercial Aircraft” for the purposeof 2017 ﬁnancial reporting. 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 identiﬁedby 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 ofstrategy. These statements relate to the Company’s
future prospects, developments and businessstrategies and are based on analyses or forecastsof future results and estimates of amounts not yet
determinable. These forward-looking statements
represent the view of the Company only as of thedates they are made, and the Company disclaims
any obligation to update forward-looking statements,
except as may be otherwise required by law. The
forward-looking statements in this Registration
Document involve known and unknown risks,
uncertainties and other factors that could cause
the Company’s actual future results, performanceand achievements to differ materially from those
forecasted or suggested herein. These include
changes in general economic and businessconditions, as well as the factors described under“Risk Factors” below.
This Registration Document was prepared inaccordance with Annex 1 of EC Regulation
No. 809 / 2004, filed in English with, and approved
by, the Autoriteit Financiële Markten (the “AFM”)
on 28 March 2018 in its capacity as competentauthority under the Wet op het ﬁnancieel toezicht(as amended) pursuant to Directive 2003 / 71 / EC.
This Registration Document may be used insupport of a financial transaction as a document
forming part of a prospectus in accordance with
Directive 2003 / 71 / EC only if it is supplemented
by a securities note and a summary approved by
the AFM.

REGISTRATION DOCUMENT 2017

03

Risk Factors
1_ Information on Airbus Activities
2_ Management’s Discussion and Analysisof Financial Condition and Results of Operations
3_ General Description of the Company
and its Share Capital
4_ Corporate Governance
5_ Entity Responsible
for the Registration Document

2017

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Registration Document 2017 - AIRBUS

Registration
Document
2017
/1

Table
of contents

Information on Airbus Activities

23

1.1

Presentation of the Company

24

1.1.1
1.1.2
1.1.3
1.1.4
1.1.5
1.1.6
1.1.7
1.1.8

Overview
Commercial Aircraft
Helicopters
Defence and Space
Investments
Insurance
Legal and Arbitration Proceedings
Non-Financial Information

24
28
37
40
47
47
47
50

1.2

Recent Developments

72/2
Risk Factors

07

Management’s Discussion and Analysisof Financial Condition and Resultsof Operations
75

1.

08

2.1

Financial Market Risks

2.

Business-Related Risks

12

3.

Legal Risks

18

4.

Industrial and Environmental Risks

21

Operating and Financial Review

76

2.1.1 Overview
2.1.2 Signiﬁcant Accounting Considerations,
Policies and Estimates
2.1.3 Performance Measures
2.1.4 Results of Operations
2.1.5 Changes in Consolidated Total Equity(Including Non-Controlling Interests)
2.1.6 Liquidity and Capital Resources
2.1.7 Hedging Activities

77

89
90
94

2.2

Financial Statements

94

2.3

Statutory Auditors’ Fees

95

2.4

Information Regarding the Statutory Auditors

95

79
80
85

REGISTRATION DOCUMENT 2017

/3

05

/4

General Description of the Company
and its Share Capital

97

Corporate
Governance

119

3.1

98

4.1

Management and Control

120

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

120

General Description of the Company

3.1.1 Commercial and Corporate Names,
Seat and Registered Ofﬁce
98
3.1.2 Legal Form
98
3.1.3 Governing Laws and Disclosures98
3.1.4 Date of Incorporation and Duration of the Company 100
3.1.5 Objects of the Company
100
3.1.6 Commercial and Companies Registry100
3.1.7 Inspection of Corporate Documents
100
3.1.8 Financial Year100
3.1.9 Allocation and Distribution of Income
101
3.1.10 General Meetings101
3.1.11 Disclosure of Holdings
102
3.1.12 Mandatory Disposal
104
3.1.13 Mandatory Offers
105

3.2

General Description of the Share Capital

105
105
105

4.2

Interests of Directors and Principal
Executive Ofﬁcers

154
155

4.3

155

Employee Proﬁt Sharing and Incentive Plans

4.3.1 Employee Proﬁt Sharing andIncentive Agreements
4.3.2 Employee Share Ownership Plans
4.3.3 Long-Term Incentive Plans

106
107
107

/5

3.3

Entity Responsible for
the Registration Document

Shareholdings and Voting Rights

108
108
109
111
112
112
112
114

3.4

Dividends

116

3.4.1
3.4.2
3.4.3
3.4.4

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

116
116
116
116

144

4.2.1 Remuneration Policy
4.2.2 Long-Term Incentives Granted to
the Chief Executive Ofﬁcer
4.2.3 Related Party Transactions

3.2.1 Issued Share Capital
3.2.2 Authorised Share Capital
3.2.3 Modiﬁcation of Share Capitalor Rights Attached to the Shares
3.2.4 Securities Granting Accessto the Company’s Share Capital
3.2.5 Changes in the Issued Share Capital

3.3.1 Shareholding Structure at the End of 2017
3.3.2 Relationships with Principal Shareholders
3.3.3 Form of Shares
3.3.4 Changes in the Shareholding of the Company
3.3.5 Persons Exercising Control over the Company
3.3.6 Simpliﬁed Group Structure Chart
3.3.7 Purchase by the Company of its Own Shares

140
141
143

5.1

144

155
155
157

163

Entity Responsible for
the Registration Document

164

Statement of the Entity Responsible
for the Registration Document

164

5.3

Information Policy

165

5.4

Undertakings of the Company
regarding Information

165

Signiﬁcant Changes

165

5.2

5.5

06

Registration Document 2017 - AIRBUS

2017

Risk
Factors

REGISTRATION DOCUMENT 2017

07

Risk
Factors

1.

Financial Market Risks

08

2.

Business-Related Risks

12

3.

Legal Risks

18

4.

Industrial and Environmental Risks

21

08

Registration Document 2017 - AIRBUS
Risk Factors
1 Financial Market Risks

The Company is subject to many risks and uncertainties that may affectits ﬁnancial performance. The business, results of operations or ﬁnancial
condition of the Company could be materially adversely affected by therisks described below. These are not the only risks the Company faces.
Additional risks and uncertainties not presently known to the Company
or that it currently considers immaterial may also impair its businessand operations.

1.

Financial Market Risks

Global Economic Concerns

As a global company, the Company’s operations and performance
depend signiﬁcantly on market and economic conditions in
Europe, the US, Asia and the rest of the world. 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 or defaults, or adverse geopoliticalevents (including the impact of Brexit, discussed below, US policy
and elections in Europe). Any such disruption or downturn could
affect the Company’s activities for short or extended periods andhave a negative effect on the Company’s ﬁnancial condition andresults of operations.
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.
Although the terms of the UK’s post-Brexit relationship with
the EU are still unknown, the Company may be affected bypotentially divergent national laws and regulations between
the EU and the UK. This may include greater restrictions on
the importing and exporting of goods and services between
the UK and EU countries in which the Company operates
along with costly new tariffs and increased regulatory and legal
complexities. The free movement of people and skilled labour
may also be limited by new border controls.
The administration of US President Donald Trump has introduced
greater uncertainty with respect to US tax and trade policies,
tariffs and government regulations affecting trade between the
US and other countries.
Although the impact of these geopolitical events cannot
reasonably be assessed, the consequences could have anegative effect on the Company’s ﬁnancial condition and resultsof operations.

If economic conditions were to deteriorate, or if more pronounced
market disruptions were to occur, there could be a new orincremental tightening in the credit markets, low liquidity, andextreme volatility in credit, currency, commodity and equity
markets. This could have a number of effects on the Company’sbusiness, including:■requests by customers to postpone or cancel existing orders
for aircraft (including helicopters) or decisions by customers toreview their order intake strategy due to, among other things,
lack of adequate credit supply from the market to ﬁnanceaircraft purchases or change in operating costs or weak levelsof passenger demand for air travel and cargo activity moregenerally;■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;■
variations in public spending for defence, homeland security
and space activities;■
ﬁnancial instability, inability to obtain credit or insolvency on thepart of key suppliers and subcontractors, thereby impacting
the Company’s ability to meet its customer obligations in asatisfactory and timely manner;■continued de-leveraging as well as mergers, rating
downgrades and bankruptcies of banks or other ﬁnancial
institutions, resulting in a smaller universe of counterparties
and lower availability of credit, which may in turn reduce theavailability of bank guarantees needed by the Company for its
businesses or restrict its ability to implement desired foreign
currency hedges;■
default of investment or derivative counterparties and otherfinancial institutions, which could negatively impact theCompany’s treasury operations including the cash assets of
the Company; andREGISTRATION DOCUMENT 2017
Risk Factors
1 Financial Market Risks■

decreased performance of Airbus’ cash investments due tolow and partly negative interest rates.

The Company’s financial results could also be negatively
affected depending on gains or losses realised on the saleor exchange of ﬁ nancial 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.
In the Commercial Aircraft activities, revision clauses in sales
contracts and in supplier contracts can be based on different
indexes and therefore can evolve differently.

Foreign Currency Exposure

Airbus is exposed to certain price risks such as foreign exchange
rate as well as interest rate risks, changes in commodity prices
and in the price of its own stocks. Adverse movements of theseprices may jeopardise Airbus’ proﬁtability if not hedged. Airbus
intends to generate proﬁts only from its operations and not
through speculation on the development of such prices. Airbus
uses hedging strategies to manage and minimise the impact ofsuch price ﬂuctuations on its proﬁts, including foreign currency
derivative contracts, interest rate and equity swaps and othernon-derivative ﬁnancial assets or liabilities denominated in aforeign currency.
The major part of its hedging activities is devoted to foreignexchange risks, as a signiﬁ cant portion of the Company’s
revenues is denominated in US dollars, while a major portionof its costs is incurred in euro, and to a lesser extent, in pounds
sterling. Consequently, to the extent that the Company does notuse ﬁnancial instruments to hedge its exposure resulting fromthis foreign currency mismatch, its proﬁts will be affected bymarket changes in the exchange rate of the US dollar against
these currencies. The Company has therefore implemented along-term hedging portfolio to help secure the rates at which
a portion of its future US dollar-denominated revenues (arising
primarily at Airbus) are converted into euro or pound sterling.
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 particular overthe long term, which could have a negative effect on its ﬁnancial
condition and results of operations. In addition, the portion of
the Company’s US dollar-denominated revenues that is nothedged in accordance with the Company’s hedging strategy
will be exposed to ﬂuctuations in exchange rates, which may
be signiﬁcant.
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 and Analysisof Financial Condition and Results of Operations — 2.1.2.3
Accounting for Hedged Foreign Exchange Transactions in
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.

09

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Registration Document 2017 - AIRBUS
Risk Factors
1 Financial Market Risks

Sales Financing Arrangements

In support of sales, the Company may agree to participate inthe ﬁnancing of selected customers. As a result, the Company
has a portfolio of leases and other ﬁ nancing arrangementswith airlines and other customers. The risks arising from theCompany’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, which primarily relates to unexpected
decreases in the future value of aircraft. Measures taken by
the Company to mitigate these risks include optimised ﬁnancing
and legal structures, diversiﬁcation over a number of aircraft
and customers, credit analysis of ﬁ nancing counterparties,
provisioning for the credit and asset value exposure, andtransfers of exposure to third parties. No assurances may
be given that these measures will protect the Company fromdefaults by its customers or signiﬁcant decreases in the valueof the ﬁnanced aircraft in the resale market.
The Company’s sales ﬁ nancing 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 aﬁnancing customer default at a time when the market value for aused aircraft has unexpectedly decreased, the Company would
be exposed to the difference between the outstanding loan
amount and the market value of the aircraft, net of ancillary costs(such as maintenance and remarketing costs, etc.). Similarly, if
an unexpected decrease in the market value of a given aircraft

coincided with the exercise window date of an asset value
guarantee with respect to that aircraft, the Company would be
exposed to losing as much as the difference between the market
value of such aircraft and the guaranteed amount, though suchamounts are usually capped. The Company regularly reviews
its exposure to asset values and adapts its provisioning policyin accordance with market ﬁndings and its own experience.
However, no assurance can be given that the provisions taken by
the Company will be sufﬁcient to cover these potential shortfalls.
Through the Airbus Asset Management department or as aresult of past ﬁnancing transactions, the Company is the ownerof used aircraft, exposing it directly to ﬂuctuations in the market
value of these used aircraft.
Due to the suspension of Export Credit Agency ﬁ nancing,
there is a risk that additional customer ﬁnancing will need to
be provided, which could increase the customer ﬁ nancing
exposure. See “— Legal Risks” and “— Information on Airbus
Activities — Section 1.1.7 Legal and Arbitration Proceedings”.
In addition, the Company has outstanding backstop
commitments to provide ﬁnancing related to orders on Airbus’
and ATR’s backlog. While past experience suggests it is unlikelythat all such proposed ﬁnancing actually will be implemented,
the Company’s sales ﬁnancing exposure could rise in line with
future sales growth depending on the agreement reachedwith customers. Despite the measures taken by the Company
to mitigate the risks arising from sales ﬁnancing activities as
discussed above, the Company remains exposed to the risk ofdefaults by its customers or signiﬁcant decreases in the valueof the ﬁnanced aircraft in the resale market, which may havea negative effect on its future ﬁnancial condition and results ofoperations.

Counterparty Credit

In addition to the credit risk relating to sales ﬁ nancing 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 and cash investments.
However, Airbus has policies in place to avoid concentrationsof credit risk and to ensure 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. The Company also seeks to maintain a certain levelof diversiﬁcation 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.

REGISTRATION DOCUMENT 2017
Risk Factors
1 Financial Market 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 ﬁ nancial
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 the capital
structure and cost of such banks’ activities in relation to over-thecounter derivatives, and therefore on the funding consequencesof central clearing and collateralisation of over-the-counter
derivatives for corporations like the Company. This may ultimately
increase the cost and reduce the liquidity of the Company’s longterm 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. For information related to these plans,
please refer to the “Notes to the IFRS Consolidated Financial
Statements — Note 29.1: Post-employment Benefits —Provisions for Retirement Plans”. Although the Company hasrecorded a provision in its balance sheet for its share of theunderfunding based on current estimates, there can be noassurance that these estimates will not be revised upward in
the future, leading the Company to record additional provisions
in respect of such plans.

Necessary adjustments of such provisions include but are notlimited to (i) the discount factor (dependent in part on interest rates)
and the inﬂation rate applied to calculate the net present value ofthe pension liabilities, (ii) the performance of the asset classes
which are represented in the pension assets, and (iii) additional
cash injections contributed by the Company from time to timeto the pension assets. The Company has taken measures toreduce 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 a negative effect on
the Company’s total equity (net of deferred taxes), which couldin turn have a negative effect on its future ﬁnancial condition.

Tax Exposure

As a multinational group with operations and sales in various
jurisdictions, Airbus is subject to a number of different tax
laws. It is the Company’s objective to adhere to the relevant
tax regulations and to ensure tax compliance in each country.
Airbus’ policy is to have its economic results taxed in a compliant
manner in all countries where it creates value.
The Company’s decisions on its structure and on the transactions
it enters into are based on its own fair interpretations of applicable
tax laws and regulations. The Company aims for certainty on
the tax positions it adopts, though in a complex environment
with increasing uncertainty, there can be no assurance that the
tax authorities will not seek to challenge such interpretations,consequently the Company or its afﬁliates could become subject
to tax claims.

The Company will always act to minimise the risk associatedwith a tax position, while aiming for tax efﬁciency as described
below. Where tax law is unclear or subject to interpretation,
the Company may decide to take a written opinion from an
independent third-party tax advisor, detailing the facts, risks andconclusions, so as to support the decision-making process, or to
engage with tax authorities to secure alignment on interpretationof tax rules. The level of risk will be deemed to be acceptable
where strong technical arguments exist to support the position
and where stakeholders have been consulted appropriately
according to the value at stake.
In case weaknesses may be identiﬁed in tax processes, theCompany will act to remediate the issues in a timely manner toensure continued compliance.

11

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Registration Document 2017 - AIRBUS
Risk Factors
2 Business-Related Risks

2. Business-Related Risks
Commercial Aircraft Market Factors

Historically, order intake for commercial aircraft has shown
cyclical trends, due in part to changes in passenger demand
for air travel and the air cargo share of freight activity, which arein turn driven by a range of economic variables, such as grossdomestic product (“GDP”) growth, private consumption levels
or working age population size. Other factors, however, play animportant role in determining the market for commercial aircraft,such as (i) the average age and technical obsolescence of theﬂeet relative to new aircraft, (ii) the number and characteristics
of aircraft taken out of service and parked pending potential
return into service, (iii) passenger and freight load factors,(iv) airline pricing policies and resultant yields, (v) airline
ﬁ nancial health and the availability of outside ﬁ nancing foraircraft purchases, (vi) evolution of fuel price, (vii) regulatoryenvironment, (viii) environmental constraints imposed uponaircraft operations and (ix) market evolutionary factors such as
the growth of low-cost passenger airline business models or
the impact of e-commerce on air cargo volumes. The market forcommercial aircraft could continue to be cyclical, and downturns
in broad economic trends may have a negative effect on its
ﬁnancial condition and results of operations.
The commercial helicopter market could also be inﬂuenced by anumber of factors listed above. The civil & parapublic and oil &gas market softness has led to a postponement of investmentsin the acquisition of new platforms by offshore helicopter players
and a reduction of ﬂight hours. Structural changes of the oil &gas segment are not anticipated at current oil price levels. The
uncertainty on the lead time of the market recovery may havean impact on Airbus Helicopters ﬁnancial results and could leadto cancellations or loss of bookings and services.

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, natural disasters,
damaging weather, and other crises. Any resulting impact on the
Company’s production, services or information systems could
have a signiﬁcant adverse effect on the Company’s operations,ﬁnancial condition and results of operations as well as on its
reputation and on its products 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.

REGISTRATION DOCUMENT 2017
Risk Factors
2 Business-Related Risks

All of the above mentioned risks are heightened in the context
of greater use of cloud services, integration with the extended
enterprise, the relatively insecure “internet of things” and thegrowing use in the Company’s IT systems of sophisticated mobile
devices. Social engineering is a growing threat, exacerbated byadvances 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.

Dependence on Key Suppliers and Subcontractors

The Company is dependent on numerous key suppliers andsubcontractors to provide it with the raw materials, parts,
assemblies and systems that it needs to manufacture its
products.
The Company relies upon the good performance of its suppliers
and subcontractors to meet the obligations deﬁned under theircontracts. Supplier performance is continually monitored andassessed so that supplier development programmes can belaunched if performance standards fall below expectations.
In case of supplier non-performance a systematic review andapplication of contractual liabilities linked to contract execution
allows the Company to mitigate its ﬁnancial exposure due tothe supplier non-performance. The Company also implements
performance improvement agreements with suppliers toincentivise suppliers to sustainably restore contractual
performance levels.
In addition, the Company beneﬁts from its inherent ﬂexibility
in production lead times to compensate for a limited nonper formance of suppliers, protecting the Company’scommitments towards its customers. In certain cases, dual
sourcing is utilised to mitigate the risk. However, no absoluteassurance can be given that these measures will fully protect
the Company from non-performance of a supplier which could
disrupt production and in turn may have a negative effect on its
ﬁnancial condition and results of operations.
Changes to the Company’s production or development
schedules may impact suppliers so that they initiate claims
under their respective contracts for ﬁnancial compensation.
However the robust, long-term nature of the contracts and astructured process to manage such claims, limits the Company’s

exposure. Despite these mitigation measures, this could still
result in a negative impact on the ﬁnancial condition and resultsof 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 countries that are exposed to socio-politicalunrest or natural disasters which could interrupt deliveries.
Country-based risk assessment is applied by the Company
to monitor such exposures and to ensure that appropriate
mitigation plans or fall-back solutions are available for deliveries
from zones considered to be at risk. Despite these measures,
the Company remains exposed to interrupted deliveries fromsuppliers impacted by such events, which could have a negative
effect on the ﬁnancial condition and results of operations of
the Company.
Suppliers (or their sub-tier suppliers) may also experiencefinancial difficulties requiring them to file for bankruptcy
protection, which could disrupt the supply of materials andparts to the Company. However, ﬁnancial health of suppliers
is analysed prior to selection to minimise such exposureand then monitored during the contract period to enable theCompany to take action to avoid such situations. In exceptional
circumstances, the Company may be required to provide
ﬁnancial support to a supplier and therefore face limited credit
risk exposure. If insolvency of a supplier does occur, theCompany works closely with the appointed administrators tosafeguard contractual deliveries from the supplier. Despite thesemitigation measures, the bankruptcy of a key supplier could still
have a negative effect on the ﬁnancial condition and results ofoperations of the Company.

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Industrial Ramp-Up

As a result of the large number of new orders for aircraft
recorded in recent years, the Company is in the process ofaccelerating 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 resource
or 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 lengthof delay in meeting delivery commitments, could lead to
additional costs and customers’ rescheduling or terminating
their orders. The associated risks may increase as the Company
and its competitors announce further production rate increases.
Signiﬁcant efforts have been made to improve supply chain
stability and performance. Speciﬁc areas of risk with suppliersof engines and of cabin equipment continue to be carefully
managed.

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
under demanding operating conditions. Throughout the lifecycleof our products, Airbus performs checks and inspections, which
may result in modiﬁcations, retroﬁts or other corrective actions
each of which may have an adverse effect on production,
operations, in-service performance or ﬁnancial condition. Even
though the Company believes it employs sophisticated design,
manufacturing and testing practices, there can be no assurance
that the Company’s products or services will be successfully
developed, manufactured or operated or that they will perform
as intended.
Certain of Airbus’ contracts require it to forfeit part of its
expected proﬁ t, 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 ontime 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 2015, 2016
and 2017”. 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.
Any signiﬁcant problems with the development, manufacturing,
operation or performance of the Company’s products andservices could have a signiﬁcant adverse effect on the Company’s
ﬁnancial condition and results of operations as well as on the
reputation of the Company and its products and services.

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.

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Availability of Government and Other Sources of Financing

Since 1992, the EU and the US have operated under anagreement that sets the terms and conditions of ﬁnancial support
that governments may provide to civil aircraft manufacturers.
In late 2004, however, the US sought to unilaterally withdraw
from this agreement, which eventually led to the US and theEU making formal claims against each other before the World
Trade Organization (“WTO”). While both sides have expresseda preference for a negotiated settlement that provides for alevel playing ﬁeld when funding future aircraft developments,
they have thus far failed to reach agreement on key issues.
The terms and conditions of any new agreement, or the ﬁnal
outcome of the formal WTO proceedings, may limit accessby the Company to risk-sharing-funds for large projects, may
establish an unfavourable balance of access to government
funds by the Company as compared to its US competitors or
may in an extreme scenario cause the European Commission
and the involved governments to analyse possibilities for achange in the commercial terms of funds already advanced
to the Company.

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.

Competition and Market Access

The markets in which the Company operates are highly
competitive. In some areas, competitors may have more
extensive or more specialised engineering, manufacturing andmarketing capabilities or better access to funding than the
Company. 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 theirown products or services and competing directly with theCompany for sales of these products or services, all of which
could signiﬁcantly reduce the Company’s revenues. Further, newplayers are operating or seeking to operate in the Company’s
existing markets which may impact the structure and proﬁtabilityof these markets. In addition, enterprises with different businessmodels could substitute some of the Company’s products andservices. There can be no assurance that the Company will
be able to compete successfully against its current or futurecompetitors or that the competitive pressures it faces in all
business areas will not result in reduced revenues, market shareor 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 principal
operating business segments is characterised by extensive
research and development costs requiring signiﬁcant up-front
investments with a high level of complexity. The business plans
underlying such investments often contemplate a long payback
period before these investments are recouped, and assume acertain level of return over the course of this period in order tojustify the initial investment. There can be no assurances thatthe 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. There can

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be no assurances that the Company will attract and retain the
personnel it requires to conduct its operations successfully.
Failure to attract and retain such personnel or an increase in
the Company’s employee turnover rate could negatively affect
the Company’s ﬁnancial condition and results of operations.

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.

Digital Transformation, Continuous Improvement and Competitiveness Programmes

In order to improve current operational performance while
preparing for the future, in 2017 the Company launched theintegration of its headquarters and corporate functions with thelargest Division, Airbus Commercial Aircraft, and has initiateda wide-reaching digital transformation programme, Quantum.
In parallel, continuous improvement and competitivenessprogrammes running in all businesses are pursued.

Digital Transformation
The Quantum transformation programme was launched toaccelerate transformation of end to end operations and todeﬁne our future set-up (operations, new services, new businessmodel) driven by customer requirements. In the short to midterm Quantum will focus on accelerating and industrialising themost promising digitally-enabled performance improvement
initiatives permitting a step change. In the longer term, Quantum
will redesign end to end digital operations and enable new
proﬁ table business model and services for our customers.
Quantum is supported by the Digital Transformation Ofﬁ ce(DTO) and CTO organisations.

Traditional Cost-Saving and Competitiveness
Programmes
To improve competitiveness in soft markets, offset costs andachieve proﬁtability targets, among other things, the Company
and its Divisions have launched several restructuring, costsaving and competitiveness programmes over the past several
years. These include Boost Competitiveness in Commercial
Aircraft, Adapt in Helicopters and Compete in Defence andSpace.
In addition to the risk of not achieving the anticipated level ofcost savings, efﬁciency gains and other beneﬁts from these
programmes, the Company may also incur higher than expected
implementation costs. In many instances, there may be internal
resistance to the various organisational restructuring and cost
reduction measures contemplated. Restructuring, closures, sitedivestitures and job reductions may also harm the Company’s
labour relations and public relations, and have led and could
lead to work stoppages and/or demonstrations. In the eventthat these work stoppages and/or demonstrations become
prolonged, or the costs of implementing the programmes above
are otherwise higher than anticipated, the Company’s ﬁnancial
condition and results of operations may be negatively affected.

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 be
difﬁcult 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, despite theefforts and expenditures of the parties, regulatory, administrativeor other contractual conditions can prevent transactions
from being ﬁnalised. While the Company believes that it has
committed sufﬁcient resources and established appropriate
and adequate procedures and processes necessary to mitigate
these risks, there is no assurance that these transactions will
be successfully completed or produce the expected beneﬁts.

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Risk Factors
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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 ﬁ nance 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 ﬁ nancing 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; and■provisions 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 (while thislist does not purport to be exhaustive, it highlights the current
risks believed to be material by management and that could
have a signiﬁcant impact on the Company’s ﬁnancial condition
and results of operations):

regard to capabilities and availability of the aircraft. For more
information on the DOI, see “— Management’s Discussion
and Analysis of Financial Condition and Results of Operations— Signiﬁcant Programme Developments, Restructuring andRelated Financial Consequences in 2015, 2016 and 2017
— 2.1.1.3”.

A320neo programme. In connection with the A320neo
programme, the Company faces the following main challenges:
the transition from A320ceo (current engine option) to A320neo(new engine option) that began in 2016 continued with 181
deliveries in 2017; management of the internal and external
supply chain pressure as a result of the industrial ramp-up;
ensuring maturity and high quality service support for a growing
number of operators of A320neo. The main focus will be withthe further ramp-up for Airbus 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
Airbus and customer expectations and mitigate the associatedconsequences.

Challenges remain on development of contractual technicalcapabilities and the associated costs, on securing sufﬁcient
export orders in time, and on cost reductions. The key
capabilities to be achieved remain cargo management and aerialdelivery, self-defence and protection, and air to air refuelling. In
addition, the A400M programme continues to face challenges
in the management of the retroﬁt campaign as well as providing
support to enable high levels of in-service availability.

A400M programme. In 2017, Airbus continued with development
activities toward achieving the technical capabilities. In addition,
Airbus entered into discussions with OCCAR and the customer
Nations that resulted in the signature of a Declaration of Intent(“DOI”) on 5 February 2018 agreeing on a global re-baseliningof the contract, including a revised aircraft delivery schedule,
an updated technical capability roadmap and a revised retroﬁt
schedule. The DOI represents an important step towards
reaching a contractually binding agreement also mitigating thecommercial exposure while satisfying customer needs withFor further information, please refer to the “— Notes to the IFRS
Consolidated Financial Statements — Note 10: Revenues andGross 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 totheir operations; maintaining supply chain performance andproduction ramp-up; controlling and reducing the level ofoutstanding work in ﬁnal assembly line; managing 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 to ensure entry inservice; maintaining attention on engine development; andcustomer support for new type in service.

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A380 programme. In connection with the A380 programme,
the Company faces the following main challenges: secure
future order flow; ramp down the yearly production rate
towards deliveries in 2019 and further reduce fixed costs
to the new delivery level; make continued improvements tolower the resources and costs associated with designing eachcustomised Head of Version aircraft for customers; and manage
maturity in service.

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 Company is working on thecertiﬁcation of the Public Services variant and the delivery of
the 3 ﬁrst H175 in Public Services conﬁguration planned for
2018, as well as on the maturity plan of the aircraft and withthe associated industrial ramp-up.

A330 programme. In connection with the A330 programme,
the main challenge the Company faces is to manage thetransition to A330neo. The A330neo development progresses
after ﬁrst ﬂight took place in 2017 with attention on the engine
development.

NH90 and Tiger programmes. In connection with the NH90
and Tiger programmes, the Company is delivering according tocontracts whilst negotiations for the end of some contracts andsome new contract amendments are still ongoing. In connection
with multiple ﬂeets entering into service it faces the challengeof assuring support readiness.

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; providing
assistance to the investigation team and the authorities aheadof the publication of the ﬁnal accident report; working with therelevant stakeholders to allow the return to service of aircraft,following-up with retroﬁts and dealing with customer claims.

Border security. In connection with border security projects,
the Company faces the following main challenges: meeting theschedule and cost objectives taking into account the complexityof the local infrastructures to be delivered and the integration ofcommercial-off-the-shelf products (radars, cameras and othersensors) interfaced into complex system networks; assuring
efﬁcient project and stafﬁng; managing the rollout including
subcontractors and customers. Negotiations on change
requests and schedule re-alignments remain ongoing.

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; and■three principal joint ventures: MBDA, ATR and ArianeGroup.
The formation of partnerships and alliances with other market
players is an integral strategy of the Company, and the proportionof sales generated from consortia, joint ventures and equity
holdings may rise in future years. This strategy may fromtime 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.
In addition, in those holdings in which the Company is a minority
partner or shareholder, the Company’s access to the entity’sbooks and records, and as a consequence, the Company’s
knowledge of the entity’s operations and results, is generally
limited as compared to entities in which the Company is amajority holder or is involved in the day-to-day management.

REGISTRATION DOCUMENT 2017
Risk Factors
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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.

Intellectual Property

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 intellectual property (IP) rights in its products
and services and in its operations. Despite these efforts toprotect its IP rights, any of 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 to the same extent as the laws in Europe andthe US. Therefore, in certain jurisdictions the Company may beunable to protect its proprietary technology adequately against
unauthorised third-party copying or use, which could adversely
affect its competitive position.

In addition, although the Company believes that it lawfullycomplies with the monopolies inherent in the IP rights granted
to others, it 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
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.

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
have a signiﬁcant adverse effect on the Company’s businessﬁnancial condition and results of operations.

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.

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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 Airbus, relating to irregularities concerning third
party consultants. Airbus was subsequently informed that the

French authorities, the Parquet National Financier (“PNF”), hadalso opened a preliminary investigation into the same subject
and that the two authorities will act in coordination going
forward. See “— Information on Airbus Activities — 1.1.7 Legaland 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. In addition
to the temporary suspension of export credit ﬁnancing, theCompany 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 to modify its business practices and complianceprogramme and/or have a compliance monitor imposed on
it. Any one or more of the foregoing could have a signiﬁcant
adverse effect on the Company’s reputation and its business,ﬁnancial condition and results of operations.

Legal and Regulatory Proceedings

The Company is currently engaged in a number of active legal
and regulatory proceedings. See “— Information on Airbus
Activities — 1.1.7 Legal and Arbitration Proceedings”. The
Company expects to continue to incur time and expenses
associated with its defence, regardless of the outcome, andthis may divert the efforts and attention of management fromnormal business operations. Although the Company is unable topredict 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,ﬁnancial condition and results of operations. An unfavourable
ruling could also negatively impact the Company’s stock priceand reputation.

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, ﬁnancial
condition and results of operations. See “— Non-Financial
Information — 1.1.8.4(a) Responsible Business — EthicalBusiness Practices”.

REGISTRATION DOCUMENT 2017
Risk Factors
4 Industrial and Environmental Risks

4. Industrial and Environmental 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. This expenditure
includes the identiﬁcation and the prevention, elimination orcontrol of physical and psychological risks to people arisingfrom work, including chemical, mechanical and physical agents.
Environmental protection includes costs to prevent, control,
eliminate or reduce emissions to the environment, waste
management, the content of the Company’s products, andreporting and warning obligations. Moreover, new laws andregulations, the imposition of tougher licence requirements,
increasingly strict enforcement or new interpretations of existinglaws and regulations 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. Seizures ofdefective products may be pronounced, and the Company may
incur administrative, civil or criminal liability. Any problems inthis respect may also have a signiﬁcant adverse effect on the
reputation of the Company and its products and services.
Despite compliance with all applicable laws and regulations,the Company’s reputation may also be affected by the public
perception of the contributions of its operations and activities
on society.

21

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Registration Document 2017 - AIRBUS

Chapter

1

REGISTRATION DOCUMENT 201723

1
Information on
Airbus Activities

1.1 Presentation of the Company

24

1.1.1
1.1.2
1.1.3
1.1.4
1.1.5
1.1.6
1.1.7
1.1.8

24
28
37
40
47
47
47
50

Overview
Commercial Aircraft
Helicopters
Defence and Space
Investments
Insurance
Legal and Arbitration Proceedings
Non-Financial Information

1.2 Recent Developments

72

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Registration Document 2017 - AIRBUS
Information on Airbus 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 andthe 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 € 66.8 billion in 2017, Airbus
is a global leader in aeronautics, space and related services.
Airbus offers the most comprehensive range of passenger
airliners from 100 to more than 600 seats. Airbus is also a
European leader providing tanker, combat, transport andmission aircraft, as well as one of the world’s leading spacecompanies. In helicopters, Airbus provides the most efﬁcient civil
and military rotorcraft solutions worldwide. In 2017, it generated
85% of its total revenues in the civil sector (compared to 83%
in 2016) and 15% in the defence sector (compared to 17% in2016). As of 31 December 2017, Airbus’ active headcount was
129,442 employees.

Strategy
In 2017, the Company has further pushed forward its
restructuring, in accordance with the strategy introduced in2013 and summed up in the statement “we make it fly”.
The Company has been further integrated by merging its Groupstructure with the commercial aircraft activities of Airbus. The
merger of Airbus Group and Airbus paves the way for an overhaulof the corporate set-up, simpliﬁes the Company’s governance,
eliminates redundancies and supports further efﬁ ciencies,
while at the same time driving further integration of the entire
Group. The Company changed its name to Airbus SE. The
two Divisions, “Defence and Space” and “Helicopters” remain
integral parts of the Company and will derive considerable
beneﬁt from the merger through more focused business supportand 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 defence electronics business.
The divestment is part of the strategic review of the Airbus
Defence and Space business portfolio.

Airbus Helicopters also reshaped its portfolio and divested its
Vector Aerospace business.
The eight strategic paths of the Company’s strategy remain
as follows:
1. Remain a leader in commercial aerospace, strengthenmarket position and profitability
The commercial aircraft business aims to be largely selfsufficient going forward, rather than attempting to rely on abalanced Group portfolio. Focus upon on-time, on-cost andon-quality deliveries is paramount given the huge backlog
execution challenge. Airbus aims to further strengthen
through focusing on digitalisation, innovation, services anda more global approach.
2. Preserve leading position in European defence, spaceand government markets by focusing on military
aircraft, missiles, space and related services
Defence can no longer be a tool to manage and hedge
against commercial cycles, but the Company seeks toremain strong and actively shape its defence, space andgovernmental business. The focus will involve (i) developing
high-performing businesses such as missiles, launchers,
combat and transport aircraft, entering into new growthareas when they are backed by government funding, and(ii) focusing on productivity improvements both throughinternal means and in the context of European optimisation
to enable efficiencies and improve Airbus’ positioning onexport markets.
In 2017, Airbus Aerial, a new drone service business, waslaunched. The new company, based in the US, leveragessome of Airbus Defence and Space key competencies(satellite imagery, data analytics, small & high-altitude UAV
and cloud computing) to analyse and distribute powerful,actionable data to customers.

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Information on Airbus Activities
1.1 Presentation of the Company

Airbus is working with its customers to define and address
the future of European air combat, in addition to future air
power more broadly.
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
Airbus innovates every day to increase its value propositions
by enhancing product performance, creating new customer
benefits, and reducing costs. Our cutting-edge technologies
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, Airbus raised its ambitions to pioneer and disrupt
the aerospace industry in areas that will shape the market
and our future and made a substantial effort in breakthroughinnovation.
4. Exploit digitalisation to enhance our current businessas well as pursue disruptive business models
Digitalisation will support Airbus’ transformation by focusing
on five main axes: (i) enabling high employee engagement,(ii) achieving 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 has initiated a wide-reaching digital transformation
programme called Quantum. Quantum is the programmethat drives Airbus’ digital transformation. Scaling up
and accelerating proven digital initiatives, to deliver
breakthroughs in end-to-end operational performanceand customer satisfaction across our business; it is also
about accelerating innovation and growth through both newservices and business models. Quantum is fundamental to
Airbus success, now and into the future.
A prime example of how Airbus 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
end-to-end solutions combining electrical Vertical Take Off
and Landing “eVTOL” vehicles, self-piloting/automation, anda digital, services driven economy with new mobility-as-aservice business models and seamless integration into othertransport systems. Starting around 2014, Airbus has madesignificant progress on technical solutions (e.g., eVTOL
vehicle demonstrators) and business aspects (disruptive
strategy, on-demand helicopter transport, policy making
support) and has become a precursor in the field. But therace for entry into service of the first fully certified transportsystem has just begun.
5. Adapt to a more global world as well as attract andretain global talents
With over 75% of our backlog and 70% of our revenues
coming from outside Europe, Airbus is, more than ever,a global company. The constant effort to globalise ourbusinesses, especially in countries with substantial growth,has paid off. This global footprint is also reflected in thediversity of our staff and skills. Locally, products mayneed to be adapted and will have to be serviced, but themain logic going forward is that the industry will retain its“global products for local markets” dynamic. Greenfieldapproaches have proven to give Airbus a controlled entry
and real citizenship, whilst partnerships and acquisitions
are complementary tools.
6. Focus services on and around the Company’s platforms
The strategy going forward is to focus on services where
Airbus can differentiate and add value for its customers
according to the motto “no one knows our products better
than we”, aiming at developing long-term customer intimacy
and bringing 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 substantiallythrough maintenance and support services thanks to thenew platforms in the still growing fleet, which will include
about 600 Eurofighters, over 150 A400M aircraft, around
500 NH90s and over 150 Tiger helicopters. In Commercial
Aircraft, the installed base is expanding rapidly, and new
innovative services (power by the hour, maintenance,
training) are being offered successfully.
7. Strengthen the value chain position
Airbus’ core capability is to master programme management
and architect / integrator capabilities in order to market,
design, develop, manufacture and service large-scale
aeronautics / space platforms and integrated systems. As
Airbus is based on a strong platform prime role, managing
the supplier base towards delivering to the final customer iskey. We aim to strengthen and optimise selected strategic
value chain areas to protect our intellectual property, manage
risks, increase profit, access services and differentiate ourofferings. Airbus’ suppliers provide a large proportion of thevalue in our products, necessitating a robust supply-chain
governance framework. This is supported by processes
and tools that foster partnership, risk mitigation and supplierperformance development.

1

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Registration Document 2017 - AIRBUS
Information on Airbus Activities
1.1 Presentation of the Company

In order to secure our value chain position and maintaina competitive advantage, Airbus re-assesses its make or
buy strategy and M&A strategy to better control its strategic
know how and capture more of the value chain. Airbus
launched Nacelle In-Sourcing for A320 UTAS nacelles
in order to build competence in Ultra-high Bypass Ratio
engine integration, where the integration itself will provide
a significant part of future performance gain.
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 aseries of production ramp-ups with associated financial
needs. On top of that, targeted investments are expected tohelp to position Airbus for the future. The financial strengthof the Company is vital for mastering these challenges, andto ensure that we have enough room for manoeuvre forfurther strategic moves. As a prerequisite, the Company
must remain attractive for investors, notably compared toits peers.

Organisation of Airbus’ Businesses
In 2017, the Company organised its businesses into the following
three operating segments: (i) Commercial Aircraft, (ii) Helicoptersand (iii) Defence and Space. However, as a continuation of anumber of integration and normalisation steps that took placein 2012, 2013 and 2015, the Company is now merging its Groupstructure with its largest division Commercial Aircraft. The merger
began mid-2017 and provided the opportunity to introduce asingle Airbus brand for the Company and all its entities, effective
since January 2017. On 12 April 2017, the Company changed its
name from Airbus Group SE to Airbus SE, following approval at
the Annual General Meeting. Therefore, the Company together
with its subsidiaries is referred to as “Airbus” and no longer the“Group”, and the segment formerly known as Airbus is referred
to as “Airbus Commercial Aircraft”. In this new set-up, Airbus
retains Airbus Defence and Space 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.

Commercial Aircraft
Airbus Commercial Aircraft is one of the world’s leading aircraft
manufacturers of passenger airliners, ranging in capacity from100 to more than 600 seats. Across all its aircraft families Airbus
Commercial Aircraft’s unique approach ensures that aircraft
share the highest commonality in airframes, on-board systems,
cockpits and handling characteristics. This signiﬁcantly reduces
operating costs for airlines.

Since it was founded in 1970 and up to the end of 2017, Airbus
Commercial Aircraft has received orders for 18,191 commercial
aircraft from 399 customers around the world. In 2017,
Airbus Commercial Aircraft delivered 718 aircraft (compared
to 688 deliveries in 2016) and received 1, 229 gross orders(compared to 949 gross orders in 2016), or 50% of the grossworldwide market share (in value terms) of aircraft with morethan 100 seats (compared to 54% in 2016). After accounting
for cancellations, net order intake for 2017 was 1,109 aircraft(compared to 731 aircraft in 2016). As of 31 December 2017,
Airbus Commercial Aircraft’s backlog of commercial orders was
7,265 aircraft (compared to 6,874 aircraft in 2016).
In 2017, Airbus Commercial Aircraft recorded total revenuesof € 50.96 billion – representing 75% of Airbus’ revenues. See“— 1.1.2 Commercial Aircraft”.

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 409 helicopters in 2017 (418 in2016) and received 335 net orders in 2017 (compared to 353 netorders in 2016). Order intake amounted to € 6.54 billion (2016:€ 6.06 billion). Civil contracts accounted for 49% of this ordervolume, with military sales representing the remaining 51%. At
the end of 2017, Airbus Helicopters order book stood at 692
helicopters (2016: 766 helicopters).
In 2017, Airbus Helicopters recorded total revenues of€ 6.45 billion, representing 9% of Airbus’ revenues. See “— 1.1.3
Helicopters”.

Defence and Space
Airbus Defence and Space is Europe’s number one defence andspace enterprise, the second largest space business worldwide
and among the top ten 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 2017, Airbus Defence and Space recorded total revenuesof € 10.8 billion, representing 16% of Airbus’ revenues. See“— 1.1.4 Defence and Space”.

REGISTRATION DOCUMENT 201727

Information on Airbus Activities
1.1 Presentation of the Company

Summary Financial and Operating Data

1

The following tables provide summary ﬁnancial and operating data for Airbus for the past three years.
CONSOLIDATED REVENUES BY DIVISION FOR THE YEARS ENDED 31 DECEMBER 2017, 2016 AND 2015(in €m)Year ended
31 December 2017

Year ended
31 December 2016

Year ended
31 December 2015

50,95849,23745,854

Airbus Commercial Aircraft
Airbus Helicopters

6,450

6,652

6,786

Airbus Defence and Space

10,804

11,85413,080Total Divisional revenues

68,212

67,74365,720

Other / HQ / Consolidation(1)(1,445)(1,162)(1,270)Total

66,767

66,58164,450(1) “Other / HQ / Consolidation” comprises the holding function of Airbus, the Airbus Bank and other activities not allocable to the reportable segments, combined together withconsolidation effects.

CONSOLIDATED REVENUES BY GEOGRAPHICAL AREA FOR THE YEARS ENDED 31 DECEMBER 2017, 2016 AND 2015
Year ended
31 December 2017
Amount in €bnYear ended
31 December 2016

In percentage(1)Amount in €bnYear ended
31 December 2015

In percentage(1)Amount in €bn

In percentage(1)Europe

17.0

25.4%

21.4

32.1%

20.1

31.1%

North America

12.6

18.9%

8.9

13.4%

10.2

15.9%

Asia / Pacific

24.8

37.2%

21.3

32.0%

18.8

29.1%

Rest of the World(2)

12.4

18.5%

15.0

22.5%

15.4

23.9%

Total

66.8

100%

66.6

100%

64.5

100%

(1) Percentage of total revenues after eliminations.
(2) Including the Middle East.

CONSOLIDATED ORDERS BOOKED FOR THE YEARS ENDED 31 DECEMBER 2017, 2016 AND 2015
Year ended
31 December 2017

Year ended
31 December 2016

Year ended
31 December 2015

Amount in €bn

In percentage(1)Amount in €bn

In percentage(1)Amount in €bn

In percentage(1)Airbus Commercial
Aircraft(3)

143.4

90.3%

114.9

84.3%

139.1

87.1%

Airbus Helicopters

6.5

4.1%

6.1

4.4%

6.2

3.9%

Orders booked(2)Airbus Defence andSpace
Total Divisional orders
Other / HQ /Consolidation

Total

8.9

5.6%

15.4

11.3%

14.4

9.0%

158.8

100%

136.4

100%

159.7

100%

(1.1)

(1.9)

(0.7)

157.7

134.5

159.0

(1) Before “Other / HQ / Consolidation”.
(2) Without options.
(3) Based on catalogue prices for commercial aircraft activities.

28

Registration Document 2017 - AIRBUS
Information on Airbus Activities
1.1 Presentation of the Company

CONSOLIDATED BACKLOG FOR THE YEARS ENDED 31 DECEMBER 2017, 2016 AND 2015(1)Year ended
31 December 2017

Year ended
31 December 2016

Year ended
31 December 2015

Amount in €bn

In percentage(2)Amount in €bn

In percentage(2)Amount in €bn

In percentage(2)Airbus Commercial
Aircraft(3)

950.4

95.1%

1,010.2

95.0%

952.4

94.6%

Airbus Helicopters

11.2

1.1%

11.3

1.1%

11.8

1.2%

Airbus Defence and
Space

37.4

3.8%

41.5

3.9%

42.9

4.2%

Total Divisional backlog

999.0

100%

1,063.0100%

1,007.1

100%

Other / HQ /Consolidation

(2.2)

(2.6)

(1.2)

996.8

1,060.4

1,005.9

Total(1) Without options.
(2) Before “Other / HQ / Consolidation”.
(3) Based on catalogue prices for commercial aircraft activities.

Relationship between Airbus SE and Airbus
In line with the previous organisational structure, Airbus SE
itself does not engage in the core aerospace, defence or spacebusiness of Airbus but coordinates related businesses, sets andcontrols objectives and approves major decisions for Airbus. As
the parent company, Airbus SE conducts activities which areessential to Airbus’ activities and which are an integral part ofthe overall management of Airbus. In particular, ﬁnance activities
pursued by Airbus SE are in support of the business activities
and strategy of Airbus. In connection therewith, Airbus SE
provides or procures the provision of services to the subsidiaries
of Airbus. 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 Boardof Directors, Executive Committee, and Chief Executive
Ofﬁcer in accordance with its corporate rules and procedures
as described below under “— Corporate Governance — 4.1
Management & Control”.
Within the framework deﬁ ned by Airbus SE, each Division,
Business Unit and subsidiary is vested with full entrepreneurial
responsibility.

1.1.2 Commercial Aircraft

Airbus Commercial Aircraft is one of the world’s leading aircraft
manufacturers of passenger airliners. Airbus Commercial
Aircraft helps to shape the future of air transportation and drive
steady growth around the world. Airbus Commercial Aircraft
seeks incremental innovative technological solutions and themost efﬁcient sourcing and manufacturing possible – so airlines
can grow and people can connect. Airbus Commercial Aircraft’s
comprehensive product line comprises successful families ofjetliners ranging in capacity from 100 to more than 600 seats:
the single-aisle A320 Family, which is civil aviation’s best-selling
product line; the A330 Family; the new-generation widebody
A350 XWB; and the ﬂagship double-deck A380. Across all its
aircraft families Airbus Commercial Aircraft’s unique approachensures that aircraft share high commonality in airframes,
on-board systems, cockpits and handling characteristics.
This signiﬁ cantly reduces operating costs for airlines. See“— 1.1.1 Overview” for an introduction to Airbus Commercial
Aircraft.

Airbus Commercial Aircraft’s 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, Dubaï and Singapore. Airbus Commercial
Aircraft also has engineering and training centres in Toulouse,
Miami, Mexico, Wichita, Hamburg, Bangalore, Beijing andSingapore, as well as an engineering centre in Russia. There
are also 15 hubs and 143 ﬁeld service stations around the world.
Airbus Commercial Aircraft also relies on industrial co-operationand partnerships with major companies and a wide network ofsuppliers around the world.

Strategy
Airbus Commercial Aircraft’s primary goal is to deliver strong
results in a sustained manner, while commanding a further
increased share of the worldwide commercial aircraft market
over the long-term and expanding its customer services offering.
To achieve these goals, Airbus Commercial Aircraft is actively:

REGISTRATION DOCUMENT 2017

29

Information on Airbus Activities
1.1 Presentation of the Company

Developing the Most Comprehensive Lineof Products in Response to Customer Needs
Airbus Commercial Aircraft continuously seeks to develop
and deliver new products to meet customers’ evolving needs,
while also improving its existing product line. The A330neo (newengine option) is one of the evolutions to the A330 Family and theA320neo (new engine option) is one of many product upgrades
to the A320 Single-Aisle Family to maintain its position as themost advanced and fuel-efﬁcient single-aisle aircraft family.
Airbus Commercial Aircraft is also currently pursuing(i) development and production on the A350 XWB programme,and (ii) research on the development of new aircraft in the shortrange, medium-range and long-haul segments.
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.

Expanding its Customer Services Offering
Airbus Commercial Aircraft seeks to remain at the forefront of
the industry by expanding its customer services offering to meetcustomers’ evolving needs. As a result, Airbus Commercial
Aircraft has developed a wide range of value-added andcustomised services which customers can select based on
their own make or buy policy and needs. This approach provides
Airbus operators with solutions to signiﬁ cantly reduce theiroperating costs, increase aircraft availability and enhance thequality of their operations.

Building a Leaner, More Fully Integrated
Company
In order to build a leaner, more fully integrated company andthereby bolster its competitiveness, Airbus Commercial Aircraft
is adapting its organisation to foster an entrepreneurial spirit
and empower more teams, while maintaining harmonised
processes across all sites. For series programmes, additional
responsibilities and means have been delegated to plants fordelivery 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 andplanning with the 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.

In recent years, China and India have emerged as signiﬁcant
new aircraft markets. According to internal estimates, they
are expected to constitute the ﬁrst and third most important
markets by aircraft delivery value, respectively, in the next twenty
years. As a result, Airbus Commercial Aircraft has sought tostrengthen its commercial and industrial ties in these countries.
New aircraft demand from airlines in the Middle East has also
become increasingly important, as they have rapidly executed
strategies to establish a global presence and to leverage thebeneﬁts the region can deliver.
The no-frills / low-cost carriers also constitute a signiﬁcantsector, 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 Commercial Aircraft’s range oftwin-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 trafﬁ c growth during the jet age, and a cyclical
downturn for airlines in terms of trafﬁc (both passenger andcargo), yields and proﬁtability.
More recently, air travel demand growth has gained solid
momentum, supported by the ongoing improvement in global
economic conditions throughout the year. World real GDP
growth is projected to be at 2.7% in 2017, an acceleration fromthe 2.4% in 2016, and is expected to further strengthen to 2.9%
in 2018. The upward trend was driven by the strengthening
investment in advanced economies as well as the recovery
in emerging market and developing economies owing to theincreased export demand. The lower air fares owing to the low
fuel price also continued to stimulate trafﬁc growth, albeit at amore moderate level compared to 2016.
Preliminary figures released at the end of 2017, by theInternational Civil Aviation Organisation (ICAO), confirmedthat some 4.1 billion passengers made use of the global airtransport network for their business, tourism needs or for
simply visiting friends and relatives (VFR) in 2017. The annual
passenger total is up 7.1% compared to 2016 and the numberof departures rose to approximately 37 million globally. World
passenger trafﬁc, expressed in terms of total scheduled revenue
passenger-kilometres (RPKs), posted an increase of 7.6%
with approximately 7.7 trillion revenue passenger kilometresperformed.

1

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Registration Document 2017 - AIRBUS
Information on Airbus Activities
1.1 Presentation of the Company

In the long-term, Airbus Commercial Aircraft believes that air
travel remains a growth business. Based on internal estimates,
Airbus Commercial Aircraft anticipates a growth rate of 4.4%
annually during the period 2017-2036. If the actual growth rateequals or exceeds this level, Airbus Commercial Aircraft expects
that passenger trafﬁ c, as measured in revenue passenger
kilometres, would more than double over the forecast period.
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 proﬁ tability,
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. In the last seven years, order totals exceeded record
Airbus Commercial Aircraft deliveries thus strengthening bothorder book and backlog totals.
Despite some cyclicality in airline demand, Airbus Commercial
Aircraft aims to secure stable delivery rates from year to year,
supported by a strong backlog of orders and a regionallydiverse customer base. At the end of 2017, the backlog stood
at 7,265 aircraft, representing around nine years of production
at current rates. Through careful backlog management, closemonitoring of the customer base and a prudent approachto production increases, Airbus Commercial Aircraft has
successfully increased annual deliveries for 15 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, as
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 insufﬁ cient, airlines havedeveloped highly efﬁ cient “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 ﬂ eet 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 inorder to implement such strategies (although the trend has
been towards larger-sized aircraft within each market segment
as discussed below).
Airbus Commercial Aircraft, 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 newroutes, which will largely be typiﬁed by having a major hub city
at least at one end of the route. These new route markets are
expected to be well served by the latest product offering, theA350 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 (suchas London, Paris, New York and Beijing). Airbus Commercial
Aircraft has identiﬁed 58 major hub cities in its current market
analysis, with this number expected to grow to over 95 by 2036.
Airbus Commercial Aircraft 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 15 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
Commercial Aircraft, nearly 19,000 passenger aircraft withmore than 100 seats were in service with airlines worldwide
at the beginning of 2017. Currently, Airbus Commercial Aircraftcompetes in each of the three principal market segments foraircraft with more than 100 seats.
“Single-aisle” aircraft, such as the A320 Family, have 100 to
more than 200 seats, typically conﬁgured with two triple seats
per row divided by one aisle, and are used principally for shortrange and medium-range routes.
“Wide-body” aircraft, such as the A330 / A350 XWB Families,
have a wider fuselage with more than 210 seats, typicallyconﬁgured with eight seats per row and with two aisles. The
A330 / A350 XWB Families are capable of serving all short- tolong-range markets.
“Very large aircraft”, such as the A380 Family, are designed tocarry more than 400 passengers, non-stop, over very long-range
routes with superior comfort standards and with signiﬁcant

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1.1 Presentation of the Company

cost-per-seat beneﬁts to airlines, although such aircraft canalso be used over shorter ranges in high-density (including
domestic) markets.
Freight aircraft, which form a fourth, related segment, are often
converted ex-passenger aircraft. See “— Regional Aircraft,
Aerostructures, Seats and Aircraft Conversion — EFW”.
Airbus Commercial Aircraft also competes in the corporate, VIP
business jet market with the ACJ.
Airbus Corporate Jets (ACJ) creates the world’s most rewarding
ﬂying experiences with customers by providing them with uniqueexpertise, the ﬁ nest service, best technology and highest
standards of care in corporate aviation.
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 these aircraft extends
Airbus’ leadership in cabin comfort to even longer ﬂights.
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 the Company’s philosophy ofcustomer care.
More than 180 Airbus corporate jets are in service withcompanies, individuals and governments, and they are ﬂying
on every continent, including Antarctica.
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, particularly in North America due to the development ofhubs following deregulation. In comparison with North America
and Europe, 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 oftwin-aisle aircraft is also reinforced by the fact that many of theregion’s major airports limit the number of ﬂights, due either toenvironmental 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 Commercial Aircraft 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-costcarriers continue to develop in the region. Aircraft economics
will also help to drive aircraft size, with airlines looking to reducethe cost per seat through higher density aircraft cabins and theuse of larger aircraft types and variants where possible.
Competition. Airbus Commercial Aircraft has been operating
in a duopoly since Lockheed’s withdrawal from the market in1986 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 Commercial Aircraft
and Boeing. According to the manufacturers’ published ﬁguresfor 2017, Airbus Commercial Aircraft and Boeing, respectively,

accounted for 48% and 52% of total commercial aircraft
deliveries, 55% and 45% of total net orders (in units), and
55% and 45% of the total year-end backlog (in units). Airbus
Commercial Aircraft’s deliveries (718 in 2017) were the 15th year
in a row of increased production.
Nevertheless, the high technology and high value nature of thebusiness makes aircraft manufacturing an attractive industry inwhich to participate, and besides Boeing, Airbus Commercial
Aircraft faces aggressive international competitors who areintent on increasing their market share. Regional jet makers
Embraer and Bombardier, coming from the less than 100-seatcommercial aircraft market, continue to develop larger airplanes(such as the new E190-E2 programme launched by Embraer).
Additionally, other competitors 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. The transaction remains
subject to regulatory approvals, as well as other conditions
usual in this type of transaction. Completion of the transaction
is currently expected for the second half of 2018.

Customers
As of 31 December 2017, Airbus Commercial Aircraft had
399 customers and a total of 18,191 Airbus aircraft had beenordered, of which 10,926 aircraft had been delivered to operators
worldwide. The table below shows Airbus Commercial Aircraft’s
largest commitments in terms of total gross ﬁ rm orders bycustomer for the year 2017.
Customer

Firm orders(1)Wizz Air Hungary

156

Delta Air Lines

145

Frontier Airlines

134

GECAS

110

Volaris80(1) Options are not included in orders booked or year-end backlog.

Products and Services
The Family Concept — Commonality acrossthe Fleet
Airbus Commercial Aircraft’s aircraft families promote ﬂ eet
commonality. This philosophy takes a central aircraft andtailors it to create derivatives to meet the needs of speciﬁcmarket segments, meaning that all new-generation aircraft
share the same cockpit design, ﬂy-by-wire controls and handlingcharacteristics. Pilots can transfer among any aircraft within
the Airbus Commercial Aircraft family with minimal additional
training. Cross-crew qualiﬁ cation across families of aircraft
provides airlines with signiﬁcant operational ﬂexibility. In addition,
the emphasis on ﬂeet commonality permits aircraft operators
to realise signiﬁcant cost savings in crew training, spare parts,

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Registration Document 2017 - AIRBUS
Information on Airbus Activities
1.1 Presentation of the Company

maintenance and aircraft scheduling. The extent of cockpit
commonality within and across families of aircraft is a uniquefeature of Airbus Commercial Aircraft that, in management’s
opinion, constitutes a sustainable competitive advantage.
In addition, technological innovation has been at the core of
Airbus’ strategy since its creation. Each product in the Airbus
Commercial Aircraft family is intended to set new standards inareas crucial to airlines’ success, such as cabin comfort, cargocapacity performance, economic performance, environmental
impact and operational commonality. Airbus Commercial Aircraft
innovations often provide distinct competitive advantages, withmany becoming standard in the aircraft industry.
A320 Family. With more than 14,000 aircraft sold, of which
5,995 A320neo (new engine option) Family, and nearly 8,000
delivered (of which 249 A320neo family), Airbus’ family of singleaisle aircraft, based on the A320, includes the A319 and A321
derivatives, as well as the corporate jets family (including newmembers ACJ319neo and ACJ320neo). Each aircraft in theA320 Family shares the same systems, cockpit, operatingprocedures 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 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 lightweight carbon ﬁbre composite horizontal stabiliser.
The use of composite material has also been extended to
the vertical stabiliser. The A320 Family’s competitor is the
Boeing 737 series.
To ensure this market leader keeps its competitive edge, Airbus
Commercial Aircraft continues to invest in improvements acrossthe product line, including development of the A320neo Family.
The A320neo incorporates many innovations including latest

generation engines, Sharklet wing-tip devices and cabin
improvements, which together will deliver up to 20% in fuelsavings by 2020. The A320neo received joint Type Certiﬁcationfrom the European Aviation Safety Agency (EASA) and theFederal 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 certiﬁ ed in May 2016. The A321neo
with Pratt & Whitney engines received Joint Type Certiﬁcationin December 2016 and with CFM engines in March 2017. Type
Certiﬁcations for the A319neo in both engine variants will 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 Commercial Aircraft customers andoperators who have taken delivery of nearly 8,000 A320 Family
aircraft so far.
With 5,995 ﬁrm orders received from 98 customers since its
launch in December 2010, the A320neo Family has captured
57% of the market to the end of 2017.
In October 2015, Airbus Commercial Aircraft announced thedecision to further increase the production rate of the Single
Aisle Family to 60 aircraft a month in mid-2019, in response tostrong customer demand and following thorough studies on
production ramp-up readiness in the supply chain and in Airbus
Commercial Aircraft’s facilities.
In 2017, Airbus Commercial Aircraft received 1,160 gross orders
for the A320 Family of aircraft (1,054 net orders), and delivered
558 aircraft (including 181 A320neo family aircraft).
The ﬁrst A321neo powered by CFM engines was delivered in
April 2017 to Virgin America and the ﬁrst A321neo powered by
P&W engines in September to ANA.

A320 FAMILY TECHNICAL FEATURES (CURRENT VERSION)
Entry-into-service

Passenger capacity(1)

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)

185

5,950

(2)

44.5

35.8(3)

140

6,950

33.8

35.8

165

6,500

37.6

35.8

206

7,400

44.5

35.8

Model

A321

1994

A319neo
A320neo
A321neo(1) Two-class layout.
(2) Range with sharklets.
(3) Wingspan with sharklets.

2016

Range (km)Length (metres)

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1.1 Presentation of the Company

A330 Family. With 1,707 aircraft sold (of which 220 A330neo)
and 1,323 delivered, the A330 Family covers all market segmentswith one twin-engine aircraft type and is designed to carry
between 247 and 277 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.
The newest evolution to the A330 Family is the A330neo (newengine option), comprising the A330-800neo and A330900neo versions. These aircraft incorporate latest generation
Rolls-Royce Trent 7000 engines. Airbus Commercial Aircraft
commenced ﬁnal assembly for the ﬁrst A330neo, an A330900, in 2016. The ﬁrst ﬂight took place in October 2017 andboth Type Certiﬁcation and ﬁrst delivery are planned for 2018.
The ﬁnal assembly of the A330-800 started in November 2017
and the aircraft is on track for the ﬁrst ﬂight planned mid-2018.
In 2017, Airbus Commercial Aircraft received 6 net orders for
the A330neo.

The platform for developing the Neo is the 242-tonne maximum
take-off weight A330 variant. This upgrade was ﬁrst applied
to the A330-300 with the ﬁ rst enhanced A330-300 variant
delivered to Delta Airlines in May 2015 and subsequently for
the A330-200.
Airbus Commercial Aircraft is also adapting the A330-300 to
rapidly growing markets, where the aviation infrastructure is
struggling to keep us with surging demand. The A330 Regional,
the lower-weight variant will carry up to 400 passengers on
shorter haul missions resulting in signiﬁ cant cost savings.
Saudi Arabian Airlines became the A330-300 Regional launchcustomer with an order announced in June 2015 and the ﬁrst
delivery in August 2016.
Airbus Commercial Aircraft is continuously developing the A330
Family to keep the aircraft at the leading edge of innovations.
In 2017, Airbus Commercial Aircraft received 25 gross orders (21net) for the A330 Family of aircraft including 10 for the A330neo,
and delivered 67 aircraft to customers.

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

11,75063.7

60.3

A330-800neo

257

13,90058.8

64A330-900neo

287

12,13063.7

64(1) Three-class configuration.

A380. The double-deck A380 is the world’s largest commercial
aircraft ﬂ ying today. Its cross-section provides ﬂ exible andinnovative cabin space, allowing passengers to beneﬁt fromwider seats, wider aisles and more ﬂoor space, tailored to theneeds of each airline. Carrying 544 passengers in a comfortablefour-class configuration and with a range of 8,200 nm /15,200 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 2017, Airbus Commercial Aircraft delivered 15 aircraft.
Following an agreement reached between Emirates Airline andRolls-Royce and a subsequent agreement between Emirates
Airline and Airbus Commercial Aircraft, Airbus is to adapt theA380 delivery stream with six aircraft deliveries shifted from2017 to 2018 and six others from 2018 to 2019.

Airbus Commercial Aircraft re-conﬁrms the target to deliveraround 12 aircraft in 2018 and 8 in 2019. Airbus Commercial
Aircraft has an industrially robust process to deliver down to
6 aircraft a year.
Airbus Commercial Aircraft is continuing to invest in the A380
and in 2017 announced the outcome of a development study:
The A380plus; Aerodynamic improvements, cabin enablers(new forward stairs / optimizing galleys and staircases / crewrest) allowing 80 additional seats, bringing the baseline offeringof the A380 to some 575 seats in 4 classes, additional range(+300 nm) or payload (+3 tonnes MTOW), system improvements
and maintenance optimisation together is expected to bring 13%
COC per seat reduction compared to today’s A380s.
Airbus Commercial Aircraft launched the iﬂyA380.com website
enabling passengers to identify if the A380 is operated on aparticular route and to book ﬂights directly with the airlines
ﬂying A380s.

A380 TECHNICAL FEATURES
Model
A380-800(1) Four-class layout.

Entry-into-service

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

Wingspan (metres)

2007

544

15,200

73.0

79.8

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Registration Document 2017 - AIRBUS
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1.1 Presentation of the Company

A350 XWB Family. The A350 XWB is an all-new family of
wide-body aircraft, designed to accommodate between
280 and 366 passengers. The A350 XWB features A380
technology, a wider fuselage than that of competing new
generation aircraft, and a greater use of composite material.
The A350 XWB’s main competitors are the Boeing 787 and
777 aircraft series.
With the Ultra-Long Range version of the A350-900 launchedin 2015, the A350 XWB demonstrates its versatility by offering
the capability to perform ﬂights of up to 19 hours.

Airbus Commercial Aircraft has developed the larger A3501000, which is now certiﬁed by EASA and the FAA and wasdelivered to its ﬁrst customer in February 2018. This follows
ﬁnal assembly line start in February 2016 and a successful ﬁrst
ﬂight in November 2016.
In 2016, Airbus Commercial Aircraft received 44 gross orders
for the A350 XWB Family (36 net), and delivered 78 aircraft.
In July 2017, Airbus Commercial Aircraft celebrated the deliveryof its 100th A350 aircraft – an A350-900 for China Airlines justsome 30 months after the ﬁrst delivery of an A350.

A350 XWB FAMILY TECHNICAL FEATURES
Entry-into-service

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

Wingspan (metres)

A350-900

2014

325

14,35066.8

64.7

A350-1000

2018

366

14,800

73.7

64.7

Model

(1) Two-class layout.

Customer Services
Customer Services’ prime role is to support its customers
in operating their Airbus ﬂ eet safely and proﬁ tably and to
the satisfaction of passengers all around the world. As aresult of its continued growth, Airbus Commercial Aircraft’s
customer base has increased consistently over the past
years reaching 9,950 aircraft in-service by the end of 2017
operated by 424 customers. The ﬂeet is maintained by morethan 100 Maintenance and Repair Organisations and partiallyowned by 100 leasing companies.
A worldwide network of more than 5,000 people cover all areasof support from technical engineering / operational assistanceand spare parts supply, to crew and maintenance training.
Hundreds of technical specialists provide Airbus Commercial
Aircraft customers with advice and assistance 24 hours a day,
7 days a week. There are 143 ﬁeld service stations available
worldwide for on-site assistance to our operators, covering
167 operators. 201 operators are covered by 15 Hubs. Ourworldwide support is also based on an international networkof support centres, training centres and spares’ warehouses.
Beyond the core customer support activities, Airbus Commercial
Aircraft has developed a comprehensive services portfolio
including a wide range of modular and customised services
driven by the unique added value that an aircraft manufacturer
can bring.
The services portfolio is clustered around four pillars:
Maintenance & Engineering Solutions consisting of Flight Hour
Services & Material Services, Training, Upgrades and Flight
Operations.
A recent major step in the development of Customer Services
is the creation of Navblue out of the Navtech acquisition in
2016. With its comprehensive product suite of solutions forelectronic ﬂight bags (EFBs), aeronautical charts, navigation
data, performance-based navigation (PBN), ﬂ ight planning,
aircraft performance and crew planning, Navblue further

strengthens Airbus Commercial Aircraft’s provision of endto-end ﬂight operations services. At the 2016 FarnboroughInternational Airshow, the launch of two new services has
been announced as well: Airline Operating Control Centre andAeronautical Data solutions.
In addition, three new training centres have been opened in
Singapore, Mexico and Sao Paulo, and the Services digitalroadmap is progressing well with the launch of new e-solutions
on Predictive Maintenance notably.
In 2017, Sepang Aircraft Engineering (SAE), an MRO centre
based in Kuala Lumpur, Malaysia, partially owned by Airbus
since 2011, has become a fully owned Airbus subsidiary,
following the acquisition by Airbus of its remaining shares. It
will boost growth strategy of services by Airbus in Asia Paciﬁc.
Airbus launched a new offer, Airbus Interiors Services, dedicatedto supporting airlines with their cabin upgrade development
strategies.
At Le Bourget airshow, Airbus launched a new aviation data
platform in collaboration with Palantir Technologies – pioneers
in big-data integration and advanced analytics. 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.

Customer Finance
Airbus Commercial Aircraft favours cash sales, and does
not envisage customer financing as an area of businessdevelopment. However, Airbus Commercial Aircraft recognises
the commercial need for manufacturers to assist customers inarranging 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 Commercial Aircraft’s
dedicated customer ﬁnance team has accumulated decades

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Information on Airbus Activities
1.1 Presentation of the Companyof expertise in aircraft ﬁnance. When Airbus Commercial Aircraft
ﬁnances a customer, the ﬁnanced aircraft generally serves as
collateral, with the engine manufacturer participating in theﬁnancing. These elements assist in reducing the risk borne by
Airbus Commercial Aircraft. The difference between the gross
exposure resulting from the ﬁnancing and the collateral value
is fully provisioned for (for further information, please refer tothe “— Notes to the IFRS Consolidated Financial Statements— Note 25: Sales Financing Transactions”). Airbus Commercial
Aircraft’s customer F inancing Transactions are designed tofacilitate subsequent sell-down of the exposure to the ﬁnancial
markets, third-party lenders or lessors.
In 2017, Airbus Commercial Aircraft continued to benefit
from market appetite for both aircraft ﬁnancing and sale andleaseback lessor opportunities, supported by a high level ofliquidity available in the market at good rates for Airbus aircraft.
Despite a continued suspension of Export Credit Agency
support, Airbus Commercial Aircraft customer financing
exposure remained limited in 2017 and decreased compared to2016. Airbus Commercial Aircraft 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 Commercial Aircraft from default costs is
adequate and consistent with standards and practice in theaircraft ﬁ nancing 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 Commercial Aircraft, originally as a result of customer
bankruptcies, and subsequently in the context of certain buyback commitments. The department operates with a dedicatedstaff and manages a ﬂeet comprised of used aircraft acrossa wide range of models. Through its activities, the AssetManagement department helps Airbus Commercial Aircraft
to respond more efﬁciently to the medium- and long-term ﬂeet
requirements of its customers.
Its key roles comprise commercial, technical and ﬁ nancial
risk management of its used aircraft portfolio, as well as theenhancement of all Airbus Commercial Aircraft 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 Commercial Aircraft
Asset Management team aims at eventually selling down
the aircraft with lease attached to further reduce its portfolio
exposure.
At the end of 2017, the Asset Management portfolio contained
27 aircraft, representing a 27% net portfolio reduction from2016.

Production
Industrial Organisation
Each task in the building of Airbus aircraft (from design toproduction) is allocated to a designated plant. The Airbus
Commercial Aircraft plants are typically organised arounddifferent aircraft components and sections, in component
delivery teams. Each component delivery team is either in chargeof one aircraft programme, or organised by manufacturing
technology clusters depending on the optimum solution for eachplant. Every plant is organised 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 incharge of ensuring that harmonised and standardised processes,
methods and tools are developed and implemented across theplants, in order to increase efﬁciency, based on best practices.
Another transversal “Manufacturing technologies” Centre ofCompetences is in charge of disseminating new technologies
and innovation in manufacturing across the plants and preparing
manufacturing solutions for future product evolutions.
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. To support the A380 production
ﬂow, Airbus Commercial Aircraft has also integrated road, riverand sea transport. 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.
Following the commencement of aircraft assembly at the A320
Family ﬁnal assembly line in Mobile, Alabama (US) in July 2015,
the ﬁrst delivery of a Mobile-assembled aircraft took place inApril 2016. At the time of publication, Airbus Commercial Aircraft
anticipates delivering four aircraft per month from the Mobile
plant. The vast majority of the aircraft produced in Mobile will
be delivered to North American customers.
In 2017, Airbus Commercial Aircraft announced the following
production rate:■
A320 family: rate 60 by mid 2019 with a 4th A320 line in
Hamburg, Mobile fully on schedule and Tianjin (China)
ramping- up further;■
A330: rate 6 in 2018;■
A380: 12 deliveries in 2018 and 8 in 2019.

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).

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Information on Airbus Activities
1.1 Presentation of the Company

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.

Regional Aircraft, Aerostructures, Seats
and Aircraft Conversion
ATR
ATR (Avions de Transport Régional) is a world leader in the
30 to 78 seat regional turboprop aircraft market. 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
Commercial Aircraft. Headquartered in Toulouse, ATR employs
more than 1,300 people. Since the start of the programme
in 1981, ATR has registered net orders for 1,671 aircraft(465 ATR 42s and 1,206 ATR 72s).
In 2017, ATR delivered 78 new aircraft (compared to 80 in 2016)
and recorded net ﬁrm orders for 103 new aircraft (compared
to 32 in 2016), including signiﬁcant orders from Indigo and IranAir, and an order from Fedex for the new ATR-72 F (freighter).
As of 31 December 2017, ATR had a backlog of 235 aircraft(compared to 212 in 2016).

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
Commercial Aircraft, the ATR range is based on the family
concept, which provides for savings in training, maintenance
operations, spare parts supply and cross-crew qualiﬁcation. By
the end of 2017, ATR had delivered 1,436 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
and Johannesburg. ATR worldwide presence also includes arepresentative ofﬁce in Beijing.
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 Commercial Aircraft, such as
wing design and manufacturing, ﬂight-testing and information
technology.

STELIA Aerospace
STELIA Aerospace is a wholly-owned subsidiary of Airbus.
Following the merger of Sogerma and Aerolia in 2015, it now
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 programs.
From full aircraft wings and fuselage sections, to fully equipped“plug and ﬂy” structures, STELIA Aerospace is a global partner
for major aeronautical players worldwide, such as Airbus, ATR,
Bombardier or Boeing.
With more than 6,900 employees worldwide, working within
11 Centres of Excellence based in France, Canada, Morocco
and Tunisia, STELIA Aerospace has the capability to offer both
Build-to-Print and Design & Build solutions.
Other specialisms include mechanical milling of rolled andstretched panels, and tubes & pipes covering all ATA systems.
STELIA Aerospace also designs and manufactures luxury FirstClass 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 kinds of aircraft, andoffers support from design to production, including after-sales
service.
As part of its development strategy, STELIA Aerospace isactively seeking new commercial and strategic opportunities.

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Premium AEROTEC
Premium AEROTEC is a wholly owned subsidiary of theCompany (consolidated within Airbus Commercial Aircraft), is
one of the world’s leading tier-1 suppliers of commercial andmilitary 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. The Company isalso striving to expand its maintenance, repair and spare parts
business.
In order to contribute successfully to the shaping of the future ofaviation, the engineers and developers at Premium AEROTEC
are continuously working on the new and further developmentof lightweight and highly durable aircraft structures. They

cooperate closely with universities and research institutes in
the process. Premium AEROTEC plays a signiﬁcant role in thedesign of new concepts in such ﬁelds as carbon composite
technologies (incl. thermoplastic processes) or 3D-printing ofaircraft components made of titanium or aluminum.

Elbe Flugzeugwerke GmbH — EFW
EFW combines various aviation and technology activities undera single roof: development and manufacturing of ﬂ at ﬁ brereinforced composite components for structures and interiors,
the conversion of passenger aircraft into freighter conﬁguration,
maintenance and repair of Airbus Commercial Aircraft aircraft
as well as engineering services in the context of certiﬁcation
and approval.
On 17 June 2015, Airbus Commercial Aircraft signed anagreement with Singapore-based ST Aerospace Ltd. (STA) tooffer passenger-to-freighter (P2F) conversion solutions for its
A320 and A321 aircraft. STA acquired an additional 20% of theshares of EFW, Dresden (Germany) by way of a contribution
in kind and a capital increase to EFW. The transaction closed
on 4 January 2016. Consequently, 45% of the shares of EFW
were retained and Airbus effectively lost its control over EFW(previously reported in Airbus Commercial Aircraft).

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.
Flight-test activities were carried out throughout 2017. The
third H160 prototype has been introduced in early Octoberenabling ﬂight tests to accelerate with the ﬁnal assembly line
in Marignane being in the ﬁnal stages of preparation. In 2017,
products and services continued to be enhanced, with several
initiatives such as the ongoing development of the H175 PublicServices version for delivery in 2018 and the ﬁrst ﬁre campaignof the H145 equipped with H-Force suite for German Special
Operation Forces.

Airbus Helicopters is investigating future unmanned VTOL
(Vertical Take-off and Landing) systems. In that frame,
Airbus Helicopters is currently working on the design anddevelopment of the VSR700 unmanned aerial vehicle. The
French DGA (Direction Générale de l’Armement) has awarded acontract to the Naval Group and Airbus Helicopters consortium
to identify, deploy and test the necessary technologies forthe integration of a tactical drone-system capacity within aheavily armed vessel.
Airbus Helicopters is also exploring Urban Air Mobility (UAM)
via theCityAirbus 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
conﬁ guration of the high speed demonstrator codenamed
Racer. This demonstrator will incorporate a host of innovative
features and will be optimised for a cruise speed of more than
400 km/h. Beyond the platform Airbus Helicopters wants toplay a leading role in UAM services like on-demand helicopter
booking platforms. Voom, now operational in Sao Paulo, willbe the entity that will provide this new service to be deployed
to other locations notably in the Americas and Asia-Paciﬁc.

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Focusing on Customers
Airbus Helicopters achieved the ﬁrst wave of its transformation
plan in 2017 by further enhancing customer support andservices, with safety as the top priority. This is underscoredby indicators like increasing ﬂeet availability for customers andoperators, or improved On Time Delivery rates for spare parts.

Delivering Safety
An H225 Super Puma helicopter was involved in an accident
on 29 April 2016. Management is cooperating fully with theauthorities to determine the precise cause of the accident.
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.
Airbus Helicopters’ chief priority is to enhance ﬂ ight safety
for the thousands of men and women around the world who
are transported in its aircraft every day. This commitment is
reﬂected 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.

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 (allturbine helicopters). This forecast, particularly with respect to themilitary sector, relies to a large extent on large US development
programmes. Overall, the global helicopter market is still
evolving in a difﬁcult environment, despite improved economic
indicators in 2017.
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 (especially in Asia
still largely under equipped). Airbus Helicopters’ market data
indicates that in 2017, worldwide deliveries of civil and parapublic
turbine helicopters over ﬁve seats stood at ~520 units. Demand
for military helicopters and related services is mainly driven bybudgetary and strategic considerations, and the need to replaceageing ﬂeets. Airbus Helicopters believes that the advanced
age of current ﬂ eets, the emergence of a new generationof helicopters equipped with integrated systems and theongoing 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 2017. 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 stood at ~700 units in 2017.

Competition
Airbus Helicopters’ primary competitors in the civil andparapublic sector are Leonardo and Bell Helicopter. Sikorsky
and Russian Helicopters (except in Russia) continue to reﬂect
very 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 consolidated its market share (in bookings of
2.0t helicopters and ﬁ ve seats and above), in a low market,
with 50% in unit in 2017, followed by Bell and Leonardo withrespectively 18% and 17%.
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 Super Puma family contracts, Airbus
Helicopters increased its market share on this sector (in value)
from 4% in 2016 to 12% in 2017. Airbus will continue to focus
on large military campaigns in 2018.

Customers
More than 3,000 operators currently ﬂ y 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 50% of the worldwide market share-based on deliveries,
the versatility and reliability of Airbus Helicopters products havemade them the preferred choice of the most prominent civil
and parapublic customers (turbine helicopters over ﬁve seats).

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Products and Services
Airbus Helicopters offers a complete range of helicopters that covers nearly the entire civil and military market spectrum, which it
continuously improves with leading-edge technologies. This product range includes light 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)VIP, Military Utility(2), Emergency Medical, Public Services(1)H145 / LUH (UH-72) / H145M
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)H175

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

Medium-Heavy
Civil Utility, Military Transport / SAR, Oil & Gas

H215 “Super Puma” / H215M“Cougar”
H225 / H225M

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.

Airbus Helicopters conﬁrms serial production of the H120 has
ended in September 2017. The decision to stop production of
the H120 is the result of Airbus Helicopters’ strategy to focus
on markets where high-end technologies bring most value tocustomers.

Military Range

Civil Range

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 40 NH90 deliveries in 2017, for a cumulative totalof 345 deliveries as of the end of 2017. The NH90 ﬂeet has
accumulated ~145,000 ﬂight hours.

Airbus Helicopters’ civil range includes light 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 pursuing a fast-paced productrange renewal. This entails development for the next generationof helicopters with the H175 Public Services variant and theH145 H-Force.
In the civil market, Airbus Helicopters is preparing the future – the
H Generation – embodied by the all-new, medium-weight H160
civil helicopter which was unveiled and started ﬂight testing.

Airbus Helicopters’ military range comprises platforms derived
from its commercial range (such as the H225M derived from theH225) as well as purely military platforms developed for armed
forces (the NH90 and the Tiger).

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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 2017, 17 Tigers were delivered, for a
cumulative total of 171 deliveries by year-end. The Tiger ﬂeet
has accumulated more than 96,000 ﬂight hours.
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 2018, 430 aircraft had been delivered to the
US Defense Department for operation by US Army and Army
National Guard units, the Navy and foreign military sales
buyers.

Customer Services
With more than 3,000 operators in over 150 countries, Airbus
Helicopters has a large fleet of some 12,000 in-service
rotorcraft to support. As a result, customer service activities
to support this large ﬂeet generated 44% of Airbus Helicopters’revenues for 2017 after the disposal of Vector Aerospace inNovember 2017.

Airbus Helicopters’ customer service activities consist primarilyof maintenance, repairs, spare parts supply, training andtechnical support. In order to provide efﬁ cient 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.
In Australia, Australian Aerospace assembles, upgrades andmaintains NH90 and Tiger for the country’s armed forces;
while a rotary-wing centre of excellence in Helibras — Itajuba,
Brazil produces, assembles and maintains H225M helicopters
acquired by the Brazilian armed forces.

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 Programme Lines:
Military Aircraft; Space Systems; Communications, Intelligence& Security (CIS); and Unmanned Aerial Systems (UAS), 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. It also manufactures orbitaland space exploration systems. Space transportation
capabilities (comprising launchers and services) are offered
via ArianeGroup, a 50/50 joint venture between Airbus andSafran;Communications, Intelligence & Security (CIS) includes fourbusiness clusters: Secure Communications, Intelligence,
Cyber Security and Security Solutions. These clusters develop
speciﬁc solutions for customers ranging from governments tosmall companies and commercial enterprises. In addition, CIS
houses a dedicated unit for developing future applications forcommercial 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.
■

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, Airbus Defence and Space is currently
implementing a growth strategy based on strengthening its
core product portfolio and expanding the services business,with a major emphasis on digitalisation (“Smarter Products –More Services – More Digital”).

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This growth strategy includes the following objectives:■
shape the next generation of integrated combat systems
and services: As a replacement for the current generation ofEuropean combat aircraft, our vision for Future Air Power isbased on a secure, interconnected, scalable and upgradable
system of manned and unmanned platforms, including a new
ﬁghter and enhanced sensors and effectors;■
lead the market in multi-mission and military transport
solutions: We will develop further upgrades and capabilities
for our A330 MRTT and C295 platforms including greater
connectivity and automatisation. We will progress our
products towards multi-mission capability and will enlarge
our portfolio;■build an innovative UAS portfolio for commercial andmilitary applications: In the area of commercial UAS, Airbus
Aerial will focus on remote sensing, cargo drone services andconnectivity applications. In defence we will shape sovereign
European programmes such as a medium-altitude, longendurance UAS, while concurrently developing teaming andswarming solutions;■take leadership in space solutions: As the no. 1 in Europe
and no. 3 in the world, we aim to further strengthen our
position by pushing innovation and accessing new customers.
We will develop next generation space-based systems todeliver earth-observation, telecom and connectivity solutions,and offer cutting-edge in-orbit services;■establish a leading position in cyber for governments
and critical industries: We will protect Airbus and its
products against cyber attacks, and develop solutions toprotect government and critical industry assets, products
and operations;■
make digital services and secure connectivity our new
growth engine: Digital platforms will be a key enabler forthe creation of future data-driven services and new businessmodels, e.g. drone services, imagery intelligence or aircraft
in-service support. We also aim to be a leader in end-to-end
secure connectivity across satellite, terrestrial, maritime andairborne networks;■
grow our capability in the US: Leveraging our existingproducts and services, we will strengthen our positionin the US market through innovation and select strategic
partnerships.

MarketAirbus Defence and Space is mainly active in public andpara-public markets. As a general trend, defence budgets in
Europe are set to gradually increase, triggered by heightened
security risks and reinforced by recent discussions on the NATOcommitments. 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, including the joint development of militaryand security capabilities; together, these may provide new sales
opportunities through members’ collaborative procurement
mechanisms. Market access outside the home countries may besubject to restrictions or preconditions such as national content.

Nevertheless, Airbus Defence and Space, in conjunction with
Airbus, is well-placed to beneﬁt from growth potential in defence
across its solutions.

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 a 2%of 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.
With its C295 platform, Military Aircraft has also entered into
the leasing market for civil operation, such as the UN World
Food programme, and is looking for other civil opportunities.

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, Lockheed Martin, Leonardo, UAC, Kawasaki,
Ilyushin, AVIC and Antonov/Taqnia.
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 ﬂ eets. 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 ﬂya long range strategic aircraft into a tactical zone of operation.

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1.1 Presentation of the Company

In revenues, Airbus is the largest continental European combat
aircraft manufacturer. The major combat aircraft activities aretaking place through the contribution to the Euroﬁghter Typhoon
programme jointly with the consortium partner companies BAE
Systems and Leonardo. Competitors in the segment of combat
aircraft include Boeing, Dassault, Lockheed Martin, Saab andSukhoi.

Market Trends
The sale of aircraft is expected to remain sound in thetransport and special mission aircraft segments and even growconsiderably for the heavy transport segment, where the A400M
occupies a unique position.
In 2017, a contract for the supply of 24 units to Qatar was
secured for the Euroﬁghter Typhoon consortium. A number offurther sales are expected, prolonging the Euroﬁghter Typhoon
production life.
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 announcement of France and Germany in July 2017 to jointly
develop and procure the next generation ﬁghter jet may also
contribute to 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, scientiﬁc / explorationand navigation satellites, competition in Europe is organised ona national and multinational level, primarily through the European
Space Agency (ESA), the European Commission (EC) andnational space agencies.
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 for
Earth observation systems, for which the Company is a leading
provider. The export market is expected to continue growing
over the medium-term.
For military customers, demand for telecommunication andobservation 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, inparticular from ESA, NASA, Roscosmos (Russia) and NASDA(Japan). Such systems are usually built in cooperation withinternational partners. The International Space Station (ISS),
together with related vehicle and equipment development
programmes and services, constitutes the predominant ﬁeld ofactivity in this segment and Airbus Defence and Space leads as
prime contractor on industrial level the European contribution to
the international Space Station ISS. Airbus Defence and Spaceis involved in NASA’s Orion project as the prime contractor for
the European contribution: the mission-critical service moduleof the MPCV (Multi-purpose Crew Vehicle) Orion spacecraft,which will allow astronauts to ﬂy beyond low Earth orbit for theﬁrst time since the American Apollo programme.
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,
MDA and Orbital in the US, Thales Alenia Space in France and
Italy, and Information Satellite Systems Reshetnev in Russia. The
market for telecommunications satellites is expected to remain
largely stable over the coming years at a level of approximately
20 orders per year on average.
The market for commercial launch services continues to evolve.
Competitive pressure is increasing in light of other competitors
entering or coming back into the market. ArianeGroup provides acomplete range of launch services with the Ariane, Soyuz, Vega
and Rockot launchers. Competitors for launch services include
ILS, SpaceX, ULA, Sea Launch and CGWIC. The accessible
market to Arianespace for commercial launch services forgeostationary satellites is expected to remain stable at around20 payloads per year. However, due to various factors (such astechnology advances, increasing competition and consolidationof customers), this ﬁgure remains volatile. This market does
not include institutional launch services for the US, Russian orChinese military and governmental agencies.
In 2015 Airbus Defence and Space announced the creation of
OneWeb Satellites JV, an equally owned company with OneWeb
that will design and build 900+ satellites for the OneWeb
constellation programme. This 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.

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Communications, Intelligence & Security

Unmanned Aerial Systems

The Communications, Intelligence and Security (CIS)
Programme Line brings together the growing but increasinglycompetitive market for satellite and terrestrial communication,
intelligence and security services and solutions. CIS serves
a common customer base which includes governments,
defence institutions, security and public safety agencies,
and increasingly commercial sectors such as transportation(maritime, aviation, road), energy (oil, gas, electricity), mining
and agriculture.

Customers

This programme line is divided into four clusters: Intelligence,
Secure Communications, Cyber Security and Security
Solutions.
Through Intelligence, Airbus Defence and Space develops
Command and Control solutions for Ministries of Defence.
Competitors in this area largely come from European orAmerican based defence companies. Intelligence is also
amongst the largest players in the satellite imagery (opticaland radar) market. This sector remains mainly government
orientated. However, the demand for satellite imagery is growing
in commercial markets as many companies see geospatial data
as key information for their business development.
Through its Secure Communications cluster, Airbus
Defence and Space is also a leader in governmental satellite
communications. This cluster offers a full portfolio of mobileand fixed satellite communication and terrestrial securecommunications solutions for application at sea, on land andin the air. Customers are Ministries of Defence, Ministries ofInterior and NGOs.
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
increase of cyber-attacks, the increase in use of connectedassets and global digital transformation. Customers aregovernments and private companies with a high grade security
requirement.
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 andsustainable new business bringing proﬁtable revenue to Airbus
Defence and Space on a scale signiﬁcant to the Division within
ﬁve years.
CIS focuses on public customers such as armed forces forgovernment satellite communications, where we have long-term
relationships with our customers. Whereas budget pressureson public expenditure are high in Europe, investment into theservices and solutions offered by CIS is likely to continue in theface of new global security threats, a re-emphasis on defence
and security and the growth in demand for digital services. CIS
has the objective to develop and scale digital services e.g. newservices based on data generated by existing Airbus Defence
and Space products to generate signiﬁcant proﬁtable revenues.

Unmanned Aerial Systems could lead to diversiﬁ cation into
services-driven markets. It is also a sector in which Europe
has a strong need for investment, which could set the stage for
new cooperation programs. France, Germany, Italy and Spain
have signaled their intention to cooperate on a medium altitude,
long endurance Unmanned Aerial System and Airbus Defence
and Space is participating in the two-year deﬁnition study ofthe system.

Competitors
With regards to platforms, Chinese, Israeli and US ﬁrms are wellestablished in the Unmanned Aerial Systems market segment,along with other European companies such as BAE Systems,
Dassault and Thales, who are competing for new European
projects. The market itself features strong growth with signiﬁcant
opportunities in Europe, the U.S. and Asia Paciﬁc.

Market Trends
Unmanned Aerial Systems have a very promising growthpotential. Market structures in this segment are not clearly
set out yet and will see some movement, 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 sevenlaunch customer nations Belgium, France, Germany, Luxemburg,
Spain, Turkey, the UK and one export customer, Malaysia. Type
Certiﬁcate and Initial Operating Clearance have been achievedin 2013. Since then, 57 units have been delivered to six nations
by the end of 2017. 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

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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
Aerial Refueling Boom System (ARBS) and under-wing refuelingpods. At the end of 2017, the A330 MRTT programme has atotal of 56 aircraft ﬁrm orders by eight customers, of which 29
already delivered and in service in four 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.
Airbus Defence and Space signed long-term global sustainment
and material availability contracts for the Euroﬁghter Typhoon
weapon system with the UK, Spain, Italy and Germany. The
new agreement on Contract 1, effective 1 January 2017, runs
for ﬁve years and is the second phase of sustainment for theEuroﬁghter Typhoon weapon system for all core nations forming
the baseline for all in-service activities.
The new Contract 3, also effective from 1 January 2017, runs
as well for ﬁve years and is the ﬁrst milestone on the way to
performance based logistics securing for the ﬁrst time material
availability for the Spanish and German air forces.
At the end of 2017, a total of 599 Euroﬁghter Typhoon aircraft
had been ordered by eight customers (UK, Germany, Italy,
Spain, Austria, Saudi Arabia, Oman and Kuwait), with a totalof 532 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 morethan 30 years in service, this family of aircraft has proven to
be robust, reliable, high-performing, efﬁcient, ﬂexible, easy tooperate in any environment, and at low operating costs. 490
orders had been recorded for both CN235 and C295 types
together at the end of 2017, with 22 aircraft ordered in 2017.
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 ﬂ ight 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 programs for aircraft
such as the Tornado and P-3 Orion. Airbus Defence and Space
maintains a network of Maintenance, Repair and Overhaul
centers strategically located throughout the world for greater
proximity to the customer, for example in Seville or Manchingin Europe, in Mobile, Alabama (US) or at subsidiaries in Saudi
Arabia or Oman.

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 served to become the prime contractor for theEuropean service module of NASA’s next generation manned
capsule MPCV Orion.
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 sole

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prime 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 additiona new industrial set-up was announced with the creation of
ArianeGroup between the two main Ariane manufacturers. Thisvertical integration secures the future by cutting costs and being
more competitive. Ariane 6 is targeted to be launched in 2020.
Telecommunication satellites. Airbus Defence and Space
produces telecommunication satellites used for both civil
and military applications, such as television and radio
broadcasting, ﬁxed and mobile communication services andInternet broadband access. Current Airbus Defence and Space
geostationary telecommunication satellites are based on theEurostar family of platform, the latest version of which is theEurostar E3000, including an all-electric variant. In 2015, Airbus
Defence and Space also started the development of the Eutelsat
Quantum telecommunication satellite, which will be the ﬁrst
satellite that can be fully reconﬁgured in orbit through its ﬂexible
antennae and repeater. Through its contract with OneWeb todesign and produce 900 small telecommunication satellites fora constellation in Low Earth Orbit, Airbus Defence and Spaceis spearheading the industrial and commercial development ofvery 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 ﬁ rst 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 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.

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.

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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 isfully operational since 2009 and extends to 2022. In Abu Dhabi,
Airbus Defence and Space together with Thales Alenia Space
built a secure satellite communication system.
Cyber Security. Airbus Defence and Space has established acyber security business to meet the growing cyber security needsof users of critical IT infrastructure, including governments andglobal companies. Airbus Defence and Space provides expertiseand 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 highsecurity national solutions and consulting and training services,
Airbus Defence and Space has a long track record in providing
the most sensitive secure IT and data handling and training
solutions to defence and security customers throughout France,
Germany, the UK and other NATO countries.

Security Solutions
Security Solutions include sensor networks ranging fromIR and video cameras through radars to airborne and spacesurveillance systems, all connected to command and control
centres, mainly for border security systems. Apart fromIntelligence, Surveillance and Reconnaissance (ISR) systems
for gathering, 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.

Unmanned Aerial Systems
In the field of Unmanned Aerial Systems (UAS), Airbus
Defence and Space is active at both product and service
level. Airbus Defence and Space is the leading UAS Service
provider for the German air forces meeting their MediumAltitude Long-Endurance (MALE) Intelligence, Surveillance andReconnaissance needs in the operational theatre. These interim
solutions, based on non-proprietary MALE systems, will be
replaced by a new generation European MALE system where
Airbus Defence and Space is working on the Deﬁnition Studywith its European partners. Airbus Defence and Space also
provides mini-UAS to the French armed forces and selectedexport customers and the KZO UAS to the German armed
forces. It is developing the solar-powered Zephyr for the UK
MoD, but also for civil applications such as relay stations forinternet provision to remote or sparsely populated regions.
In May 2017, Airbus Aerial was launched. It brings together
a variety of aerospace technologies – including drones andsatellites – combines them in a software infrastructure, andapplies industry speciﬁc analytics to deliver tailored solutions
to help its customers efﬁciently run their business. The portfolioof services will primarily focus on three applications – remotesensing, cargo drone services and connectivity. The Airbus
Aerial activities will span both drone enabled digital services aswell as the development of certiﬁable drones. Its focus lies oncommercial customers in agriculture, insurance, infrastructure,state and local government.

Production
Airbus Defence and Space is headquartered in Munich. The
main engineering and production facilities of the Division
are located in France (Paris region and southwest France),
Germany (Bavaria, Baden-Württemberg and Bremen), Spain(Madrid region and Andalusia) and the UK (southern Englandand Wales). In addition, Airbus Defence and Space operates
a global network of engineering centres and ofﬁces in morethan 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

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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
Following on from the 2014 and 2015 share sales, the Company
sold in 2016 approximately 0.83 million shares in Dassault
Aviation, representing around 9.05% of the Company’s sharecapital at the time. As a result of the implementation of 2016
and 2017 Dassault Aviation’s share buyback programs andof Dassault Aviation’s capital increase, which took place on

21 June 2017 and at the occasion of which 61,136 shareswere issued to remunerate the shareholders who opted for adividend payment through attribution of shares, the Company
holds approximately 9.93% of Dassault Aviation’s share capitaland 6.16% of its voting rights. In case of exchange in full of thebonds issued by the Company and which are due in 2021, theCompany will no longer hold any of Dassault Aviation sharesand voting rights.

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. A continuous task of IRM in 2017
was to further improve efﬁcient and appropriate corporate andproject-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 are inplace for all insurable risks worldwide for Airbus. A systematic
review, monitoring and reporting procedure applicable to all
Divisions is in place to assess the exposure and protection
systems applicable to all Airbus sites. The Company’s insurance
programmes cover high risk exposures related to its assets
and liabilities.

1.1.7

Asset and liability insurance policies underwritten by IRM for
the Company cover risks such as property damage, businessinterruption, aviation and non-aviation general and productliability. IRM also provides a Group insurance policy for
Supervisory and Managing Board members and certain other
employees of Airbus, 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 reasonablerates, 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 Airbus.

Legal and Arbitration Proceedings

Airbus 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
than as described below, Airbus is not aware of any material
governmental, legal or arbitration proceedings (including any
such proceedings which are pending or threatened), during aperiod 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’ ﬁnancial position or proﬁtability.

Regarding Airbus’ provisions policy, Airbus recognises provisions
for litigation and claims when (i) it has a present obligation fromlegal actions, governmental investigations, proceedings andother claims resulting from past events that are pending or
may be instituted or asserted in the future against Airbus, (ii) it
is probable that an outﬂow of resources embodying economic
beneﬁ ts will be required to settle such obligation and (iii) a
reliable estimate of the amount of such obligation can be made.
Although Airbus believes that adequate provisions have been1

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made to cover current or contemplated general and speciﬁclitigation and regulatory risks, no assurance can be provided thatsuch provisions will be sufﬁcient. For the amount of provisions
for litigation and claims, please refer to the “— Notes to the
IFRS Consolidated Financial Statements — Note 22: Provisions,Contingent Assets and Contingent Liabilities”.

WTO
Although Airbus is not a party, Airbus 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 the same day, the EUlaunched 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 the extension until the end of2040 of subsidies originally granted by 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 Commercial Aircraft from European Governments. On
1 December 2011, the EU informed the WTO that it had taken
appropriate steps to bring 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 is now under WTO review pursuant to WTO rules.
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 bring its 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 is now under WTO review pursuant to
WTO rules.
Exact timing of further steps in the WTO litigation process issubject to further rulings and to negotiations between the US
and the EU. Unless a settlement, which is currently not underdiscussion, is reached between the parties, the litigation is
expected to continue for several years.

GPT
Prompted by a whistleblower’s allegations, Airbus conductedinternal audits and retained PricewaterhouseCoopers (“PwC”) to
conduct an independent review relating to GPT Special ProjectManagement Ltd. (“GPT”), a subsidiary that Airbus acquired in2007. The allegations called into question a service contract
entered into by GPT prior to its acquisition by Airbus, relating toactivities conducted by GPT in Saudi Arabia. PwC’s report wasprovided by Airbus to the UK Serious Fraud Ofﬁce (the “SFO”) in
March 2012. In the period under review and based on the work
it undertook, nothing came to PwC’s attention to suggest that
improper payments were made by GPT. In August 2012, the SFO
announced that it had opened a formal criminal investigation
into the matter. Airbus is in continuing engagement with theauthorities.

Euroﬁghter Austria
In March 2012, the Munich public prosecutor, following a request
by the Vienna public prosecutor, launched a criminal investigation
into alleged bribery, tax evasion and breach of trust against 16
individuals, among them former and current employees of EADS
Deutschland GmbH (renamed on 1 July 2014 Airbus Defence
and Space GmbH) and Euroﬁghter Jagdﬂugzeug GmbH. The
proceedings are related to the sale of Euroﬁghter aircraft to the
Republic of Austria in 2003. After having been informed of theinvestigation in 2012, Airbus retained the law ﬁrm Clifford Chance
to conduct an independent fact ﬁnding review. Upon concluding
its review, Clifford Chance presented its fact ﬁnding report toAirbus in December 2013. Airbus provided the report to theMunich public prosecution. Airbus has been fully cooperatingwith the authorities. Regarding the question of deductibilityof payments made in connection with the Euroﬁghter Austria
campaign, Airbus Defence and Space GmbH settled with the
tax authorities in August 2016.
Since the result of the investigation by the public prosecution
did not conﬁrm the allegations of bribery, the Munich publicprosecution (Staatsanwaltschaft München I), in order to conclude
the investigation in relation to Airbus Defence and Space GmbH(the c ompany), has issued an administrative penalty noticeagainst the company under the German Act on Administrative
Misdemeanours (“Ordnungswidrigkeitengesetz”). The notice
is based on the allegation of a negligent breach of supervisory
duties of non-identiﬁ ed members of the c ompany’s former
management. The notice alleges that former management
negligently failed to ensure proper internal controls that would
have prevented employees from making payments to business
partners without proven documented services. The monetary
penalty amounts to € 81.25 million (comprising an administrative
ﬁ ne of € 250,000 and € 81 million of disgorged proﬁ ts). The
notice explicitly acknowledges the efforts of Airbus and its
management to successfully install a completely overhauled
compliance system starting in 2012. The company, supported
by its direct Group shareholders and ultimately Airbus SE, haswaived any remedy against the notice.
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.
On 18 September 2017, Airbus ﬁled a submission to the Vienna
Public Prosecutor in response to the allegations of deception
in the procurement of Euroﬁghter combat aircraft made by theAustrian Defence Minister. Airbus is cooperating fully with theauthorities.

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Investigation by the UK SFO and France’s PNF

Other Investigations

In the context of review and enhancement of its internal
compliance improvement programme, Airbus discovered
misstatements and omissions relating to information provided
in respect of third party consultants in certain applications forexport credit ﬁnancing for Airbus customers. In early 2016,
Airbus informed the UK, German and French Export Credit
Agencies (“ECAs”) of the irregularities it had discovered.
Airbus made a similar disclosure to the UK Serious Fraud
Ofﬁce (“SFO”). In August 2016, the SFO informed Airbus thatit 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 Airbus that it had also opened a preliminary
investigation into the same subject and that the two authorities
would act in coordination going forward. Airbus is cooperating
fully with both authorities including in respect of potential issues
across Airbus’ business. As part of Airbus’ engagement with
the US authorities, the latter have requested information
relating to conduct forming part of the SFO/PNF investigationthat could fall within US jurisdiction. Airbus is cooperatingwith the US authorities in close coordination with the SFO
and PNF. The SFO and PNF investigations and any penalties
potentially levied as a result could have negative consequences
for Airbus. The potential imposition of any monetary penalty(and the amount thereof) or other sanction including tax liability
arising from the SFO and PNF investigations will depend on
the ultimate factual and legal ﬁ ndings of the investigation,and could have a material impact on the ﬁnancial statements,
business and operations of Airbus. However, at this stage it
is too early to determine the likelihood or extent of any suchpossible consequence. Investigations of this nature could
also result in (i) civil claims or claims by shareholders against
Airbus (ii) adverse consequences on Airbus’ ability to obtain orcontinue ﬁnancing for current or future projects (iii) limitations
on the eligibility of Group companies for certain public sector
contracts and/or (iv) damage to Airbus’ business or reputation
via negative publicity adversely affecting Airbus’ prospects inthe commercial market place.

In 2014, the Munich public prosecutor investigated potential
irregularities in relation to a project of Tesat-Spacecom GmbH &Co. KG. The Munich public prosecutor launched administrative
proceedings in the context of this investigation against TesatSpacecom GmbH & Co. KG. In January 2018 the publicprosecutor terminated the investigation against individuals
as well as the administrative ﬁne procedure relating to TesatSpacecom GmbH & Co. KG.

ECA Financing
The ﬁ nancing environment remains healthy. A high level ofliquidity is available in the market at good rates for our attractive
portfolio of products. In 2017 ECA ﬁ nancing had not been
made available to Airbus but Airbus and the ECAs have now
reached agreement on a process under which we are able toresume making applications for ECA-backed ﬁnancing for ourcustomers across the Group on a case-by-case basis. We
anticipate a return to ECA cover in 2018 for a limited number oftransactions while the level of appetite for commercial ﬁnancing
remains high.

In April 2017, the Munich public prosecutor terminatedadministrative proceedings against former EADS DeutschlandGmbH (now Airbus Defence and Space GmbH) with regard toborder security projects in Romania and Saudi Arabia. Alreadyin 2016, corresponding investigations against former and current
employees of the EADS Group were terminated.
Airbus is cooperating with a judicial investigation in France related
to Kazakhstan. Airbus is not a party to these proceedings.
Airbus is cooperating with French judicial authorities pursuant toa request for mutual legal assistance made by the governmentof Tunisia in connection with historical aircraft sales.
Following a review of its US regulatory compliance procedures,
Airbus has discovered and subsequently informed relevant US
authorities of its ﬁndings concerning certain inaccuracies inﬁlings made with the US Department of State pursuant to Part
130 of the US International Trafﬁc in Arms Regulations (ITAR)(a US export control regulation). Airbus is cooperating with the
US authorities. Airbus is unable to reasonably estimate the time
it may take to resolve the matter or the amount or range ofpotential loss, penalty or other government action, if any, that
may be incurred in connection with this matter.

Review of Business Partner Relationships
In light of regulatory investigations and commercial disputes,
including those discussed above, Airbus has determined toenhance certain of its policies, procedures and practices,
including ethics and compliance and export control. Airbus isaccordingly in the process of revising and implementing improved
procedures, including those with respect to its engagement ofconsultants and other third parties, in particular in respect of sales
support activities and is conducting enhanced due diligence as apre-condition for future or continued engagement and to inform
decisions on corresponding payments. Airbus engaged legal,
investigative, and forensic accounting expertise of the highest
calibre to undertake a comprehensive review of all relevant third
party business consultant relationships and related subject
matters. Airbus believes that these enhancements to its controls
and practices will best position it for the future, particularly in lightof advancements in regulatory standards. Several consultants
and other third parties have initiated commercial litigation andarbitration against Airbus seeking relief. The comprehensive
review and these enhancements of its controls and practices
has led to additional commercial litigation and arbitration
against Airbus and may 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.

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Commercial Disputes
In May 2013, Airbus was notiﬁ ed of a commercial dispute
following the decision taken by Airbus to cease a partnershipfor sales support activities in some local markets abroad. Airbus
believes it has solid grounds to legally object to the alleged
breach of a commercial agreement. However, the consequencesof this dispute and the outcome of the proceedings cannot be
fully assessed at this stage. The arbitration will not be completed
until 2018 at the earliest.

In the course of another commercial dispute, Airbus 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
arbitral award was rendered on 12 January 2018 with a principal
amount of € 104 million plus interest and costs against Matra
Défense S.A.S. Airbus is studying the award and considering
the next steps.

1.1.8 Non-Financial Information

1.1.8.1

Airbus’ Approach to Responsibility& Sustainability

Airbus and its Main Stakeholders
Airbus is an industrial company operating in businesses
with long product lifecycles and corresponding returns on
investment. There are signiﬁcant costs and risks in programme
development and cyclical civilian markets. These features deﬁne
the Company and shape its relationships with all stakeholders.
For a description of Airbus’ business model, see “— 1.1.1
Overview”.
Airbus is engaged in stakeholder dialogue at various levels of
the Company. Cooperation being at the heart of Airbus since
its inception, the Company strongly encourages exchanging
on best practices, understanding different perspectives andimproving its performance in every activity. The responsibility
for stakeholder engagement is decentralised at Airbus andemployees are encouraged to initiate, develop and maintainrelationships with their respective stakeholders. Airbus often
seeks a sectorial approach in 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, Airbus
must respond to their expectations about development,
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,
Airbus has performed a materiality assessment in 2017.
With the support of consultants, Airbus approached a set ofstakeholders representing customers, works councils, local
community partners, NGOs, technological partners, investors,
airworthiness authorities, MROs, government bodies, suppliers
and industry associations. Airbus chose a qualitative approachrather than a quantitative approach. In-depth interviews wereconducted with external stakeholders. A list of top issues for
the Company was developed, consolidated and ranked by theCompany’s Responsibility & Sustainability Network. The network
gathers a group of experts advising on Airbus’ Responsibility& Sustainability (“R&S”) strategy, monitoring progress in theirrespective areas of responsibility, sharing knowledge and bestpractices throughout the entire Company. It is trans-functional,trans-national and trans-divisional and meets on a regularbasis. The outcome of this assessment was shared with top
management.

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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

Economic

Community
impactSecurity

HIGH

HIGHERHIGHEST

CRITICAL

INCREASING CONCERN / IMPACT ON AIRBUS
Environment

SocialEconomy & Governance

UN Sustainable Development Goals

Responsibility & Sustainability Charter

Airbus is committed to the UN Global Compact principles andhas reached the “Advanced Level”.

In 2017, Airbus has outlined its commitments in a new R&S
Charter. The aim of the Charter is to demonstrate how Airbus
intends to contribute to the requirements and needs of society
and how employees will live Airbus’ six values in their daily workwith all stakeholders whether customers, suppliers, partners,
shareholders. The Charter is available at www.airbus.com.

Airbus adopted the UN Sustainable Development Goals (SDGs)
in December 2015 as a framework to align its responsible andsustainable contributions. Over 2016, Airbus performed amapping of its contributions based on the Company’s publicly
available information (including the Company’s web site, annual
report and press releases). It demonstrated that at least eightof the 17 SDG goals are directly relevant to Airbus’ businesses
and stakeholders’ feedback conﬁrmed that Airbus 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;■
SDG 17: Partnerships for the goals.
Throughout 2017, Airbus continued the mapping internally andidentiﬁed KPIs to assess its overall contributions to the above
SDGs. Measurement will start in 2018.

Airbus’ Way Forward: Vigilance Plan
Airbus 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, Airbus has
adopted internal policies and management tools to performthe assessment, monitoring, mitigation, reporting of risk
and compliance allegations. They are fully embedded into
the Company’s culture and processes. At Airbus, heads ofprogrammes and functions, supported by their respective
specialists, shall ensure proper deployment of the Company’s
policies, management of Enterprise Risk Management (ERM) in
their ﬁelds as well as duly reporting issues to top management.
Airbus’ approach is thus based on its existing strengths:
1) strong management process already established andadopted by employees;2) empowerment of specialists;
3) industry approach whenever possible.

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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 deﬁ ne concrete actions in order to ensure continuous
monitoring of the entire Company and to mitigate principal risks
or prevent serious violations. Airbus is also working to ensurethat internal processes will be adjusted in order to ensure the
efﬁciency of all measures.
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,
health and safety and the environment. The ERM system was
updated to take into account the most signiﬁcant potential risks
related to these areas that Airbus may generate as part of its
operations. The ERM team also adjusted its procedures so thatthese potential new risks and their likely adverse impacts canbe duly assessed throughout the Company. For each risk, adedicated action plan is being deﬁned by the responsible team
who will monitor its deployment throughout the Company. The
potential new risks and related action plans will be consolidated
and reported to the top management of the Company. For acomplete description of Airbus’ ERM system, see “— Corporate
Governance — 4.1.3 Enterprise Risk Management System”.
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. Subject to regulatory approval, Airbus intends for
employees to be able to raise their concerns, if any, about
violations of human rights and fundamental freedoms, healthand safety and environmental policies.
Airbus is also reinforcing its training for employees related tohuman rights as well as other topics related to responsibility
and sustainability. Airbus currently proposes over 80 e-learning
courses on labour relations, diversity, environmental and healthand safety matters to its employees. In addition, the Company
also provides training to its employees on the Airbus Standards ofBusiness Conduct. Finally, a R&S learning programme targeting
employees to be trained on new regulations and supporting
cultural change will be developed and launched in 2018.
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. Currently, Airbus and its Divisions
have different governance directives for the afﬁliates in theirrespective scopes with the aim to have a single governancedirective in 2018. The objective of the corporate governancedirectives for Airbus’ afﬁliates is to deﬁne rules, processes andprocedures applicable to Airbus afﬁliates and their respective
boards, directors and ofﬁcers. The document is used to assist

Airbus afﬁliates in effectively fulﬁlling their responsibilities while
assuring Airbus’ ongoing commitment to high standards ofcorporate governance.
Each afﬁliate with operational activities has in place a Board of
Directors and/or a shareholders’ meeting where the strategic
decisions are made. Each afﬁliate has an Airbus supervisor who
is a member or chairman of the board who ensures that all Airbus
requirements are considered by the afﬁliate’s management.
The board will consider the afﬁliate’s accounts, the operating
and development plans, the Company performance versus the
allocated targets, human resources topics and ERM. At least
once a year the agenda of the board will include an update on
ethics and compliance matters (including training, awarenessand any other relevant issues).
In order to ensure proper and systematic cascading of CSRrelated policies throughout the Company, Airbus’ head of
Subsidiaries and Afﬁliates has joined the R&S Network while,in return, each impacted function has appointed an ofﬁcial pointof contact that can support afﬁliates in the implementation ofthese policies.
In 2018, Airbus will update its directive on CSR-related policies
requirements applicable to its afﬁliates. Airbus will communicate
the necessity to ensure deployment and monitoring of thefollowing policies described in this chapter:■
International Framework Agreement;■
Agreement on the European Works Council;■
Supplier Code of Conduct;■
Health & Safety Policy;■
Standard of Business Conduct;■
Environmental Policy;■
Airbus Anti-corruption Policy and Directives.
Afﬁliates will be asked to evaluate the newly identiﬁed potential
risks via the Airbus ERM system as well as to regularly monitor
them as part of their risk assessment process. Airbus will
ensure that the procedures to assess, investigate and manage
allegations are well-aligned throughout the Company. In addition,a self-assessment of afﬁliates regarding social, human rights,
and environmental matters will be organised, starting in 2018.
For its principal joint ventures, Airbus will ensure the proper
application of its policies or those of its partner.
The overall plan will be shared with employees throughout theyear.
A dedicated programme has been launched by the Procurement
function in order to monitor Airbus’ suppliers and develop
processes to identify potential serious harm to human rights,
fundamental freedom, health and safety and the environment
with the aim of preventing them. For more information, see thededicated chapter on the supply chain, including the vigilance
plan for suppliers, under chapter 1.1.8.4 (b) Responsible
Suppliers.

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1.1 Presentation of the Company

1.1.8.2

Responsible Manufacturera. Product Safety
Airbus recognises and values the trust the ﬂ ying public puts
in its aircraft, and this is the reason the Company constantly
strives to improve safety any way it can. Its investment insuccessive generations of aircraft which embody new andsafer technologies have been very successful in achieving
an ever-decreasing number of accidents despite an everincreasing number of ﬂights.
Today, with the rate of accidents at an all-time low, Airbus
is working even harder to ensure that accidents remain rare
events.
This is why it is Airbus’ top priority to continually improve safety.
Its commitment to safety starts at the top, is reﬂected in the
structure of its organisation, and is most deeply embodied in
the mind-set employees bring to work.
At every point in design, manufacturing and assembly, Airbus
makes sure that its aircraft not only comply with but exceed
the safety requirements laid down by the European Aviation
Safety Authority (EASA) and the US Federal Aviation Authority(FAA). The development of the Fly-By-Wire and ﬂight envelope
protection technologies more than 25 years ago, or more
recently the Runway Overrun Prevention System, are examplesof signiﬁcant contributions to safety introduced by Airbus andnow becoming industry standards.
Whenever safety topics must be discussed, it is done at theappropriate level, including by Airbus’ senior executives. By
acting together, the Company ensures that the full power ofcoordinated cross-company action can be brought to bearon any issue where it is believed that safety can be further
enhanced.
The Product Safety Process (PSP) is Airbus’ primary means ofresponding to what is happening with the 10,000 Airbus aircraft
ﬂ ying 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. In this way, Airbus is actively enhancing
the safety level for its products and helping to advance thesafety level for the whole industry.
The PSP is now evolving to be part of Airbus’ Safety
Management System (SMS), formalising Airbus’ evolution toa risk management approach to safety. Both the PSP and the
SMS rely on a network of safety representatives within each
Division of the Company. All Airbus employees, including thosein the safety network, are trained to recognise that the lives ofpassengers and airline personnel can depend on their personalcommitment to safety, and to ensure that they are aware of
how their personal actions can improve safety.

Airbus and its employees at all levels therefore work hard toensure safety in:■
the design of aircraft to higher levels than those required by
EASA/FAA Part 25 regulations;■the quality of manufacturing in line with its EN 9001
certiﬁcation;■
the materials/manuals supplied to customers to operate andmaintain the aircraft;■
the training provided to flight crews, cabin crews andmaintenance crews;■
the worldwide services delivered in support of the aircraft’s
operation.
Yet what makes a ﬂight safe is a combination of a safe aircraft,safe airline operations and a safe air transport system.
Therefore, even if the primary responsibility of Airbus as amanufacturer is the aircraft, the scope of safety at Airbus
reaches beyond the product and also includes an active roleat the air transport system level.
Airbus is in constant contact with other aircraft manufacturers,
airlines and air safety organisations around the world to ﬁnd
new ways of improving safety standards. The Company
believes that industry wide cooperation is crucial to making
further safety enhancements.
Airbus has put in place a harmonised approach to productsafety throughout the Company. Similar processes and tools
to those described above for Airbus commercial aviation are inplace at Airbus’ Divisions, Defence and Space and Helicopters.
These include a dedicated Product Safety function, which is
empowered to take action across the business to ensure thesafety of all operations, daily monitoring and managementof safety topics and deployment of a SMS as well as related
speciﬁc organisation approvals by competent organisations.
However, the implementation of these harmonised processes
was adjusted to the speciﬁcities of their activities and of theregulatory requirements. For example, there is no regulation
to manage companies and ofﬁcial organisations’ participationin safety investigation for the military world. In addition, due tothe nature of military activities, investigation are often classiﬁed
as conﬁdential or restricted for ofﬁcials.

b. Research & Technology
In 2017, CTO underwent a transformation programme tobecome more agile, innovative and aligned with the needs ofAirbus. The new organisation applies a lean, project-based
approach, will encourage collaboration with external researchcommunities and develop partnerships, especially throughopen innovation with technical and scientiﬁc experts.
The CTO organisation is responsible for: guiding all R&T
activities of the Company and ensuring Airbus-wide integrationof technology through Technology Planning and Roadmapping,
accelerating the development of selected technologies throughFlight Demonstrators together with the Divisions, providing
expertise in breakthrough technologies in support of the groupwide projects in Central R&T and developing technologies forthe next generation aircraft in Airbus R&T.

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Technology Planning and Roadmapping developed a set oftechnology roadmaps spanning the R&T portfolio, which areused to analyse technology progression using key ﬁgures ofmerit and is starting to provide a valuation methodology for
the R&T activities.
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 organised in ﬁ ve boost areas – Data Science,
Materials, Communication Technologies, Electrics Expertiseand Virtual Product Engineering. A research vision andnew ways of working were implemented with a short cycle
for testing new ideas and decision gates for the creation oflarger projects. The transitioning from the former Airbus Group
Innovations is ongoing through 2018.
Airbus R&T portfolio will be organised in three areas startingin 2018 to better adapt to Airbus product policy and businessneeds – Enhancing our Aircraft Programmes, Next New Aircraft,and Digital Design & Manufacturing. The organisation started
a transformation programme aiming for speed, agility and highperformance with a ﬂatter hierarchy and empowered teams.
In addition to the domains described above, ﬁve technology
thrusts were established to ensure coherency in the portfolioof activities and to rapidly advance strategic priorities. Thesethrusts are:■
Electriﬁcation;■
Digital Design and Manufacturing;■
Connectivity;■
Autonomy;■
Materials.

and high-power systems by ground testing, accelerating
technology readiness in collaboration with Siemens anddeveloping and supplying hybrid-electric propulsion systems
and hardware for Flight Demonstrators.
In 2017, it continued to support electriﬁ cation projects,
including providing the test bench for CityAirbus.
A3

A 3 (pronounced “A-cubed”), is the advanced projects andpartnerships outpost of Airbus in Silicon Valley with the mission
to disrupt the aerospace industry.
■
Altiscope launched in 2017 to help integrate 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 ofairborne trafﬁc.
■
Vahana is an electric urban air mobility vehicle designed tocarry a single passenger or cargo. A3 is aiming to make it
the ﬁrst certiﬁed passenger aircraft without a pilot. The ﬁrst
Vahana full-size prototype is scheduled to ﬂ y in early 2018.
■
Transpose, launched in December 2016, rethinks the aircraft
cabin architecture and passenger experience possibilities.
The project demonstrated user tests in a modular cabin in
its alpha phase.
■
Voom delivers an on-demand urban air mobility service using
helicopters. It successfully completed its beta phase pilot in
Sao Paulo, Brazil, and will continue as a business in 2018
within Airbus Helicopters.
■
Airbus China Innovation Centre (ACIC): This year, asecond innovation centre was opened in Shenzhen, China.
Like A3, it is focused on technologies and business models
that could be disruptive to the core business. However, it willleverage the hardware ecosystem in Shenzhen, and talentpool in China to develop projects. The ﬁrst ACIC project will
be launched in 2018.
BizLab

Key Progress in 2017
Flight Demonstrators

E-Fan X Programme
The E-Fan family of technology demonstrators was abold step towards all-electric and hybrid-electric flight
aimed at establishing requirements for future certiﬁcationof electrically powered airplanes and at training a newgeneration of designers and engineers for the challenges ofelectric ﬂying. In March 2017, the Airbus Executive TechnicalCouncil decided to refocus Airbus’ efforts on electric ﬂight
towards a more ambitious project, which aims to develop
a hybrid-electric demonstrator baptised the “E-Fan X”, a
stepping stone towards a hybrid electric single aisle aircraft.
In November 2017, E-Fan X was launched in conjunction
with Siemens and Rolls-Royce. E-Fan X will be poweredby a 2 MW motor, which is one order of magnitude greaterthan E-Fan 2.0’s motor.
■
E-Aircraft Systems House (EAS)
The EAS aims to verify hybrid- and electric propulsion
systems functionality and performance for low, medium,■

Airbus BizLab is the aerospace accelerator where startups
and Airbus intrapreneurs speed up the transformation of
innovative ideas into valuable businesses. BizLab offers earlystage selected projects wide-ranging support in the form ofa programme with a six-month acceleration phase. Startups
and internal projects benefit from free hosting in BizLabfacilities, have access to a large number of Airbus coaches
and experts in various domains, and participate in events suchas a Demo Day with Airbus decision makers, Airbus customers
and partners. The BizLab expanded its network by opening afourth campus, in Madrid, in January 2018.
Airbus Helicopters

CityAirbus is a three-to-four passenger optionally piloted electricvehicle for unmanned air mobility. It has transitioned into Airbus
Helicopters from the ExO and expects an unmanned ﬂ ight
test in 2018. The urban last mile delivery solution, Skyways,
plans a demonstration in February 2018, after which it will betransitioned into Airbus Defence and Space.

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1.1 Presentation of the Company

Airbus Defence and Space

Airbus Aerial is an image and data analytics services company
that was launched in 2017. It integrates data from a broad arrayof aerospace assets including satellites and unmanned aerial
vehicles. At the end of 2017, it employed 22 people.

c. Environmental Matters
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. This is done
through continually seeking to reduce the carbon intensityof Airbus’ industrial operations and working together with
Airbus’ suppliers, industry and government stakeholders in its
aim to ﬁ nd sustainable solutions to reduce the environmental
impact of its products, deliver its ambitious sectorial emission
reduction goals, as well as preparing adaptation to the effects
of climate change on its operations.
One of these challenges is the elimination of substances fromits products and processes that may pose a risk to humanhealth or the environment, which will be addressed later inthis section.

1. Environmental Management at Airbus“Shaping our future” means that Airbus develops products
and services taking into consideration current and foreseeable
future environmental challenges for future generations
and with long-term value creation in mind. Incorporating
environmental values into its core policy not only improves the
management of operational business risks and opportunities
but also enhances the long-term sustainability of its business.
Alongside the Company’s environmental policy in pursuit of
eco-efﬁ ciency, Airbus has developed an aspirational longterm ambition for 2050 setting the direction for the Company
regarding environmental matters, providing a framework to
set up concrete environmental objectives for the short- andmid-term.
The Company’s 2050 Ambition covers the three following
complementary directions:■operating Airbus sites without impact on climate change
by eliminating greenhouse gas emissions, with zero air andwater emissions, zero waste to landﬁ ll and minimal natural
resources consumption;■delivering products which provide maximised value tocustomers whilst meeting expectations of society throughminimised impact on climate, air emissions and noise,management of substances of concern aiming at theirelimination and maximised reliability, throughout the productlifecycle;■

engaging the supply chain in the Company’s ambitious
objectives.

In 2015, an Environment Steering Committee was created to
manage all matters related to the environment. The Steering
Committee meets four times a year and is composed of
the heads of Environment for Airbus Commercial Aircraft,
Helicopters and Defence and Space, as well as a representativefrom the R&S department. Its role is to develop and deﬁne theenvironmental policy and associated objectives and agree on
a common approach for the management of the environment
throughout the Company.
Airbus has put in place a robust Environmental Management
System (EMS) centrally and within its Divisions. One of thefunctions of the Airbus EMS is to track the enhancementof its environmental performance as it includes identifying,
managing, monitoring and controlling an organisation’senvironmental issues. Airbus’ EMS is guided by the latest
version of the international environmental standard, ISO 14001:
2015 version. The 2015 version has a broader scope thanprevious standards, and Airbus was among the ﬁrst aerospacecompanies to adopt it.
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.
On an annual basis, Airbus under takes an extensive
exercise to collect, consolidate and report the Company’senvironmental per formance data. Quantitative data isgathered – energy and water consumption, CO 2 and VOCemissions and waste generation – as well as qualitative data –certiﬁcation, incidents, activities on site. This enables Airbus tomeasure its environmental impact, follow its performance andcommunicate information on environmental matters to internaland external stakeholders. The Company’s commitment
to eco-efﬁ ciency is demonstrated through its transparent
reporting.
In the future, the reporting of environmental indicators will
include relevant categories of Scope 3 emissions for Airbus’
operations. This will provide greater understanding of the
impact on the environment of activities under Airbus’ control.
Working in Cooperation

Airbus understands the importance of working together withother stakeholders to ﬁ nd solutions.
Engagement within the International Aerospace Environmental
Group (IAEG). Airbus is a Founding Member of IAEG andparticipates in different areas of IAEG, such as greenhousegas emissions, substances management, substitution
technologies and supply chain to share practises and promote
development of global standards for implementation ofenvironmental requirements in the aerospace industry.

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Airbus is an active board member of the Air Transport
Action Group (ATAG) which sets goals and mobilises
action on strategic aviation issues such as climate change
through involvement throughout the industry (i.e. with othermanufacturers, airlines, airports, air trafﬁ c management).
Aviation is a global industry and requires global solutions.
ICAO, a specialised agency of the UN, has a proven trackrecord of delivering robust aviation environmental standards
and guidance (i.e. air quality, noise, CO 2). Airbus has showna long-term commitment to support the need for global civil
aviation governance, with ICAO as its corner-stone, working
together with stakeholders across the aviation industry andwith the relevant governmental agencies.
Airbus, with the rest of the aviation industry, has supported the
ICAO agreements in 2016 on the CO 2 standard and Carbon
Offsetting & Reduction Scheme for Aviation (CORSIA), the newinternational carbon offsetting scheme for aviation.
Airbus continues to proactively support emissions andnoise reduction once its aircraft go into service. This could
be through fuel efﬁ ciency services, weight saving projects,
retroﬁ ts (i.e. sharklets) and ground operations (i.e. eTaxi). In
2015, Airbus launched the Sustainable Aviation Engagement
Programme, establishing long-term cooperations with various
Airbus operators to offer ways to reduce their environmental
footprint.
Clean Sky was at the time of its launch the largest European
research programme funded by the EU, developing innovative,
cutting-edge technology aimed at reducing CO 2, gasemissions and noise levels produced by aircraft. As part ofthis programme, Airbus developed the Bluecopter concept,
which demonstrates a number of fuel saving and noise
reduction technologies. It is already the quietest helicopter
worldwide in its category, and also the ﬁ rst to reach thenoise category A+. The demonstrator underwent a stringent
ﬂight test campaign until April 2017 in order to validate theeffectiveness of the technologies developed in the frame of
the CleanSky programme.
In September 2017, the Company used a modiﬁed A340 aircraft
to test the laminar ﬂ ow concept developed by Clean Sky.
The BLADE project aims to reduce wing friction by 50% andreduce CO 2 emissions by up to 5%.

2. Environmental Concerns
Regulated substances across its products’ lifecycles

Aerospace manufacturing, operations and maintenance relyon certain regulated substances to achieve a high level ofquality, safety and reliability accounting for lengthy productlifecycles. Some of these substances are or may in the future
be classiﬁ ed as substances that may pose a risk to humanhealth or the environment. These type of risks depend on
many factors such as the category of classiﬁ cation, but also
the operational use of these substances under applicablelaws/regulations laying down occupational exposure limits,and the lifecycle stage of the products.

If a substance not yet identiﬁ ed is classiﬁ ed in the future as
one that may pose a risk to human health or the environment,
this may give rise to substantial costs for Airbus to manage it,
including, for example, research and development (whether
alone or in cooperation with other stakeholders) of suitable
alternatives, testing, qualiﬁ cation and certiﬁ cation costs. Any
reputational risk and potential claim against Airbus that may
result will also need to be managed.
Airbus continues in its activity (also in cooperation withindustry stakeholders) to identify new technologies andsolutions that avoid use of substances classiﬁ ed as posing
a risk to human health or the environment, whilst satisfying
airworthiness, certiﬁ cation 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
speciﬁ cities.
Airbus identiﬁ es, tracks and declares regulated substances.
The Company has already substituted certain substancesof concern or developed replacement technology where
suitable alternatives have been found, such as some ozonedepleting substances (ODS), ﬂuorinated gases, or substancesof very high concern (SVHCs) under the European regulation
REACH. On top of all applicable regulatory requirements,
more than 100 substances have been targeted by Airbus
for substitution and the Company is always looking for new
solutions. For example, Airbus Commercial Aircraft launched
the Airbus chromate free project in 2006. The project has so
far delivered substitution solutions for a considerable numberof usages and continues efforts to substitute the remaining
ones. One of the ﬁ rst steps was to deploy chromate-freesurface protection systems, with among others, operationalchanges and replacement within Airbus’ production lines.
Over 100 suppliers are now “qualiﬁ ed” to use chromate-free
pickling before anodisation.
Within IAEG, Airbus contributed to the creation of the IAEG
“Aerospace and Defence Declarable Substances List” (ADDSL) and the associated declaration standard (IPC-1754).
The AD-DSL provides an initial common list of chemicals/
substances identiﬁ ed and reviewed by IAEG as used within
the aerospace and defence supply chain and thus will makeit easier to work with regulatory agencies to appropriately
manage regulated substances and chemicals used in
manufacturing.
Surface modiﬁ cation by laser is a new technology developed
by Defence and Space to replace the use of substances forsome processes, notably for pre-treatment before bonding.
This technology is now available for some Space Systems
applications and is planned to be implemented into the serial
production of ﬂight hardware for New Generation Synthetic
Aperture Radar satellites (NGSAR).

REGISTRATION DOCUMENT 201757

Information on Airbus Activities
1.1 Presentation of the Company

Environmental impact of Airbus 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 reduction of Airbus’ environmental footprint on
air, soil and water quality, climate change, biodiversity andresource availability. An evaluation of hotspots is ongoing tohelp focus on appropriate topics.
Analysis of the current trends shows that the regulatory
pressure on the international scene to reduce theenvironmental footprint of the aerospace industry is steadily
growing (circular economy and resources ef ficiency,
energy transition and climate change engagement, air andwater quality improvement). In addition, the expectationsof stakeholders (including citizens, investors) are also
elements that increase pressure towards low carbon andsustainable production patterns. Since 2015, Airbus has
been developing its plan for the next decade to prepare forupcoming regulatory developments, maintaining employee
engagement and proposing solutions to stakeholders’expectations.
Airbus has committed and continues to commit to setting
up ambitious short-, mid- and long-term environmental
targets. In 2006, Airbus set up the environmental vision for2020 with goals for reduction of energy consumption, CO 2
emissions, water consumption, VOC emissions and waste
production. To fulfil its commitments, Airbus developed
innovative projects, continuous improvement mind-set andpractices sharing and participates in projects with otherstakeholders.

Airbus has also set an extended 2030 Vision, with operational
objectives on Airbus manufacturing activities but also
encompassing suppliers. Airbus wants to engage in ambitious
environmental objectives in its aim to:■enhance the use of environmental risk evaluation for
consideration as a quantitative input during supplierselection, contracting and auditing phases;■
divert waste from landﬁ lling and incineration;■comply with air emissions regulations and absorb ramp up
production impacts;■
comply with GHG emissions regulations (and compatible
with the global 2°C trajectory) and absorb ramp up
production energy impacts;■
develop strong maintenance and rehabilitation programs to
improve reliability and lower water costs.
To highlight the importance of CO 2 impact in design andoperation of plants, an initiative is being developed to set aninternal “Carbon Price” to be used in the trade-off between
different solutions. This may be used for industrial projects
and 2030 Vision would integrate a progressive increase in the
Carbon Price as a further carbon-reduction incentive and tobring greater appreciation of the CO 2 impact in the near future.
Airbus monitors and makes available data veriﬁed by external
auditors, and publishes transparently its industrial performance.
The performance linked to 2020 Vision results shows good
progress (by reference to a baseline of 2006 at constantrevenue and production) in different areas: energy consumption(stationary sources) has decreased by 37%, CO2 emissions by
42% (scope 1 stationary sources + scope 2 total), while water
consumption has been cut by 48% and waste by 41%.

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1.1 Presentation of the Company

Environmental data has been externally audited since 2010. Below is a selection of externally reviewed environmental indicators.
The current reporting covers Scope 1 and Scope 2 emissions.
Environmental
performance

GRI

KPI

Unit

2017

2016

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

MWh4,098,475

3,893,111

Energy consumption from stationary sources ✔

MWh1,357,724

1,395,192

of whichEN3

natural gas consumption

MWh1,298,639

1,335,263

distillate fuel oil consumption (Gas oil, Diesel, FOD)

MWh

13,782

12,170liquefied petroleum gas consumption

MWh

357

360

propane consumption

MWh

1,356

3,883

biomass consumption

MWh43,11743,517MWh

1,206,689

1,045,159

Energy consumption from mobile sources ✔
of which

Energygasoline consumption

MWh

2,749

2,769

distillate fuel oil consumption (Gas oil, Diesel, FOD)

MWh

26,02027,166liquefied petroleum gas consumption

MWh

5

118

propane consumption

MWh

1,736

1,700

jet fuel aircraft / kerosene consumption

MWh1,172,453

1,010,647■

flight tests

MWh687,071559,106■

BelugaMWh

485,382451,540

aviation gasoline consumption

MWh

3,448

2,760

Total electricity consumption ✔

MWh1,534,062

1,452,760

purchased electricity consumption

MWh1,405,920

1,371,842

purchased heat/steamMWh127,899

80,671

generated electricity from photovoltaic on-sitefor own use

MWh

242

247

generated electricity from other renewable source
on-site for own use

MWh

0

0

of which

EN4

Generated electricity from CHP on-site for own use ✔

MWh190,127

188,144

Total CO 2 emissions

tonnes CO2

1,013,101

935,402

Total direct CO 2 emissions (Scope 1) ✔

tonnes CO2

591,002557,447

CO 2 emissions from stationary sources

tonnes CO 2

265,350

272,679

CO 2 emissions from mobile sources

tonnes CO 2

311,036

269,493of which
EN16
Air emissions

EN20

CO 2 emissions from fugitive sources

tonnes CO2

14,57915,203

CO 2 emissions from processes on site

tonnes CO 2

37

72

Total indirect CO 2 emissions (Scope 2) ✔

tonnes CO2

422,099

377,955

Total VOC emissions*

tonnes

1,565

1,539

Total SOx emissions

tonnes15

15

Total NOx emissions

tonnes

314

241

REGISTRATION DOCUMENT 201759

Information on Airbus Activities
1.1 Presentation of the Company

Environmental
performance

GRI

KPI

Unit

2017

2016

EN8

Total water consumption ✔

m3

4,011,897

3,834,265

%

76,5%

76,4%

abstracted ground water

%

19,3%

20,0%

withdrawn surface water

%

4,0%

3,5%

of whichpurchased water
Water

rainwater collected used
EN21

Total water dischargeof which water discharged via an internal
pre-treatment plant

EN22

%

0,2%

0,1%

m3

3,416,506

3,464,179m3

214,200

228,428

tonnes105,839

104,505

non-hazardous waste

tonnes77,073

77,835

Total waste production, excluding exceptional waste ✔
of which

Waste

EN24

hazardous waste

tonnes

28,766

26,670waste going to material recovery

tonnes61,93362,344waste going to energy recovery

tonnes21,844

21,954

%

58,5%

59,7%

Material recovery rate ✔
Energy recovery rate
EMS certification

Number of sites with ISO 14001 /EMAS certification**
Percentage of workforce covered by ISO 14001& environmental reporting

%

20,6%

21,0%

unit

61

61

%

90%

86%

✔ Data audited by Ernst & Young et Associés. Limited assurance report is available on www.airbus.com
2017 data covers 89% of total Company employees.
2016 data correspond to the data validated by the external third party in 2016, without any recalculation to take into account perimeters movements, which can explain someof the observed variances.
* 2017 VOC emissions data is estimated. The consolidated 2017 data will only be available following publication of the Registration Document.
** Number of sites covered by the environmental reporting which are certified ISO 14001.
Only 100% consolidated entities are taken into account. The data here results from Airbus’ worldwide reporting campaign, carried out by the Environmental network. Airbus
environmental reporting includes all 100% consolidated companies with more than 50 employees, which represent 99% of Airbus’ total workforce. Among these companies,
90% had reporting contributors and tools. Note that some entities with less than 50 employees are taken into account in the reporting, as they are included in bigger entities
which report their environmental data.

Environmental Impact of its Products in Operation

In the last 50 years, the aviation industry has cut fuel burn and
CO 2 emissions per seat / kilometre by more than 80%, NO x
emissions by 90% and noise by 75%. Whilst this performanceis impressive, high predicted trafﬁc growth (5% per annum),aviation’s short to medium-term reliance on fossil-based fuels
and the potential impacts of non-CO 2 factors, the aviationindustry faces a signiﬁcant challenge in reducing its impact on
climate change.
To address the CO 2 challenge, Airbus, along with airlines,
airports, air trafﬁ c management and other manufacturers,
committed in 2008 to the ATAG CO2 emission goals:■
improve ﬂeet fuel efﬁciency of 1.5% per year by 2020;■stabilise: from 2020, net carbon emissions from aviation will
be capped through carbon neutral growth (CNG);■
by 2050, net aviation carbon emissions will be half of what
they were in 2005.

Meeting these goals will require a truly collaborative approachacross the industry, focused on a combination of improvement
measures including technology (including sustainable fuels),
operational improvements, infrastructure (including air trafﬁcmanagement) and global market based measures (MBMs).
Progress has been made on the ﬁrst two of ATAG emission
targets:■
by delivering aircraft such as the A350 XWB, 25% more efﬁcientthan the previous generation aircraft and the A320neo with-15% to -20% fuel burn compared to A320ceo, the averageincrease in global ﬂeet fuel efﬁciency has been over 2% perannum over the last ﬁve years;■
alongside reducing CO2 emissions, Airbus aircraft also offer
signiﬁcant improvements in both noise and NO x emissions
reduction: A350 XWB with up to 21 dB lower noise and 27%
lower NOx emission compared to current industry standards,
A320neo with up to 20dB lower noise and 50% lower NO x
emission compared to current industry standards. The new
H160 helicopter brings noise levels down by 50% compared
to previous generation helicopters;

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Information on Airbus Activities
1.1 Presentation of the Company■

the recently agreed ICAO CORSIA will also play an importantrole in achieving CNG from 2020.

For the ambitious long-term 2050 target, clearly Airbus andthe wider industry do not have all the answers today. Suchsigniﬁ cant reductions will require disruptive approaches intechnology (i.e. hybrid electric), signiﬁcant quantities of low
carbon fuels, innovative ways of operating the aircraft (eTaxi,
formation ﬂight) and sustainable ways to offset emissions.
In reaching this ambition Airbus is working on a wide range ofinnovative technologies that have the potential for signiﬁcantenvironmental beneﬁts:■
propulsion integration: from advanced turbofans to hybrid
distributed propulsion (i.e. electriﬁcation);■
aerodynamics: from advanced wingtip devices to natural andhybrid laminar ﬂow;■
structures: from innovative materials to bionic structures;■
systems & cabin: from paperless/wireless to more electricalsystems;■
operations: from noise to climate-optimised trajectories;■
manufacturing: from direct printing to 3-D printing;■aircraft conﬁguration: from integrated airplanes to disruptive
conﬁgurations.
Electriﬁcation and hybridisation can bring signiﬁcant beneﬁts
in addressing CO2, noise and NOx emissions. Airbus is drivinga step change in air vehicle performance, ﬁrst through small,short-range vertical take-off and landing (VTOL) urban air
mobility demonstrator projects like Vahana and CityAirbus. In
the longer term Airbus will also look at larger commercial aircraft.
Airbus’ engagement also extends to promoting thecommercialisation of sustainable aviation fuels. For example,
in order to make a step towards regular distribution of BioJet,
Airbus and Total are working in cooperation to use sustainable
fuels on ferry ﬂights from Toulouse to Hong Kong. A biofueldelivery platform has been set-up and is in service in Toulouse.
Recyclability and waste management are important topics that
Airbus is tackling in cooperation with other entities. With TARMAC
Aerosave, a joint venture between Airbus, SNECMA and Suez,
more than 90% of an aircraft weight is today recycled or reused 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
to determine the best processes and uses for recycled andreused carbon ﬁbre materials. Airbus is also investigating withcertain operators innovative solutions to improve the in-ﬂight
cabin waste management.

d. Responsible Defence and Space Products
Airbus works together with states, international organisations
and customers to create better defence solutions for a safer andmore prosperous world. Its military aircraft, Earth observation
satellites and security technologies help protect freedom anddemocratic values by enabling governments to guarantee
their sovereignty and combat changing terrorism threats andcybercrime.

It is one of Airbus’ aims to support the EU/NATO governmentsin their efforts to make the world a safer place. To fulﬁl their
mission to guarantee sovereignty, security and human rights,
these nations require equipment and defence systems that they
themselves deﬁne. Airbus supports the EU/NATO governments– which constitute the majority of Airbus’ customer base – inthis task by supplying the necessary equipment.
Airbus defence technologies can also be used to solve societal
challenges. More ways are being explored for observation orcommunication satellites to contribute to solving some global
challenges such as climate change, fast and reliable internet
connection or security. Recent projects include:■
Sentinel-5 Precursor, which is part of the joint European
Commission–European Space Agency global monitoring
programme Copernicus, aims to acquire continuous andaccurate Earth observation data and provide services toimprove the management of the environment, understandand mitigate the effects of climate change, and ensure civil
security;■
Spationav is the coastal protection project of Signalis France,
ensuring maritime security in France. Its mission is to protect
human life, the coastal environment and French national
interests while covering 6,000 kilometres of coastline with5,000 ships tracked each minute. Spationav is counteracting
illegal activities such as smuggling and terrorism;■
the Global Earth Observation Challenge organised by Defence
and Space rewarded in October 2017, six start-ups that
innovate and develop new applications primarily based on
Airbus’ satellite data. Among them, two projects were linked
to monitor environmental impacts: Ozius (Australia) creates
new landscape intelligence by fusing a variety of remotesensing data to identify where the environmental risks andopportunities occurred in the past, where they are today, andproject where they will occur in the future; Kermap (France)
uses satellite imagery to support the ecological transition of
cities;■TeSeR is the next EU project to clean up space, which is led
by Airbus. Technology for Self-Removal of Spacecraft (TeSeR)
aims to reduce the risk of spacecraft colliding with debrisin space and provide a sustainable space environment for
future generations;■
the OneWeb Satellites JV is building a communications
network with a constellation of low Earth orbit (LEO) satellites,with a goal of enabling access to billions of people around theworld. With more than 7 terabits per second of new capacity, itaims to transparently extend the networks of mobile operators
and ISP’s to serve new coverage areas, bringing voice anddata access to consumers, businesses, schools, healthcare
institutions and other end users.
Finally, the Airbus Foundation, which will be discussed later in thischapter, is multiplying partnerships in order to leverage Airbus’
know-how and technologies to be applied to the humanitarian
sector, with UAVs, satellite imagery and decontamination
projects in particular.

REGISTRATION DOCUMENT 201761

Information on Airbus Activities
1.1 Presentation of the Company

1.1.8.3

Responsible Employer

a. Airbus’ Workforce
As of 31 December 2017, Airbus’ workforce amounted to129,442 employees (compared to 133,782 employees in 2016),
95.8% of which consisted of full-time employees. These statistics
take into account consolidation effects and perimeter changes
throughout 2017. Depending on country and hierarchy level, theaverage working time is between 35 and 40 hours per week.
In 2017, 7,318 employees worldwide were welcomed into Airbus(compared to 7,532 in 2016 and 5,266 in 2015). At the sametime, 5,151 employees left Airbus including partial retirements(compared to 4,698 in 2016 and 4,870 in 2015).
Employees by Division

In terms of nationalities, 37.3% of Airbus’ employees are from
France, 32.1% from Germany, 9.4% from the UK and 9.8%
from Spain. US nationals account for 1.9% of employees. The
remaining 9.6% are employees coming from a total of 127 othercountries. In total, 92.1% of Airbus’ active workforce is locatedin Europe on more than 100 sites.

Workforce by Division and Geographic Area
The tables below provide a breakdown of Airbus’ employees
by Division and geographic area, as well as by age, including
the percentage of part-time employees.

31 December 201731 December 2016

Airbus Commercial Aircraft ✔

74,54273,852

72,816

Airbus Helicopters ✔

20,161

22,50722,520Airbus Defence and Space ✔

32,171

34,397

38,206

Airbus former HQ(1) ✔

2,568

3,026

3,032

129,442

133,782

136,574

31 December 201731 December 201631 December 2015

Group Total ✔

31 December 2015

(1) “Airbus former HQ” includes Headquarters, Shared Services and Innovation Works.

Employees by geographic area
France ✔

47,86547,96350,810Germany ✔

44,21446,71347,796

Spain ✔

13,177

12,682

12,521UK ✔

11,304

12,02012,157

US ✔

2,707

2,829

2,821

Other Countries ✔

10,175

11,575

10,469Group Total ✔

129,442

133,782

136,574

31 December 201731 December 201631 December 2015

4.2%

4.1%

3.9%

31 December 201731 December 201631 December 2015

126,534

131,153

133,650

2,908

2,629

2,924

% Part time employees

Group Total ✔

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

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62Registration Document 2017 - AIRBUS
Information on Airbus Activities
1.1 Presentation of the Company% Active Workforce by Age

31 December 201731 December 201631 December 2015

<20 ✔

0.1%

0.2%

0.2%

20-29 ✔

10.1%

10.4%

10.6%

30-39 ✔

29.4%

29.5%

29.7%

40-49 ✔

28.4%

27.9%

27.9%

50-59 ✔

26.8%

27.1%

27.1%

60+ ✔

5.1%

4.9%

4.6%

31 December 201731 December 201631 December 2015

4.0%

3.6%

3.6%

Employee Turnover Rate* ✔

✔ Data audited by Ernst & Young et Associés. Limited assurance report is available on www.airbus.com.
* The turnover rate does not include departures of the non-active workers.

Airbus’ headcount reporting includes all consolidated companies
worldwide. The internationally comparative ﬁgures are based on
the active workforce, i.e. the number of permanent and shortterm employees, irrespective of their individual working times.
The headcount is calculated according to the consolidation
quota of the respective companies.
The scope for Human Resource (HR) structure reporting covers
about 97% of Airbus’ consolidated companies, including all
employees of these companies, irrespective of their individual
consolidation quota (except for the part time employee indicator
where coverage is 96%). This includes employees working for
the Company or its subsidiaries in France, Germany, Spain,
Great Britain and internationally. In total, about 3% of thecompanies belonging to Airbus – usually recently acquired –are not included in the scope, as no detailed employee data isavailable at Group level. The coverage rate is calculated on thebasis of the number of employees (active work force).
For more details on Scope and Methodology, please refer tothe Airbus website at http://www.airbus.com.

b. Human Capital Management,
Labour Relations and Human Rights
Airbus’ workforce is managed by the HR function thanks to aset 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 Airbus’ 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 Airbus and contribute to a common
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.
HR places people at the heart of Airbus’ future success.

Labour Relations
Wherever it operates, Airbus 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 compliancewith the Airbus Standards of Business Conduct and with theInternational Framework Agreement signed in 2005.
In the International Framework Agreement, Airbus 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 respect and ensuring
the conditions for industrial dialogue.
Airbus in particular intends, via its agreements, to respect
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 (minimumage), 87 (freedom of association and protection of the right toorganise) 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 employees of Airbus will be informed, either orally or inwriting, of all the provisions of this framework agreement, in
accordance with the relevant legal form and/or local practice.
The provisions of this framework agreement deﬁ ne Airbus’
standards to be applied wherever Airbus operates, insofar as
more favourable conditions do not exist already. Airbus central
management shall take appropriate measures to eliminate any
breach of the aforesaid principles.
Airbus 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 andREGISTRATION DOCUMENT 2017

63

Information on Airbus Activities
1.1 Presentation of the Company

negotiations 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
and local legislation thanks to Airbus’ Societa Europea WorkCouncil (SEWC) agreement in 2015. In 2016, for example,
Airbus organised 16 meetings with SEWC while the agreement
stipulates three mandatory meetings per year.

Human Rights
Airbus has a zero tolerance approach to modern slavery within
its business, its operations and within its supply chain.

Airbus is committed to promote awareness through internal
communication initiatives and awareness sessions and to train
its employees worldwide on potential risks. Related risks will
now be monitored via the Airbus ERM process throughout theentire Company. Finally, subject to regulatory approval, Airbus
intends to extend its existing OpenLine to concerns related tohuman rights and fundamental freedom.
Airbus acknowledges its role in promoting responsible businesspractices worldwide. To that end Airbus now seeks to identify
risks related to human rights violations in its ERM system. Risk
evaluation will start in 2018. KPIs as part of Airbus’ commitments
related to the UK Modern Slavery Act will be identiﬁed in 2018.
Human rights is also a topic addressed in the Airbus Supplier
R&S Programme.

2017 Achievements
In 2017, Airbus provided more than 1.7 million training hours. Moreover, in 2017 more than 42,000 employees beneﬁtted from thedevelopment, evaluation 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 and human transformation in Airbus.

Total number of Training Hours
Total number of Training Participants

2017

2016

2015

*

2,320,508

2,264,145*

214,819

226,692

Number of Classroom Training**

161,419***--

Number of Digital Learning**

193,200***--* Change of reporting in 2017, no numbers reported for 2017.
** New reporting scope since 2017. 51.7% digital learning in the 2017 learning plan (Active Workforce from fully-consolidated entities at 31 December 2017).
*** These figures include training sessions provided by Airbus, including to externals, to employees in subsidiaries, and to employees that have since left the Group.

On a more restrictive HR perimeter (Active Workforce from fullyconsolidated entities at 31 December 2017), the number oftraining sessions are the following:■number of classroom training: 134,427 ✔
■number of digital learning: 144,624 ✔

At Airbus recognition of excellence is key. In 2017, over 1,000
projects were submitted company-wide to participate in theAwards for Excellence scheme. The aim is to reward employees
and teams for exceptional achievements, their ways of working
and their contribution to improving business performance.

Mobility of employees within or across Divisions is one of themain priorities for the overall beneﬁt of the Company. In 2017,
more than 11,000 employees changed jobs cross-divisionally andcross-country. For reference, Airbus has an attrition rate of 2.7%
for its core entities and 4.0% when its subsidiaries are included.

Airbus additionally launched its ﬁ rst Dream Big Challenge,
inviting employees to propose new products, business andservices ideas. Over 700 ideas were submitted in 2017. Following
a summit held in November, the three most promising projects
were selected to be developed further in incubators and during
dedicated worldwide learning expeditions to Airbus’ BizLabs.

In order to drive its digital transformation, Airbus aims to createa people-centric and trusting working environment. Launched at
the end of 2015, a company transformation programme called
PULSE has been designed to support the people aspectsof the business transformation with the objective to increase
empowerment, accountability and collaboration throughdigitally-powered capabilities, reworked HR policies and new
ways of working.
In 2017, all Airbus employees were invited to select theCompany’s values. This inclusive consultation exercise included
employees from 17 countries. Around 55,000 employees took
part in this campaign and deﬁ ned the Company’s six corevalues: Integrity, “We are One/Team work!”, Customer focus,
Creativity, Respect and Reliability.

c. Health & Safety
To sustain its commercial success, attract the best talent andbe known as a safe and healthy workplace, it is Airbus policy tocontinuously reinforce health and safety as part of the businessculture, delivering responsible health and safety managementthat sustainably reduces risk to people, the environment andthe business. The purpose of the Airbus health and safety policy
is to:■
demonstrate commitment to good management control of
health and safety;■
describe the guiding principles for health and safety
management;✔ Data audited by Ernst & Young et Associés. Limited assurance report is available on www.airbus.com

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integrate health and safety into company culture, strategy,
processes, objectives, and decisions;■
engender the harmonisation of health and safety philosophy
and methodology, to gain risk control and efﬁciency beneﬁts;■
stimulate the sustained reduction of work related health andsafety risks, in order to protect people and the Company.
■

To achieve its policy objective, Airbus is consolidating health andsafety resources into a companywide organisation in order todrive effective, efﬁcient risk control. This approach is designed todeliver companywide harmonisation of philosophy and method,with proactive risk assessment and control, role-appropriatecompetence and development, and active monitoring, analysis
and oversight reporting.
Airbus consults employee representatives, for example indirect meetings and committees, and conducts a range ofcommunication campaigns, thereby encouraging all employees
to engage in health and safety risk management. Airbus’
industrial managers are closely involved in the performancemonitoring process, for example conducting formal “go-looksee” safety tours. All reported incidents are appropriately
investigated, using root cause methodology where necessary.
Signiﬁcant incidents and the results of monitoring are discussed
by industrial management teams in the regular “Safety,
Quality, Cost, Delivery, People” management system or similar
processes.
However, health and safety is not only a compliance matter;
Airbus strives to improve even further, and so is introducing
a formal corporate management framework based on the
coming ISO 45001 Standard, which is supported by a common
companywide health, safety and environment software
platform. This software toolkit, called FISH, will start to be
deployed in 2018, and will enhance its Occupational Health,Risk Management and Incident Management capability.
Health and safety concerns caused by work activities include
the possibility of injury, physical and mental ill-health, businessinterruption and regulatory action. Any reputational risk and claim
against Airbus that may result will also need to be managed.
Data indicates that main causes of injury are slip, trip and fall
events and manual handling. Work at height and chemicals
present additional concerns. The Company manages risks
by applying risk assessment and control processes, enabling
continuous risk control improvement.
To support its risk management activities, Airbus has morethan 300 courses dedicated to health and safety available
in its training catalogue, addressing a wide range of topics
including, for example, working at height, ﬁrst aid, managementof substances and materials and psychosocial risk. In 2016 theCompany delivered over 260,000 hours of dedicated healthand safety training to more than 42,000 individual employees.
In 2017, the Company has delivered about 200,000 hours of
training to approximately 40,000 participants. In addition, there
are over 100 digital health and safety reference courses, which
employees can take at any time.

Airbus has health and safety processes for on-site subcontracting
and intends to further adapt and develop such processes.
Airbus prepares prevention plans in order to identify potential
risks and deﬁne prevention measures in cooperation with on-site
subcontractors, and monitors on-site subcontracting activities.
The health and safety improvement plan includes initiatives
to review Airbus’ Health and Safety Policy which applies
companywide including to afﬁliates. The corporate health andsafety management system is being developed in accordancewith the principles of the new ISO 45001 framework. This
work will include deﬁning maturity indices and performanceindicators.
In order to continuously improve the management of risks, work
includes project FISH (the conﬁguration and implementation ofa global software platform for health, safety and environmental
topics). This will enable the aggregation and analysis of healthand safety data to form a risk topography that focuses resources
to best effect. It is expected that this project will be completed
in 2019. Thus, Airbus intends to report on its health and safety
KPI’s in the coming years’ management reports.

d. Inclusion & Diversity
Airbus 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. But the demographics of theworld are changing, and this change impacts Airbus because it
affects customers, suppliers, employees and Airbus’ candidate
pool. Airbus must face the 21st century’s challenges with
21st century people and solutions.
Airbus’ approach to Inclusion & Diversity (“I&D”) takes different
forms including: I&D Steering Board chaired by 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 isembedded in all it does, serves business purposes and beneﬁts
all employees worldwide. With full support of the entire HR
function, I&D initiatives are run and coordinated by a dedicatedteam 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, Airbus
is working to increase the number of applications from areasthat are currently under-represented in its workforce, including
but not limited to women, nationalities, age groups and social
backgrounds to ensure a broader range of candidates for open
positions.

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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, UK) through an
International Graduate Programme enabling talents from allaround 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 Airbus welcomes many forms of diversity, it measuresthe evolution of the diversity of its workforce with a 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 women among white collar
external hires, gender pay gap (if any) at all levels between

women and men, and the number of moves from the key
countries (including India, China, US) to the home countries.
Airbus has launched several actions to embrace other formsof 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.
Finally, Airbus offers a wide scope of trainings supportingI&D initiatives and has also embedded a diversity aspect inleadership programmes.
As far as the Airbus Board of Directors is concerned, Airbus ismoving in the right direction with 3 women in 2017 compared
to not a single woman on the Board in 2013. They are Catherine
Guillouard, Claudia Nemat, María Amparo Moraleda Martínez.
For a description of the diversity policy of the Airbus Board of
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 201731 December 201631 December 2015

Women in active workforce ✔

17.5%

17.2%

17.2%

Women in management positions ✔

12.4%

11.4%

10.9%

The% of women in management positions only applies to the top 4% of the active workforce.

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.
In 2017, Ethics and Compliance was a top priority for Airbus.
In its list of priorities for the year, Airbus set the objective to:“Engage and develop our people worldwide to excel today andtomorrow by adopting key digital skills and mind-set, reinforced
ethics & compliance adherence and a strong focus on diversity”.
Airbus also announced the appointment of an Independent
Compliance Review Panel (ICPR) composed of eminent external
consultants to help Airbus further improve its processes. The
ICRP members are Lord Gold from the UK, Noëlle Lenoir from
France and Theo Waigel from Germany. All well-versed incompliance monitoring of large corporations, they will haveaccess to all levels of the Company and will report to the Airbus
CEO and Board on how to further improve Airbus’ compliance
processes, policies, organisation and culture.

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). For
further information on the investigations, see “— 1.1.7 Legal andArbitration Proceedings”.

Our Commitment
Over the years, Airbus 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, Airbus supports the principles of the
UN Global Compact and IFBEC’s Global Principles of Business
Ethics which set a benchmark for high ethical 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.

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

respect and comply with each of these controls. The Export
Compliance Directive defines its policies, processes andorganisation to ensure compliance with all relevant export
control laws and regulations.

Data Protection Compliance
Our Programme
While the Standards of Business Conduct provide a usefulstarting point, they cannot answer all questions, nor are they
sufﬁcient to ensure that Airbus 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 around four key risk
areas: Business Ethics/Anti-Corruption Compliance, Export
Compliance, Data Protection Compliance and Procurement
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.
Improving the programme is a constant and ongoing process,not only in the area of Business Ethics/Anti-Corruption but
across the ethics and compliance spectrum more generally inorder to capitalise on our values.

Business Ethics/Anti-Corruption Compliance
Airbus rejects corruption of any kind, whether public or private,active or passive. This means that neither Airbus, its employeesor third parties acting on its behalf may offer, promise, give,
solicit or receive – directly or indirectly – money or anything ofvalue to or from a government ofﬁcial or someone in the private
sector in order to obtain or retain business or secure some otherimproper advantage.
The Anti-Corruption Policy (available at http://company.airbus.
com/dam/assets/airbusgroup/int/en/group-vision/ethicscompliance/documents/Airbus-Group-Anti-CorruptionPolicy.pdf) summarises its stance of zero tolerance. It also
refers to some of the speciﬁc directives Airbus has adopted toaddress key anti-corruption risk areas, such as the engagementof third parties, gifts and hospitality exchange and the makingof sponsorships and donations.
More broadly, Business Ethics at Airbus also covers otherareas such as conﬂicts of interest, anti-competitive conduct,
insider trading, fraud, etc., while also complementing the Airbus
Corporate Social Responsibility programme which focuses on
managing the social and environmental impacts of Airbus’s
operations.

Export Compliance
Each of the countries in which Airbus does business has controlson the export and transfer of its goods and technologies thatare considered to be important to national security and foreign
policies. As a global enterprise, it is Airbus’ responsibility to

Airbus is required to handle personal data in accordancewith applicable data privacy laws at national, European andinternational level. In doing so, Airbus seeks to apply a consistent
approach, by setting data security standards for personal dataprocessing in line with global best practice. This is embodied inpart by its Binding Corporate Rules (available at http://company.
airbus.com/dam/assets/airbusgroup/int/en/group-vision/
ethics-compliance/documents/Airbus-Group-BCR-/Airbus%20
Group%20BCR%20.pdf), which provide a consistent level ofprotection for various personal data throughout Airbus.

Procurement Compliance
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 (available at
http://company.airbus.com/dam/assets/airbusgroup/int/en/
group-vision/ethics-compliance/documents/Supplier-Code-ofConduct/Supplier%20Code%20of%20Conduct.pdf). Suppliers
are also expected to cascade these principles through theirown supply chain. For further information see “— Responsible
Suppliers” below.

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 qualiﬁed
compliance ofﬁcers who ensure the compliance programme isimplemented in the different functional and operational 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.

New and Updated Policies
In January 2017, Airbus published a directive deﬁ ning therequirements for sponsorships, donations and memberships.
The directive establishes a Company-wide framework andprovides guiding principles and clear instructions on how torequest, approve and record contributions.
In February 2017, Airbus published a directive deﬁ ning therequirements for the prevention of corruption in the engagementof lobbyists and special advisors. The purpose of the directive
is to ensure that Airbus’ political engagement through lobbyists
or special advisors remains fully transparent and ethical, andfacilitates Airbus’ compliance with all applicable laws.

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In June 2017, an updated version of the Airbus Standardsof Business Conduct was published, to comply with therequirements of France’s new Sapin II law. The updated version
deﬁ nes both bribery and inﬂ uence peddling, and provides
illustrations of each. Changes were also made to cross-refer tothe Airbus Anti-Corruption Policy, and to include a new section
on Anti-Money Laundering.
In June 2017, an updated version of the Airbus OpenLine Policy
was also published, to enhance the provisions to protect thewhistleblower from retaliation in line with Sapin II.
In September 2017, Airbus published its revised Business
Development Support Initiative Directive (BDSI). The directive
deﬁnes the Airbus requirements for the prevention of corruption
in the engagement of BDSI third parties. It provides employeeswith step-by-step explanation of the due diligence, engagement,
remuneration and monitoring of BDSI third parties.
In October 2017, Airbus published a directive deﬁ ning therequirements for identifying and mitigating corruption risks inconnection with M&A, JV and similar transactions. This directive
is intended to help ensure a consistent approach to thesematters across Airbus.

Our Awareness and Training
Airbus 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 2017, Airbus conducted 84,273 Ethics & Compliance digitaltraining sessions.

Our Confidential Speak-Up Channel: OpenLine
Airbus recognises that the Standards of Business Conduct
cannot address every challenging situation that may arise.
Airbus therefore encourages its employees to speak-up
through various channels, including through OpenLine(https://www.airbusopenline.com/). The OpenLine enables
employees to conﬁdentially raise their concerns via the internet
or by phone. Subject to local legal restrictions, the OpenLine
alert system has been available for several years to employees
in France, Germany, Spain, UK, Canada, Brazil, Australia andthe US. In 2014, it was made available to employees in Mexico,
China and Saudi Arabia. Airbus does not tolerate retaliation
against employees making reports in good faith and/or assisting
in investigations of suspected violations of the Standards ofBusiness Conduct. For further information on the OpenLine
please refer to the Airbus Group OpenLine Policy (available
at https://www.airbusopenline.com/PoliciesAndNotices).
Employees, customers, suppliers and third-party intermediaries
are encouraged to share their concerns with management orwith Ethics & Compliance resources.

b. Responsible Suppliers
Airbus designs and integrates complex aerospace and defence
products, leveraging an extensive supply chain. Co-operation
with suppliers occurs in several ﬁelds of the business and is
key to ensure quality standards which lead to shared success,growth through innovation and a commitment to sustainability.
Airbus also engages its suppliers on its sustainability journeyand shares a commitment to improve social and environmental
performance, constantly driven by values of integrity andtransparency.

1. Procurement at Airbus
More than 15,000 suppliers from more than 100 countries supply
parts, components or sub-systems to Airbus. In 2016, Airbus
spent around € 49 billion with its suppliers. The Procurement
function is improving its performance through creating a more
integrated, effective and lean organisation. It aims at increasing
harmonisation of internal and supplier-related processes, job
proﬁles, training processes and tools.
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.

2. Responsible Supplier Management
As a global leader in aeronautics and space, Airbus has taken
a commitment to conduct its business responsibly and withintegrity. Taking into consideration the level of outsourcing at
Airbus, the supply chain is an integral part of Airbus’ ecosystemand the Company is therefore committed to ensure that, as
far as possible within its own scope of responsibility and legal
obligations, potential adverse impacts of Airbus activities aremanaged. The Procurement function is ISO 14001 certiﬁed aspart of the global Airbus environmental certiﬁcation.
The Airbus Supplier Code of Conduct is the document ofreference for Airbus’ responsible supplier management. This
Code represents the group-wide values and principles in linewith internationally recognised standards and conventions (suchas OECD and ILO). It has been developed with the International
Forum on Business Ethical Conduct (IFBEC) in 2015 in the formof a Model Supplier Code of Conduct. Airbus is proud to be a
co-founder of IFBEC, which supports the application of global
standards for business ethics and compliance in the aerospaceand defence industries. Airbus implemented the IFBEC Model
Supplier Code of Conduct in its entirety as the Airbus Supplier
Code of Conduct in 2016.

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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 to comply with the key values set out in this Codeand to conduct business in accordance with all applicablelaws and regulations of their operating markets, the countries
in which operations are managed, or services provided.
Suppliers are also expected to cascade these principles
throughout their own supply chains.
Supplier Quality Audits and Supplier Mapping

Supplier audits and assessments support the goal of ensuringthat supplier deliveries meet Airbus’ speciﬁ c requirements.
Suppliers whose activities impact the airworthiness of Airbus
products are assessed annually, with ﬁve areas of performance
evaluated: quality, logistics, customer support, commercial
performance and technical performance. Around 1,000 audits
and assessments have been performed in 2016 for Airbus’commercial aircraft business.
As part of supplier management activities in the field ofquality, Airbus Commercial Aircraft has put in place, theSupplier Mapping tool with multiple capabilities, notably
to identif y Airbus supply chain sub-tiers and suppor t
identification of risks of supplier non-performance. In 2016,a total of 6,904 suppliers from 58 countries were identified
by the Supplier Mapping tool of which 1,007 were tier-one
suppliers, 5,452 second tier suppliers, 445 other tier levels.
A total of 97,537 activities were involved and 40 quality
alerts resulted from 550 analyses and reports. The alerts
were managed internally by the Procurement supply chain
management department.
Ethics & Compliance Supplier Watchtower

The Ethics & Compliance Supplier Watchtower is managed by
the Procurement Compliance department proactively checking
speciﬁc suppliers for compliance aspects.
Suppliers are checked depending on the risks linked totheir country of registration. The risk rating of countries isdeﬁ ned 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 andsubsidiaries). In case a Supplier Integrity Check yields
concerns, a Procurement management meeting is held todiscuss potential additional due diligence measures andmitigation actions. About 700 Supplier Integrity Checks wereconducted in 2017 (about 600 in 2016).

A Supplier Integrity Check can be performed on demand andis also embedded in the supplier registration process andeProc, an electronic platform where buyers and suppliers
perform all aspects of calls for tender, from identiﬁcation ofpotential suppliers, contract awarding, to supplier evaluationand spend analysis.
Environment, Health and Safety in the Supply Chain

Identiﬁ cation of potential risks related to legal and regulatory
requirements that may be applicable to Airbus’ managementof compliance of its activities and products and thecommunication of information on the composition of its
products depends on the level of information made available
by the supply chain.
Airbus Procurement is continuously striving to improve theintegration of environmental, health and safety elements into
the purchasing process.
Current standard procurement contracts include requirements
for suppliers to comply with all applicable laws and regulations
regarding production, products and services and 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
to enable safe use, for management of the product acrossits lifecycle (including waste management). Suppliers are also
requested to implement an Environmental Management System
which shall consider continuous improvement through the
mitigation of signiﬁcant environmental aspects and impacts,
including air emissions (e.g., Greenhouse Gas, Volatile
Organic Compounds); waste, water discharges, raw material
consumption.
Regarding supplier environmental control and monitoring,
Airbus performs the following activities: collecting datafrom suppliers is made through a Material Declaration Formto enable Airbus to identify which substances are used,
tracking and declaring them in the frame of substances
regulation such as REACH. Environmental requirements
are included in supplier audits and the Industrial Process
Control Assessment (IPCA). In addition, the Environmental
Obsolescence Risk at Supplier (EORS) assesses the levelof maturity of supplier processes for management of Airbus
environmental requirements and regulated substances
obsolescence management processes. EORS are applicable
to all Airbus Commercial Aircraft suppliers – EORS campaigns
have targeted the supplier of cabin, systems and equipment,
engines and nacelles products.
The Procurement function is ISO 14001 certiﬁed as part of the
global Airbus environmental certiﬁcation.

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Zero Tolerance Approach to Modern Slavery in Supply
Chain

3. Moving forward: Airbus Supplier R&S Compliance
Programme: Vigilance Plan

Airbus has a zero tolerance approach to modern slavery
within its business, its operations and within its supply chain.
In June 2017, Airbus published its ﬁrst public statement on
modern slavery as per the requirements of the UK Modern
Slavery Act 2015.

To deliver parts, components, sub-systems or services, quality,
reliability and economic efﬁ ciency 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.

Recognising that modern slavery could occur in all areas ofits value chain, Airbus has set up a Modern Slavery SteeringGroup within its UK business. The remit of this cross-functionalgroup is to support and drive Airbus’ approach to reducing
the risk of modern slavery in its supply chain, and ensure thatpolicy decisions and activities are coordinated, well led andeffective.
The Airbus Supplier Code of Conduct includes the requirement
to adhere to regulations prohibiting human trafﬁcking and forced
or indentured labour. In 2016 and 2017, Airbus held awarenesssessions with key people working in its UK Procurement teams
on modern slavery. Those sessions included information,
guidance and advice on identifying potential risks in the supply
chain. More in-depth training sessions took place in 2017 toinclude key teams in high risk areas, along with on-line training,
information bulletins and news articles bringing this important
subject to the attention of the wider workforce.
The Airbus “Procurement Academy” provides training on corecompetences and skills to develop procurement expertise.
The Academy has introduced a complete set of common
training solutions, covering the full range of supply chain
topics, including an external qualiﬁcation. Additionally, training
is offered to suppliers around the world. The Procurement
Academy also develops innovative development solutions to
prepare Procurement employees to future challenges such as
talent development programme, shaping the jobs of the future
and connect with the Procurement community on end to end
activities.
Promoting Disability Friendly Companies

Since 2011, Airbus in France has been promoting employment of
disabled people by its suppliers. Concretely, a speciﬁc mention
is integrated into all relevant calls for tender launched, requestingbidding suppliers to propose a partnership with a disability
friendly company.
At the end of 2016, the global volume of business withdisability friendly companies in France was € 37 million withan increase of 30% compared to 2015 for the whole of Airbus
in France. 51 disability friendly companies are working with
Airbus compared to 10 in 2010. An extension of this projectto Airbus sites in Spain and Germany is planned based on
the same philosophy: create jobs for people with disabilities
in specialised companies.

Airbus strives to make sustainability a core element of its
procurement process. Airbus has a long established andintegrity-driven procurement process which manages
relationship with suppliers from strategy, supplier selection,
contract management to supplier management. Environmental
activities in Procurement have paved the way to integration ofwider corporate social activities within the supply chain.
Willing to encourage development of responsible suppliers andmanage the potential adverse impacts of its activities as well as
to create new opportunities, in 2017 Airbus launched a Supplier
R&S Compliance Programme, following international guidancesuch as the OECD guidance on responsible business conduct.
The programme has also been designed to increase supplierawareness in these areas to facilitate suppliers’ compliancewith applicable regulations requiring risk identiﬁ cation andmanagement related to corporate social responsibility (CSR)
including environment, health and safety, human rights andanti-corruption matters.
The Supplier R&S Compliance Programme initiated anddefined in 2017 will continue and evolve year on year on
the principle of continuous improvement. The Supplier R&S
Compliance Programme has been presented to and reviewed
by the Procurement Executive Team led by the Airbus Chief
Procurement Ofﬁcer.
The Supplier R&S Compliance Programme and its activities
are managed by the Airbus Procurement Compliancedepartment, together with relevant Airbus Procurement
stakeholders. To this end, the existing Airbus Procurement
environmental network with representatives from the different
Procurement categories of purchase has been extended tocover other CSR-related topics. The aim of this network is toensure that the entire Airbus Procurement community is madeaware of CSR-related topics and support the identiﬁ cationof risks according to the category of purchase. The Airbus
Procurement R&S network can also support initiating
cooperation with suppliers as well promoting industryrecognised practices. Additional governance exists with the
R&S, Legal and Ethics & Compliance departments.

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1.1 Presentation of the Company

The Supplier R&S Compliance Programme is based on four
key elements:
A. CSR-related risk identification and evaluation

All Procurement related risks are embedded into the Company’s
ERM system. A speciﬁc risk category regarding CSR-relatedrisks 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 andreporting of CSR-related risks, a proactive supplier risk mapping
is being performed in line with international guidance. Suchrisk mapping results from both a country and a purchasing
category approach. The CSR-related risks levels per categoryof purchase have been analysed and reviewed with the relevant
Procurement commodities.
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 will continue to be implemented in 2018.
Such mitigation actions currently include the performance ofSupplier Integrity Checks (see previously mentioned part on
Ethics & Compliance Supplier Watchtower). New mitigation
actions such as supplier evaluation will be implemented following
a period of trial phase.
B. R&S in supplier selection and contracting

For the last few years, Procurement standard contracts have
evolved to include clauses requiring suppliers to comply with allapplicable laws and regulations as well as clauses on speciﬁc
topics such as environment. In 2018, a more detailed clause on
anti-corruption will be incorporated into procurement contract
templates to further specify Airbus’ requirements in this domain.
Furthermore, Airbus is currently evaluating how to reinforce
CSR-related requirements such as those on Human Rights,
along the selection and contracting phase with suppliers.
During the call for tender phase, results of the CSR-related risk
assessment will be used to require further supplier evaluation
if deemed necessary.
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. Supplier evaluation and continuous improvement

Supplier CSR-related evaluation assesses the compliance of
suppliers with Airbus requirements in these ﬁelds and allows theidentiﬁcation and integration into Airbus requirements of potential
supplier improvement actions. Airbus is currently deﬁning theoptions for supplier CSR-related evaluation and audits and how
to integrate these activities to existing supplier assessment
activities, such as supplier self-evaluation, desktop review oronsite audits. Airbus is also exploring potential solutions forthe wider aerospace and defence sector via its participation tosector national associations. Once deﬁned and approved, a trial

phase will be performed with speciﬁc sample of suppliers. Clear
guidance on how to manage audit results will be integrated into
the relevant Procurement processes.
From 2018 onwards, Airbus will strive to implement the above
four elements, deploying corresponding targets for each ofthem. The programme is integrated into Airbus’ Procurement
strategy and is discussed and reviewed by a Steering Committee
composed of the Executive Committee of Procurement.
D. R&S in the Procurement process

Airbus is currently assessing all Procurement processes andtools in order to integrate CSR-related requirements where
relevant. This will lead in 2018 to the adaptation of Procurement
process documentation managed by the Procurement strategy
teams. Key documentation such as the Airbus Supplier Codeof Conduct or Supplier Integrity Check application will beembedded into the Procurement tools, such as eProc.

c. Local Socio-Economic Footprint
Airbus 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. Airbus is a truly global company
that acts local. Airbus’ approach to community engagement isdriven by the willingness to develop a win-win cooperation withthe local eco-system and often materialises through partnerships
with local NGOs, institutions and other companies.

Local Involvement
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, Airbus can bring positive contributions to local
communities around its sites. Airbus’ directive on sponsorships,
donations and memberships provides a Company-wide
framework to ensure its local actions are aligned with global
strategy, priorities and values. While it naturally supports the
local aerospace and defence community, Airbus encourages
initiatives around:■
Education and Youth Development (preferably in STEM);■
Corporate citizenship and/or local community engagement;■
Humanitarian and/or Environment;■
Innovation, R&T and Science.
Today Airbus undertakes a large number of sponsorship anddonation projects across the globe and contributed to morethan 900 initiatives in 58 countries in 2017.

Volunteering at Airbus
In 2017, Airbus mapped the volunteering force of its employees
worldwide. Mid-2017, about 5,000 Airbus employees wereinvolved in volunteering for 85 initiatives contributing to thefollowing SDGs:■
SDG 2: Zero Hunger;■
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1.1 Presentation of the Company

SDG 4: Quality education;
SDG 5: Gender equality;■
SDG 8: Decent work and economic growth;■
SDG 10: Reduced Inequalities;■
SDG 13: Climate action;■
SDG 15: Life on Land.
■■

Airbus encourages and looks for ways to facilitate its employees’social and environmental initiatives to contribute to societal
challenges in the communities around their workplaces.

The Airbus Foundation“With the Airbus Foundation, we reach out to a large population,
inspiring young people and supporting humanitarian missions
around the globe. I would like to thank Airbus employees for their
passion in serving our communities.” Tom Enders, Airbus CEO
Based in Toulouse, the Airbus Foundation has a socio-economic
footprint worldwide. Its goal is to support the international aid
organisations in regions where the Company operates andbeyond. The Airbus Foundation brings products and resources,from relief ﬂights to satellite imagery, to the humanitarian aid
community to help alleviate some of the world’s most pressing
challenges. In parallel, the Foundation invests in communities
around the world with the aim of inspiring and encouraging youth
development through contact with the aerospace industry.
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
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 coordinated61 humanitarian ﬂights, delivering approximately 800 tonnesof aid in over 25 countries. In addition, during the very ﬁrst
hours of a crisis, Airbus Helicopters is able to save people fromharmful situations as well as support on ground rescuers toassess emergency situations. Since 2012 over 345 helicopters
ﬂight hours have been chartered in 11 countries, amounting to€ 490,000. Over the years the foundation also trained about 700
doctors and rescuers, enabling them to operate the Company’s
helicopters to ensure the development of Emergency Medical
Services around the world. Finally, satellite images can be used
to assist humanitarian organisations in the wake of a crisis in a
number of ways. In August 2017, a Foundation branded satellite
portal was opened, providing free of charge access to satellite
imagery to selected partners with whom we have entered into
partnerships. Access has been granted to IFRC and is plannedfor UN WFP and MSF.
Since the launch its youth development activities in 2012, morethan 8,000 young people worldwide were involved with the aim
to help them prepare for tomorrow’s challenges. More than
1,200 Airbus volunteers worldwide supported these inspiring
programmes and in doing so have developed their own skills.
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 fourteen
Airbus sites across France, Germany, Spain, the UK and the US.
With programmes like the Airbus Foundation Little Engineer andDiscovery Space, the Foundation uses aerospace to spark an
interest in science, technology, engineering and mathematics(STEM), facilitating the access to STEM skills for thousands ofyoung minds around the world.
For more information, please refer to the latest Airbus Foundation
Activity Report, which is available at www.airbus.com.

Development Pact between Airbus and Toulouse
At the local level, on 5 June 2016, Airbus CEO Tom Enders andJean-Luc Moudenc, President of Toulouse Métropole, signed theeconomic attractiveness and development pact between Airbus
and Toulouse Métropole, strengthening the cooperation that has
been in place for nearly 50 years. The goal of the pact is to create
the conditions required for maintaining the attractiveness andlong-term sustainability of Airbus’ sites in Toulouse, and thoseof its partners, and to favour the development of Toulouse’s
innovation ecosystem.
Airbus directly employs nearly 28,000 people in the Toulousearea. The commercial aviation site includes the Company’s
operational headquarters, its design ofﬁces and ﬁnal assemblylines for the A320, A330, A380 and A350, and is the largest
industrial site in France with a total surface area of 650 hectares.
Every day, more than 41,000 people enter and leave this site.
This activity feeds a network of more than 1,500 suppliers working
at every level, temporary staff and customers, and represents
more than 50,000 employees. Furthermore, the metropolitan
area has secondary education and university opportunities
needed for recruitment purposes: vocational baccalaureates,
baccalaureate +2-years training courses, engineering degrees
and specialised training. The many research laboratories makeit possible to establish a number of partnerships in a varietyof areas.
As the attractiveness of a region does not concern the economic
and technological ﬁelds alone, Airbus and Toulouse Métropole
are working together on the metropolitan area’s attractivenessfrom the point of view of lifestyle and quality of life, the excellenceof its school, universities and medical facilities, the cultural
heritage, the quality and variety of cultural amenities andevents. For example, Stade Toulousain represents the French
Occitanie region where Airbus has been supporting the local
community’s work-life balance through its sponsorship of theteam since 1983. Team spirit, engagement, respect and a taste
for challenge: these values unite Airbus and the rugby club
Stade Toulousain.
Airbus provides support for the amenities related to scientiﬁc,technical and industrial culture such as Aeroscopia, the Cité del’Espace and the Quai des Savoirs.

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Information on Airbus Activities
1.2 Recent Developments

1.2 Recent Developments
On 7 February 2018, Airbus has signed a DOI with the A400M
Launch Customer Nations (Germany, France, United Kingdom,
Spain, Turkey, Belgium, Luxemburg) deﬁning the framework forachieving a mutually binding contract amendment later in theyear (please refer to the “— Notes to the IFRS Consolidated
Financial Statements — Note 5: Revenues and Gross Margin”).

On 7 March 2018, Airbus announced the ﬁnalisation of the sale ofPlant Holdings, Inc., which holds the Airbus DS Communications
Inc. business, to Motorola Solutions after receiving the required
regulatory approvals. This divestment is part of the portfolio
reshaping within the Airbus Defence and Space Divisionannounced in September 2014.

On 9 February 2018, in line with standard airworthinessprocedures the European Aviation Safety Agency (“EASA”) has
published an Emergency Airworthiness Directive following an
issue identiﬁed on a limited number of recently delivered Pratt &Whitney (“P&W”) GTF engines. Airbus has informed its affected
A320neo family customers and operators. Airbus and P&W are
investigating the root cause of this recent ﬁnding.

On 7 March 2018, following the previously announced changes
to the A380 and A400M delivery plans, Airbus conﬁrmed theformal adjustment of production rates for its A380 and A400M
programmes. The new plan, which was presented to theEuropean Works Council today, involves the production of six
A380s per year starting from 2020 and eight A400Ms per year,
also as of 2020.

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Chapter2

REGISTRATION DOCUMENT 201775

2Management’s Discussion
and Analysis of Financial
Condition and Resultsof Operations

2.1 Operating and Financial Review

76

2.1.1
2.1.2
2.1.3
2.1.4
2.1.5
2.1.6
2.1.7

77
79
80
85
89
90
94

Overview
Signiﬁcant Accounting Considerations, Policies and Estimates
Performance Measures
Results of Operations
Changes in Consolidated Total Equity (Including Non-Controlling Interests)
Liquidity and Capital Resources
Hedging Activities

2.2 Financial Statements

94

2.3 Statutory Auditors’ Fees95

2.4 Information Regarding the Statutory Auditors

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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 of Airbus
as of and for the years ended 31 December 2017 and 2016. These ﬁnancial
statements have been prepared in accordance 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 the most directly comparable
measure calculated and presented in accordance with IFRS. Speciﬁcally,
Airbus makes use of the non-GAAP measures (i.e. Alternative Performance
Measures) “EBIT Adjusted”, “net cash” and “free cash ﬂow”.
Airbus uses these non-GAAP ﬁnancial measures to assess its consolidated
ﬁnancial and operating performance and believes they are helpful in identifying
trends in its performance. These measures enhance management’s ability tomake decisions with respect to resource allocation and whether Airbus ismeeting established ﬁnancial goals.
Non-GAAP ﬁnancial measures have certain limitations as analytical tools, andshould not be considered in isolation or as substitutes for analysis of Airbus’
results as reported under IFRS. Because of these limitations, they should not
be considered substitutes for the relevant IFRS measures.
At the end of the 2016 ﬁnancial year, Airbus implemented the European
Securities and Markets Authority’s guidelines on Alternative Performance
Measures. As a result, certain items are no longer labelled as “one-offs”. Suchitems are now labelled as “Adjustments”. Airbus no longer measures andcommunicates its performance on the basis of “EBIT*” (i.e. EBIT pre-goodwill
impairment and exceptionals) but on the basis of “EBIT” (reported). Terminology
has changed such that “EBIT* before one-offs” has been replaced by “EBIT
Adjusted” and “EPS* before one-offs” has been replaced by “EPS Adjusted”.

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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 € 66.8 billion in 2017, Airbus
is a global leader in aeronautics, space and related services.
Airbus offers the most comprehensive range of passenger
airliners from 100 to more than 600 seats. Airbus is alsoa European leader providing tanker, combat, transportand mission aircraft, as well as one of the world’s leading
space companies. In helicopters, Airbus provides the most

2.1.1.1

efﬁ cient civil and military rotorcraft solutions worldwide.
In 2017, it generated 85% of its total revenues in the civil
sector (compared to 83% in 2016) and 15% in the defence
sector (compared to 17% in 2016). As of 31 December 2017,
Airbus’ active headcount was 129,442 employees, decreased
compared to 2016 (133,782 employees) mainly reﬂ ecting
perimeter change from divestments.

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:
Year ended

Year-End
€/£

€/US$

31 December 2015

1.10950.72591.08870.734031 December 2016

1.10690.81951.05410.856231 December 20171.12970.8767

1.19930.88722.1.1.2

Reportable Business Segments

Airbus operates in three reportable segments which reﬂect theinternal organisational and management structure according
to the nature of the products and services provided.
■

Average€/US$

Airbus Commercial Aircraft: development, manufacturing,marketing and sale of commercial jet aircraft of morethan 100 seats; aircraft conversion and related services;development, manufacturing, marketing and sale of regional
turboprop aircraft and aircraft components;■

Airbus Helicopter s: development, manufacturing,marketing and sale of civil and military helicopters; provisionof helicopter-related services; and■Airbus Defence and Space: is organised in four ProgrammeLines: Military Aircraft, Space Systems, Communications,Intelligence & Security (CIS), and Unmanned Aerial Systems(UAS). It designs, develops and engineers products, systems
and services in the ﬁeld of defence and space for governments,
institutions and commercial customers. In addition, the main
joint ventures design, develop, deliver and support missile
systems as well as space launchers and launch services.

“Other / HQ / Consolidation” comprises the holding
function of Airbus, the Airbus Bank and other activities notallocable to the reportable segments, combined together withconsolidation effects.

2.1.1.3€/£

Signiﬁcant Programme Developments,
Restructuring and Related Financial
Consequences in 2015, 2016 and 2017

A380 programme. In 2015, Airbus Commercial Aircraft
improved gross margin per aircraft. Despite lower A380
deliveries (27 aircraft in 2015 compared to 30 aircraft in 2014),
the programme achieved breakeven for the ﬁrst time in 2015.
In 2016, Airbus Commercial Aircraft found an agreement with
Emirates and Rolls Royce to shift six deliveries from 2017 into
2018 and from 2018 into 2019, which secures the delivery proﬁleinto 2019. 12 aircraft remains the 2018 target for deliveries.
Fixed cost reduction measures will be accelerated to minimise
the impact on breakeven at a lower level of deliveries. A totalof 28 A380s were delivered during 2016.
In 2017, Airbus Commercial Aircraft delivered 15 A380 aircraft
and plans to deliver 12 aircraft in 2018 and 8 aircraft in 2019. The
Emirates order in February 2018 provides increased visibility on
the A380 programme for the years to come. At a baseline of 6deliveries per year, Airbus can produce the A380 in an industrial
efﬁcient way over the coming years. A reasonable industrial
efﬁciency can be maintained at a new baseline of 6 aircraft a yearwith an acceptable margin and cash dilution. No further details
can be added at this stage. As of 28 February 2018, Airbus had
331 orders for A380s, of which 222 have been delivered to 13
airlines. The A380 order book includes orders for 8 customers.
A350 XWB programme. In 2015, Airbus Commercial Aircraft
delivered 14 A350 XWB aircraft. Despite the progress made,signiﬁcant challenges remained with the ramp-up acceleration.

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

In 2016, Airbus Commercial Aircraft delivered 49 A350 XWB
aircraft, including to 7 new customers. To reﬂect expected lower
revenues escalation, increased learning curve costs and delivery
phasing, Airbus Commercial Aircraft recorded a net charge of€ 385 million on A350 XWB loss making contracts in the second
quarter 2016.
In 2017, Airbus Commercial Aircraft delivered 78 A350 XWB
aircraft. New order intake, cancellations, delivery postponements
and other contractual agreements to the end of December 2017
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. The
level of outstanding work in the Final Assembly Line has beensigniﬁcantly reduced. Despite the progress made, challenges
remain with recurring cost convergence as the ramp-up
continues. The A350 programme is preparing to reach thetargeted monthly production rate of 10 by the end of 2018.
A400M programme. Technical progress on the A400M
programme resulted in the recognition of A400M-related
revenues of € 1.6 billion in 2015, € 1.7 billion in 2016 and€ 1.9 billion in 2017.
In 2015, 11 A400M aircraft were delivered, resulting in 21
cumulative deliveries up to 31 December 2015. Management
reviewed the programme evolution and estimated contract
result driven to a large extent from the implications of the
A400M accident in Seville in May 2015, as well as the impactof low inﬂation on the price revision formulae, delays in military
functionality and deliveries, commercial negotiations, cost
reduction targets and challenges in the industrial ramp-up,
together with associated mitigation actions. As a result of thisreview, Airbus Defence and Space recorded an additional net
charge of € 290 million in the second quarter of 2015. The
detailed review continued in the second half of 2015 however
no further net charges were deemed necessary.
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 programme
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
a result of these reviews, Airbus Defence and Space recorded
a charge of € 2,210 million in 2016 (thereof € 1,026 million in
the ﬁrst half-year 2016). This represented the then current best
management assessment.
19 A400M aircraft were delivered in 2017. In total, 57 aircraft
have been delivered as of 31 December 2017.
In 2017, Airbus continued with development activities towardachieving the revised capability roadmap.
As a result of the 2016 detailed contract reviews, Airbus
Defence and Space had recorded a charge of € 2,210 million
in the ﬁscal year 2016. Given the order of magnitude of the
cumulative programme loss, the Board of Directors mandated
the management in February 2017 to re-engage with customers
to cap the remaining exposure.
Airbus has signed a Declaration of Intent (DOI) with the A400M
Launch Customer Nations (Germany, France, United Kingdom,
Spain, Turkey, Belgium, Luxemburg) deﬁning the framework
for achieving a mutually binding contract amendment laterin the year. Airbus, European defence agency OCCAR and
the Customer Nations have agreed to work on a numberof contractual elements including a revamped delivery plan
as well as a roadmap for the development and completionof military capabilities for the A400M. The DOI, ﬁnalised on
7 February 2018, represents an important step towards reachinga contractually binding agreement with OCCAR and the Launch
Customer Nations in 2018 to mitigate risks and to ensure thefuture of the programme. OCCAR is managing the A400M
programme on behalf of the seven Launch Customer Nations.
This DOI provides a new baseline on which to evaluate theA400M contract. With a clear roadmap in place, the remaining
exposure going forward would be more limited.
A detailed review of the programme concluded in the fourth
quarter of 2017 including an estimate of the ﬁnancial impacts of
the above mentioned adaptations on schedule, capabilities andretroﬁt results in an update of the loss making contract provisionof € 1,299 million for the year 2017 (thereof € 1,149 million in the
fourth quarter 2017). Airbus’ remaining exposure going forward
is expected to be more limited. Risks remain on developmentof technical capabilities and the associated costs, on securing
sufﬁcient export orders in time, and on cost reductions as per
the revised baseline. Airbus intends to turn the DOI into a ﬁrm
contract within 2018.
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 unlikely that any of these termination rights will be
exercised.

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

A320 programme. Joint European and US certiﬁcation for the
A320neo was received in the fourth quarter of 2015 with theﬁrst delivery following in January 2016. Despite some schedule
set-backs, the A320neo ramp-up preparation got underway withthe focus on maturity and service-readiness for early operations
in line with customer expectations.
In 2016, 68 aircraft on the A320neo programme were delivered
to 17 customers. Both engine suppliers committed to deliver inline with customer expectations. Challenges remained with the
A320neo ramp-up and delivery proﬁle. For the Pratt & Whitneyengine, challenges were to (i) meet the delivery commitments
in line with agreed schedule; (ii) ﬁx in-service maturity issues inline with Airbus and customer expectations.
In 2017, a total of 181 A320neo Family aircraft were delivered,up from 68 during 2016. Supplier Pratt & Whitney introduced
new engine ﬁ xes in the fourth quarter which were certiﬁed.
Unfortunately a new issue has arisen likely unrelated to theprior ﬁ xes, the impact of which is under assessment withrespect to 2018 deliveries. Engine supplier CFM International
meanwhile experienced some maturity issues in 2017 on somebatches of the LEAP-1A engine. The A320neo ramp-up remains
challenging and requires that the engine suppliers deliver in linewith commitments.
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 is on track to Type Certiﬁcation. First delivery
is targeted for summer 2018.
Airbus makes estimates and provides, across the programmes,for costs related to in-service technical issues which havebeen identiﬁ ed and for which solutions have been deﬁ ned,
which reﬂ ects the latest facts and circumstances. Airbus iscontractually liable for the repair or replacement of the defective

parts but not for any other damages whether direct, indirect,
incidental or consequential (including loss of revenue, proﬁt
or use). However, in view of overall commercial relationships,
contract adjustments may occur, and be considered on a caseby case basis.
Restructuring provisions. In 2016, a net € 182 million provision
related to restructuring measures was booked by Airbus.
A restructuring provision associated with the re-organisationof Airbus of € 160 million was recorded at year-end 2016
following the communication of the plan to the employees andthe European Works Council in November 2016. The Frenchsocial plan was agreed between Airbus and the works council
in June 2017. The German social plan was agreed between
Airbus and the works councils in September 2017 however thereconciliation of interest is still under discussion.
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.

2.1.1.4

Current Trends

Airbus expects the world economy and air trafﬁc to grow inline with prevailing independent forecasts, which assume no
major disruptions.
Airbus’ 2018 earnings and free cash ﬂow guidance is based ona constant perimeter, before M&A: in 2018, Airbus Commercial
Aircraft expects to deliver around 800 commercial aircraft, which
depends on engine manufacturers meeting commitments.
Based on around 800 deliveries, before M&A, Airbus expects
a signiﬁcant increase in EBIT Adjusted compared to 2017. Free
cash ﬂow is expected to be similar to 2017 before M&A andcustomer ﬁnancing.

2.1.2 Signiﬁcant Accounting Considerations, Policies and Estimates

Airbus’ signiﬁ cant accounting considerations, policies andestimates are described in the Notes to the Consolidated
Financial Statements.

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 2: Signiﬁcant Accounting Policies”
and “Note 6: Acquisitions and disposals”.

2.1.2.2

Capitalised Development Costs

Pursuant to the application of IAS 38 “Intangible Assets”, Airbus
assesses whether product-related development costs qualify
for capitalisation as internally generated intangible assets.
Criteria for capitalisation are strictly applied. All research anddevelopment costs not meeting the IAS 38 criteria are expensed
as incurred in the consolidated income statement. Please referto the “Notes to the IFRS Consolidated Financial Statements —Note 2: Significant A ccounting Policies — Research anddevelopment expenses and Development costs” and “Note 17:
Intangible assets”.

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2.1 Operating and Financial Review

2.1.2.3

Accounting for Hedged Foreign
Exchange Transactions in
the Financial Statements

More than 75% of Airbus’ revenues are denominatedin US dollars, whereas a substantial portion of its costs isincurred in euros and, to a smaller extent, in pounds sterling.
Airbus uses hedging strategies to manage and minimise theimpact of exchange rate ﬂuctuations on its proﬁts, including
foreign currency 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

extent 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 otherlong-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 Airbus, see “— 2.1.6.4 Sales Financing”.

Foreign Currency Translation

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

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 the2.1.2.6

Provisions for Loss Making Contracts

Loss making contract provisions are reviewed and reassessed
regularly. However, future changes in the assumptions used by
Airbus or a change in the underlying circumstances may lead toa revaluation of past loss making contract provisions and havea corresponding positive or negative effect on the Company’s
future ﬁnancial performance. Please refer to the “Notes to the
IFRS Consolidated Financial Statements — Note 2: SigniﬁcantAccounting Policies — Provision for loss making contracts”
and “Note 22: Provisions, Contingent Assets and Contingent
Liabilities”.

2.1.3 Performance Measures

2.1.3.1

DivisionsAirbus Commercial Aircraft
Set forth below is a summary of the measures for the activities of Airbus Commercial Aircraft for the past three years.
Year ended
31 December 2017

Year ended
31 December 2016

Year ended
31 December 2015

Order Intake (net)143,361

114,938

139,062

Order Book

950,354

1,010,200

952,450

Revenues

50,95849,23745,854

EBIT

3,428

1,543

2,287

in % of revenues

6.7%

3.1%

5.0%

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2.1 Operating and Financial Review

Airbus Helicopters
Set forth below is a summary of the measures for the activities of Airbus Helicopters for the past three years.
Year ended
31 December 2017

Year ended
31 December 2016

Year ended
31 December 2015

Order Intake (net)

6,544

6,057

6,168

Order Book

11,201

11,26911,769

Revenues

6,450

6,652

6,786

EBIT

337

308

427

in % of revenues

5.2%

4.6%

6.3%

(in €m)Airbus Defence and SpaceSet forth below is a summary of the measures for the activities of Airbus Defence and Space for the past three years.
Year ended
31 December 2017

Year ended
31 December 2016

Year ended
31 December 2015

8,893

15,393

14,440Order Book

37,40741,49942,861

Revenues

10,804

11,85413,080

EBIT

212

(93)

736

in % of revenues

2.0%(0.8)%

5.6%(in €m)Order Intake (net)

2.1.3.2

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 Airbus receives a down payment on a deﬁnitive
contract. Defence-related orders are included in the backlog
upon signature of the related procurement contract (and thereceipt, in most cases, of an advance payment). Commitments
under defence “umbrella” or “framework” agreements bygovernmental customers are not included in backlog until
Airbus is ofﬁcially notiﬁed.

For commercial aircraft contracts, amounts of order backlog
reﬂected in the table below are derived 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 theperiod-end spot rate for the non-hedged portion of expectedcash ﬂows). The amount of defence-related order backlog isequal to the contract values of the corresponding programmes.

CONSOLIDATED BACKLOG FOR THE YEARS ENDED 31 DECEMBER 2017, 2016 AND 2015(1)Year ended
31 December 2017

Airbus Commercial Aircraft
Airbus Helicopters(3)

Year ended
31 December 2016

Year ended
31 December 2015

Amount in €bn

In percentage(2)Amount in €bn

In percentage(2)Amount in €bn

In percentage(2)

950.4

95.1%

1,010.2

95.0%

952.4

94.6%

11.2

1.1%

11.3

1.1%

11.8

1.2%

Airbus Defence and Space

37.4

3.8%

41.5

3.9%

42.9

4.2%

Total Divisional backlog

999.0

100%

1,063.0100%

1,007.1

100%

Other / HQ / Consolidation

Total

(2.2)

(2.6)

(1.2)

996.8

1,060.4

1,005.9(1) Without options.
(2) Before “Other / HQ / Consolidation”.
(3) Based on catalogue prices for commercial aircraft activities.

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2.1 Operating and Financial Review

2017 compared to 2016. The € -63.6 billion decrease in theorder backlog from 2016, to € 996.8 billion in 2017, primarily
reﬂects 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 Commercial Aircraft’s 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. Orderintake consisted of 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 Commercial Aircraft amounted to7,265 aircraft at the end of 2017 (as compared to 6,874 aircraftat the end of 2016). This represents a record year-end level ofbacklog by units.
Airbus Helicopters’ backlog slightly decreased by € -0.1 billion
from 2016, to € 11.2 billion in 2017, reﬂ ecting a book-to-billratio, by value in euros, of around one with new net ordersof € 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 comparedto 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.
2016 compared to 2015. The € 54.5 billion increase in theorder backlog from 2015, to € 1,060.4 billion, primarily reﬂects
Airbus’ order intake in 2016 (€ 134 billion catalogue price), which
exceeded the reduction of the backlog from 2016 deliveries.
Additionally, the stronger US dollar spot rate used for conversionof the non-hedged portion of the backlog into euro at year-end(€/US$ 1.05 as compared to €/US$ 1.09 at the end of 2015) had
a positive impact on order backlog of approximately € +31 billion.
Airbus Commercial Aircraft’s backlog increased by € 57.8 billion
from 2015, to € 1,010.2 billion in 2016, primarily reﬂecting abook-to-bill ratio of more than one (calculated using units of
new net orders). Order intake consisted of 731 net orders in2016 (as compared to 1,080 in 2015), driven mainly by the A320
Family, which received 607 net ﬁrm orders (561 A320neo and
46 A320ceo). Total order backlog at Airbus Commercial Aircraft
amounted to 6,874 aircraft at the end of 2016 (as compared to
6,831 aircraft at the end of 2015).
Airbus Helicopters’ backlog decreased by € -0.5 billion from2015, to € 11.3 billion in 2016, reﬂecting a book-to-bill ratio of lessthan one with new net orders of € 6.1 billion. Airbus Helicopters
received 353 net orders in 2016 (as compared to 333 in 2015).
Total order backlog amounted to 766 helicopters at the endof 2016 (as compared to 831 helicopters at the end of 2015).
Airbus Defence and Space’s backlog decreased by € -1.4 billion
from 2015, to € 41.5 billion in 2016, reﬂecting a book-to-bill ratioof more than one with new net orders of € 15.4 billion. The
order intake is mainly driven by Military aircraft with 16 light andmedium aircraft ordered by Canada and Euroﬁghter sustainmentand support contracts as well as in Space with telecom andearth navigation and science.

The table below illustrates the proportion of civil and defence backlog at the end of each of the past three years.
Year ended
31 December 2017
Amount in €bn(1)Year ended
31 December 2016

In percentage Amount in €bn(1)Year ended
31 December 2015

In percentage Amount in €bn(1)In percentage

Backlog:
Civil Sector
Defence Sector

Total(1) Including “Other / HQ / Consolidation”.

959.9

96%

1,020.6

96%

967.5

96%

36.9

4%

39.8

4%

38.4

4%

996.8

100%

1,060.4

100%

1,005.9100%

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2.1 Operating and Financial Review

2.1.3.3

Use of EBIT Adjusted

Airbus uses an alternative performance measure EBIT Adjusted as a key indicator capturing the underlying business margin by
excluding material charges or proﬁts caused by movements in provisions related to programmes, restructurings or foreign exchange
impacts as well as capital gains/losses from the disposal and acquisition of businesses.
Set forth below is a table reconciling Airbus’ EBIT with its EBIT Adjusted.

(in €m)

EBIT
PDP mismatch / BS revaluation
A400M business update
A350XWB business update
Compliance
ASL creation phase 2
Defence Electronics net capital gainYear ended
31 December 2017

Year ended
31 December 2016

Year ended
31 December 2015

3,421

2,258

4,062

7

930

635

1,299

2,210

290

0

385

0

117

0

0

0

(1,175)

0

(604)

0

0

Portfolio in Airbus Defence and Space andAirbus Commercial Aircraft

(7)

33

(90)

Other M&A

20

0

0

Restructuring / Transformation

0

182

(41)

Dassault Aviation disposal

EBIT Adjusted

2.1.3.4

0

(868)

(748)

4,253

3,955

4,108

Year ended
31 December 2017

Year ended
31 December 2016

Year ended
31 December 2015

3,554

2,811

2,766

EBIT Adjusted by Division(in €m)Airbus Commercial Aircraft
Airbus Helicopters

337

350

427

Airbus Defence and Space

872

1,002

1,051

Total Divisional EBIT Adjusted

4,763

4,163

4,244

Other / HQ / Consolidation

(510)

(208)

(136)

4,253

3,955

4,108

Year ended
31 December 2017

Year ended
31 December 2016

Year ended
31 December 2015

3,428

1,543

2,287

Airbus Helicopters

337

308

427

Airbus Defence and Space

212

(93)

736

Total Divisional EBIT

3,977

1,758

3,450

Other / HQ / Consolidation(556)

500(2)

612(1)

Total

3,421

2,258

4,062

Total

2.1.3.5

EBIT by Division(in €m)Airbus Commercial Aircraft(1) “Other / HQ / Consolidation” comprises results from headquarters, which mainly consist of the “share of profit from investments in associates” from Airbus’ investment
in Dassault Aviation.
(2) “Other / HQ / Consolidation” comprises the capital gain from the sale of Dassault Aviation shares and the revaluation at fair value of the remaining investment in Dassault Aviation.

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2.1 Operating and Financial Review

2017 compared to 2016. 2017 ﬁnancials reﬂect the perimeterchanges in Airbus Defence and Space and Helicopters resulting
in reduction in revenues of around € 2 billion and related EBIT
impact.

the H225 accident and some campaign costs. However, theunderlying performance continued to be supported by ongoingtransformation measures and strong efforts to adapt to market
challenges.

Airbus’ consolidated EBIT increased by 51.5%, from € 2.3 billion
for 2016 to € 3.4 billion for 2017.

Airbus Defence and Space’s EBIT decreased from € 736 million
for 2015 to € -93 million for 2016. A good operational performance
partially mitigated the perimeter change effects from portfolio
reshaping. In addition, a net charge of € 2,210 million wasrecorded related to the A400M programme for the period
ended 31 December 2016 (€ 290 million for the period ended
31 December 2015). Airbus Defence and Space’s EBIT in 2016
also included a net gain of € 1,175 million from the completionof the second phase of the creation of the ASL joint venture,
an adjustment of the provision for restructuring generating a
positive impact of € 20 million and some further small disposal
impacts.

Airbus Commercial Aircraft’s 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 made in reducing the A350 losses in linewith 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 termination of theEuroﬁghter Austria investigation by the Munich Public Prosecutor(See “— 2.1.1.3 Significant Programme Developments,
Restructuring and Related Financial Consequences in 2015,2016 and 2017”).
2016 compared to 2015. 2016 ﬁnancials reﬂect the portfolio
reshaping in Airbus Defence and Space resulting in reduction
in revenues of about € 1 billion and related EBIT impact.
Airbus’ consolidated EBIT decreased by 44.4%, from € 4.1 billion
for 2015 to € 2.3 billion for 2016.
Airbus Commercial Aircraft’s EBIT decreased from € 2.3 billion
for 2015 to € 1.5 billion for 2016. A solid operational performance
driven by a higher A320 volume and R&D reduction was weighed
down by the lower A330 production rate, transition pricing,ramp-up costs and a negative revaluation impact from foreignexchange linked to the dollar pre-delivery mismatch and balance
sheet revaluation in the amount of € -902 million. Additionally,
it was affected by a € 385 million net charge on the A350 XWB
programme.
Airbus Helicopters’ EBIT decreased from € 427 million for2015 to € 308 million for 2016, reflecting an unfavourable
mix and lower commercial ﬂight hours in services as well as

The EBIT of Other / Headquarters / Consolidation decreased by
18.3% from € 612 million for 2015 to € 500 million for 2016. 2016
included the capital gain from the sale of Dassault Aviation sharesand the revaluation at fair value of the remaining investment in
Dassault Aviation from ongoing divestment started in 2015.
It also included the restructuring provisions for € 160 million
recorded at year-end 2016 following the announcement in
September 2016 of the merger of the Group structure with its
largest division Airbus Commercial Aircraft to increase futurecompetitiveness.
Foreign currency impact on EBIT. More than 75% of Airbus’
revenues are denominated in US dollars, whereas a substantial
portion of its costs is incurred in euros and, to a lesser extent,
pounds sterling. Given the long-term nature of its businesscycles (evidenced by its multi-year backlog), Airbus hedges
a signiﬁcant portion of its net foreign exchange 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 the impact that h edging
activities have on Airbus’ EBIT, the latter is also affected by
the impact of revaluation of certain assets and liabilities at theclosing rate and the impact of natural hedging.
During 2017, cash flow hedges covering approximately
US$ 25.3 billion of Airbus’ US dollar-denominated revenues
matured. In 2017, the compounded exchange rate at which
hedged US dollar-denominated revenues were accounted forwas €/US$ 1.29, as compared to €/US$ 1.32 in 2016. See “—
2.1.2.4 Foreign Currency Translation”.
During 2016, cash flow hedges covering approximately
US$ 23.5 billion of Airbus’ US dollar-denominated revenues
matured excluding US$ 1.5 billion of new hedges entered into
to address intra-year shifts in Net Exposure linked to delivery
phasing. In 2016, the compounded exchange rate at which
hedged US dollar-denominated revenues were accounted forwas €-US$ 1.32, as compared to €-US$ 1.34 in 2015.

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2.1 Operating and Financial Review

2.1.4 Results of Operations
Set forth below is a summary of Airbus’ Consolidated Income Statements (IFRS) for the past three years.

(in €m, except for earnings per share)

Year ended
31 December 2017

Year ended
31 December 2016

Year ended
31 December 2015

Revenues

66,767

66,58164,450

Cost of sales(59,160)(61,317)(55,599)

Gross margin

7,607

5,264

8,851

Selling and administrative expenses(2,439)(2,723)(2,651)

Research and development expenses(2,807)(2,970)(3,460)

Other income

981

2,689

474

Other expenses

(336)

(254)

(222)

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

415

252

1,070

Profit before finance costs and income taxes

3,421

2,258

4,062

Interest result

(328)

(275)

(368)

Other financial result

1,477

(692)

(319)

Income taxes(1,693)

(291)

(677)

Profit for the period

2,877

1,000

2,698

2,873

995

2,696

Attributable to:Equity owners of the parent (Net Income)Non-controlling interests

4

5

2

Earnings per share (basic) (in €)

3.71

1.29

3.43

Earnings per share (diluted) (in €)

3.70

1.29

3.42

Set forth below are year-to-year comparisons of results of operations, based upon Airbus’ Consolidated Income Statements.

2.1.4.1

Consolidated Revenues

Set forth below is a breakdown of Airbus’ consolidated revenues by Division for the past three years.
Year ended
31 December 2017

Year ended
31 December 2016

Year ended
31 December 2015

Airbus Commercial Aircraft

50,95849,23745,854

Airbus Helicopters

6,450

6,652

6,786

(in €m)Airbus Defence and Space

10,804

11,85413,080Total Divisional revenues

68,212

67,74365,720

Other / HQ / Consolidation(1,445)(1,162)(1,270)Total

66,767

66,58164,450For 2017, consolidated revenues were stable at € 66.8 billion, an 0.3% increase from € 66.6 billion in 2016, as higher aircraft deliveriesat Airbus Commercial Aircraft were offset by the portfolio reshaping in Airbus Defence and Space and in Airbus Helicopters
resulting in reduction of revenues of around € 2 billion.
For 2016, consolidated revenues increased by 3.3%, from € 64.5 billion for 2015 to € 66.6 billion for 2016. The increase wasprimarily due to higher revenues at Airbus Commercial Aircraft.

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2.1 Operating and Financial Review

Airbus Commercial Aircraft
Set forth below is a breakdown of deliveries of commercial aircraft by product type for the past three years.
Year ended
31 December 2017

Year ended
31 December 2016

Year ended
31 December 2015

A320 Family

558

545

491

A330

67

66

103

A350 XWB

78

49

14

Number of aircraft

A380

15

28

27

Total

718

688

635

Airbus Commercial Aircraft’s consolidated revenues increasedby 3.5%, from € 49.2 billion for 2016 to € 51.0 billion for 2017. Thiswas due to record deliveries of 718 aircraft (compared to 688
deliveries in 2016) including 78 A350 XWBs and a favourable
foreign exchange impact.

Airbus Commercial Aircraft’s consolidated revenues increasedby 7.4%, from € 45.9 billion for 2015 to € 49.2 billion for 2016.
This was due to higher deliveries of 688 aircraft (compared
to 635 deliveries in 2015) including 49 A350 XWBs and thestrengthening US dollar.

Airbus Helicopters
Set forth below is a breakdown of deliveries of helicopters by product type for the past three years.
Year ended
31 December 2017

Year ended
31 December 2016

Year ended
31 December 2015

Light

166

177

178

Number of aircraft

Medium

178

165

124

Heavy

48

57

77

of which NH90

40

38

35

Tiger

17

19

16

Total

409

418

395

Consolidated revenues of Airbus Helicopters decreased by
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 to decrease in 2017,
reﬂecting the soft Civil & Parapublic market, particularly in Oil &Gas. The disposal of Vector Aerospace had a negative perimeterchange impact of around € 0.1 billion.
Consolidated revenues of Airbus Helicopters decreased by
2.0%, from € 6.8 billion for 2015 to € 6.7 billion in 2016, mainly
reﬂecting an unfavourable mix and lower commercial ﬂight hours
in services.

Airbus Defence and SpaceSet forth below is a breakdown of deliveries of Airbus Defence and Space by product type for the past three years.
Year ended
31 December 2017

Year ended
31 December 2016

Year ended
31 December 2015

A400M

19

17

11

A330 MRTT (Tanker)

1

2

4

Number of aircraft

Light & Medium aircraft

7

14

19

Telecom satellites

4

1

5

Total

31

34

39

Airbus Defence and Space’s consolidated revenues
decreased by 8.9% from € 11.9 billion for 2016 to € 10.8 billion
in 2017, reﬂ ecting 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
in recent years.

Airbus Defence and Space’s consolidated revenues decreased
by 9.4% from € 13.1 billion for 2015 to € 11.9 billion in 2016,
reﬂecting a negative impact from portfolio reshaping of about€ 1 billion but were broadly stable on a comparable basis.

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2.1 Operating and Financial Review

2.1.4.2

Consolidated Cost of Sales

Consolidated 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 (in 2016: € 2,210 million) and theperimeter changes at Airbus Defence & Space. In 2016 a chargeof € 385 million was booked for the A350 XWB programme(in 2017: € 0 million).
Consolidated cost of sales increased by 10.3% from € 55.6 billion
for 2015 to € 61.3 billion for 2016. The increase was primarily
due to business growth at Airbus Commercial Aircraft andnegative foreign exchange revaluation impacts from PDP/BS
revaluation. The charge related to the A400M programmein the amount of € 2,210 million (in 2015: € 290 million) andto the A350 XWB programme in the amount of € 385 million(in 2015: € 0 million).

2.1.4.3

Consolidated Sellingand Administrative Expenses

Consolidated selling and administrative expenses decreasedby 10.4%, from € 2.7 billion for 2016 to € 2.4 billion for 2017.
Consolidated selling and administrative expenses were broadly
stable at € 2.7 billion in 2016 and 2015.

2.1.4.4

Consolidated Researchand Development Expenses

For 2016, other income and other expenses was €+2,435 million
net as compared to € +252 million net for 2015. The net increaseis due mainly to the capital gain of € 1,175 million following thecompletion of the creation of the ASL joint venture, the capitalgain from the sale of Dassault Aviation shares of € 528 million
and the revaluation at fair value of the remaining investment
in Dassault Aviation of € 340 million and the capital gain of€ 146 million on the disposal of the business communications
entities.

2.1.4.6

Consolidated Share of Proﬁt
from Investments Accounted forunder the Equity Method and Other
Income from Investments

Consolidated share of proﬁt from investments accounted forunder the equity method and other income from investments
principally includes results from companies accounted forunder the equity method and the results attributable to nonconsolidated investments.
For 2017, Airbus recorded € 415 million in consolidated shareof proﬁ t from investments accounted for under the equity
method and other income from investments as compared to€ 252 million for 2016. 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”.

Consolidated research and development expenses decreased
by 5.5%, from € 3.0 billion for 2016 to € 2.8 billion for 2017
primarily reflecting a reduction of R&D activities on theA350 XWB programme at Airbus Commercial Aircraft. In
addition, an amount of € 219 million of development costs has
been capitalised, mainly related to the A330neo and H160
programmes. See “— 2.1.2.2 Capitalised development costs”.

For 2016, Airbus recorded € 252 million in consolidated shareof proﬁ t from investments accounted for under the equity
method and other income from investments as compared to€ 1,070 million for 2015. It also includes Airbus’ share in ASL’s
results. In 2015, it included the net gain from the partial saleof Dassault Aviation shares.

Consolidated research and development expenses decreasedby 14.2%, from € 3.5 billion for 2015 to € 3.0 billion for 2016
primarily reﬂecting a reduction of R&D activities on the A350 XWB
programme at Airbus Commercial Aircraft as committed. In
addition, an amount of € 311 million of development costs has
been capitalised, mainly related to the A350-1000, FSTA andH160 programmes.

2.1.4.7

2.1.4.5

Consolidated Other Income
and Other Expenses

Consolidated other income and other expenses include gains
and losses on disposals of investments, of ﬁxed assets andincome from rental properties.
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 thedisposal of the defence electronics business.

Consolidated Interest Result

Consolidated 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.
For 2017, Airbus recorded a consolidated net interest expenseof € -328 million, as compared to € -275 million for 2016. The
decrease in interest result was primarily due to higher interest
expense recorded on European Government refundable
advances.
For 2016, Airbus recorded a consolidated net interest expenseof € -275 million, as compared to € -368 million for 2015. The
improvement in interest result is primarily due to lower interest
expense recorded on European Government refundable
advances.

2

88Registration Document 2017 - AIRBUS
Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.1 Operating and Financial Review

2.1.4.8

Consolidated Other Financial Result

This line item includes, among others, the impact from therevaluation of ﬁnancial instruments, the effect of foreign exchange
valuation of 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 Finance Costs”.
Consolidated other ﬁnancial result increased from € -692 million
for 2016 to € 1,477 million for 2017. This is mainly related toa 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.
Please refer to the “Notes to the IFRS Consolidated Financial
Statements — Note 23: Other Financial Assets and Other
Financial Liabilities”.
Consolidated other ﬁnancial result decreased from € -319 million
for 2015 to € -692 million for 2016 reﬂecting a € -373 million
negative change from revaluation of financial instruments
together with a deterioration of the foreign exchange translationof monetary items.

as compared to 2015 (€ 3,375 million). The effective tax rate was
23% in 2016. The effective tax rate was affected by the sale ofshares of Dassault Aviation and the creation of ASL both subject
to speciﬁc tax treatment. These effects were partially offset byadditional income tax charges including the planned reductionof the income tax rate in France from 34.43% to 28.92% enacted
in December 2016.

2.1.4.10 Consolidated Non-Controlling
Interests
For 2017, consolidated proﬁt for the period attributable to noncontrolling interests was € 4 million, as compared to € 5 million
for 2016.

2.1.4.11 Consolidated Proﬁt for the Period
Attributable to Equity Ownersof the Parent (Net Income)As a result of the factors discussed above, Airbus recorded
consolidated net income of € 2,873 million for 2017, as comparedto € 995 million for 2016.

2.1.4.12 Earnings per Share
2.1.4.9

Consolidated Income Taxes

For 2017, income tax expense was € -1,693 million as comparedto € -291 million for 2016. The increase was primarily due to thehigher income before tax recorded in 2017 (€ 4,570 million) as
compared to 2016 (€ 1,291 million). The effective tax rate was37%. 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 surchage and the reduction in deferred
tax asset due to the income tax rate decrease in the US, bothenacted end of 2017. This was partially offset by the disposal ofthe defence electronics business, which is taxed at a reduced
rate. Without these impacts, the effective tax rate would beapproximately 26%. Please refer to the “Notes to the IFRS
Consolidated Financial Statements — Note 15: Income Tax”.
For 2016, income tax expense was € -291 million as comparedto € -677 million for 2015. The decrease was primarily due tothe lower income before tax recorded in 2016 (€ 1,291 million)

Basic earnings were € 3.71 per share in 2017, as compared to€ 1.29 per share in 2016. The number of issued shares as of
31 December 2017 was 774,556,062. The denominator used to
calculate earnings per share was 773,772,702 shares (in 2016:
773,798,837), reﬂecting the weighted average number of shares
outstanding during the year. In 2015, the Company reported
basic earnings of € 3.43 per share, based on a denominatorof 785,621,099 shares. For further details, please refer to the“Notes to the IFRS Consolidated Financial Statements —Note 32: Total Equity” and “Note 16: Earnings per Share”.
Diluted earnings were € 3.70 per share in 2017, as comparedto € 1.29 per share in 2016. The denominator used to calculate
diluted earnings per share was 779,301,228 (in 2016:
779,109,634), reﬂecting the weighted average number of shares
outstanding during the year, adjusted to assume the conversionof all potential ordinary shares. In 2015, the Company reported
diluted earnings of € 3.42 per share, based on a denominatorof 788,491,929 shares.

REGISTRATION DOCUMENT 201789

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

2.1.5 Changes in Consolidated Total Equity (Including Non-Controlling Interests)
The following table sets forth a summary of the changes in consolidated total equity for the period 1 January 2017 through31 December 2017.
(in €m)Balance as at 31 December 2016

3,652

Profit for the period

2,877

Other comprehensive income

7,773

Thereof foreign currency translation adjustments(539)

Cash distribution to shareholders / Dividends paid to non-controlling interests(1,046)

Capital increase83

Equity transactions (IAS 27)(25)

Change in treasury shares

1

Share-based payment (IFRS 2)

36

Balance as at 31 December 201713,351

Please refer to the “Airbus SE IFRS Consolidated Financial
Statements — IFRS Consolidated Statements of Changes in
Equity for the years ended 31 December 2017 and 2016” andto the “Notes to the IFRS Consolidated Financial Statements— Note 32: Total Equity”.

31 December 2016 compared to 31 December 2015, basedon a closing rate of €/US$ 1.05. For further information on themeasurement of the fair values of ﬁnancial instruments, pleaserefer to the “Notes to the IFRS Consolidated Financial Statements— Note 35: Information about Financial Instruments”.

Set forth below is a discussion on the calculation of accumulated
other comprehensive income (“AOCI”) and the related impact
on consolidated total equity.

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 ﬂ ow hedges withnegative mark to market valuations) and deferred tax liabilities(for cash ﬂow hedges with positive mark to market valuations).
Set out below is a graphic presentation of cash ﬂow hedge
related movements in AOCI over the past three years (in €m).

2.1.5.1

Cash Flow Hedge Related Impact
on AOCI

As of 31 December 2017, the notional amount of Airbus’ portfolioof outstanding cash ﬂow hedges amounted to US$ 88.7 billion,
hedged against the euro and the pound sterling. The yearend mark to market valuation of this portfolio required under
IAS 39 resulted in a positive 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 as compared to anegative pre-tax AOCI valuation change of € -0.3 billion as ofNote: The mark to market of the backlog is not reﬂected in theaccounts whereas the mark to market of the hedge book is
reﬂected in AOCI.

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Registration Document 2017 - AIRBUS
Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.1 Operating and Financial Review

CASH FLOW HEDGE RELATED MOVEMENTS IN AOCI IN €M (BASED ON YEAR-END EXCHANGE RATES)-9,525
OCI Net Asset-9,810836
2,612

Net Deferred Taxes

2,616
-238
-6,913Net Equity OCI-7,194598

31 December 2015: US$ 1.09

31 December 2016: US$ 1.05

31 December 2017: US$ 1.20

As a result of the positive change in the fair market valuation of the cash ﬂow hedge portfolio in 2017, AOCI amounted to a net
asset of € +0.8 billion for 2017, as compared to a net liability of € -9.8 billion for 2016. The corresponding € -2.8 billion tax effectled to a net deferred tax liability of € -0.2 billion as of 31 December 2017 as compared to a net deferred tax asset of € 2.6 billion
as of 31 December 2016.
For further information, please refer to the “Notes to the IFRS Consolidated Financial Statements — Note 35.5: Derivative Financial
Instruments and Hedge Accounting Disclosure”.

2.1.5.2

Currency Translation Adjustment Impact on AOCIThe € -539 million currency translation adjustment related impact on AOCI in 2017 mainly reﬂects the effect of the variations of
the US dollar and the pound sterling.

2.1.6 Liquidity and Capital Resources
Airbus’ 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 access to capital
markets.
Airbus deﬁnes its consolidated net cash position as the sumof (i) cash and cash equivalents and (ii) securities, minus(iii) ﬁ nancing 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 2017 was € 13.4 billion (€ 11.1 billion as of
31 December 2016).

The liquidity is further supported by a € 3.0 billion syndicatedback-up facility, undrawn as of 31 December 2017 with noﬁ nancial 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 — Financing Liabilities”. The factors affecting Airbus’ 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 201791

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

2.1.6.1

Cash Flows

Airbus generally ﬁnances its manufacturing activities and product development programmes, and in particular the developmentof new commercial aircraft, through a combination of ﬂows generated by operating activities, customer advances, risk-sharing
partnerships with subcontractors and European Government refundable advances. In addition, Airbus’ 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 Airbus’ consolidated net cash position over the periods indicated.
(in €m)

2017

2016

2015

Consolidated net cash position at 1 January

11,113

10,003

9,092

Gross cash flow from operations(1)

4,451

3,565

4,614

266

346

(723)

Changes in other operating assets and liabilities (working capital)(2)thereof customer financing

(100)

(252)

(150)

(982)

(730)

(1,066)(2,558)(3,060)(2,924)

3,735

3,181

2,825

thereof M&A transactions

886

2,025

1,650

Free Cash Flow before M&A(5)

2,849

1,156

1,175

Cash used for investing activities(3)thereof industrial capital expenditures
Free Cash Flow(4)Cash flow from customer financing (net)

(100)

(252)

(150)

Free Cash Flow before customer financing

3,835

3,433

2,975

Free Cash Flow before M&A and customer financing

2,949

1,408

1,325

Cash distribution to shareholders / Non-controlling interests(1,046)(1,012)(948)

Contribution to plan assets of pension schemes

(458)

(290)

(217)

Changes in capital and non-controlling interests

83

60

195

Share buyback / Change in treasury shares

0

(736)

(264)

OthersConsolidated net cash position as of 31 December

(36)

(93)

(680)

13,391

11,113

10,003(1) Represents cash provided by operating activities, excluding (i) changes in other operating assets and liabilities (working capital), (ii) contribution to plan assets of pension
schemes and (iii) realised foreign exchange results on Treasury swaps (€ -74 million in 2015; € -151 million in 2016; € 185 million in 2017). 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 of securities (net investment of € -2,361 million for 2015; net disposal of € 337 million for 2016; net investment of € -1,233 million for 2017), which areclassified 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 resultson Treasury swaps. Excluding bank activities. Free Cash Flow is an alternative performance measure and indicator that reflects the amount of cash flow generated fromoperations 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 thatreflects Free Cash Flow excluding those cash flows from the disposal and acquisition of businesses.

The net cash position as of 31 December 2017 was € 13.4 billion,
a 20.5% increase from 31 December 2016. The increase primarily
reﬂ ects the gross cash ﬂ ow from operations (€ 4.5 billion),
partially offset by the cash distribution to shareholders / noncontrolling interests (€ -1.0 billion) and the cash used for investing
activities (€ -1.0 billion).

Gross Cash Flow from Operations
Gross cash ﬂow from operations is an alternative performancemeasure and an indicator used by Airbus to measure its operating
cash performance before changes in working capital. Gross
cash ﬂow from operations increased by 24.9% to € 4.5 billion
for 2017, which reﬂects the strong EBIT Adjusted.

Changes in Other Operating Assets
and Liabilities
Changes in other operating assets and liabilities is comprisedof inventories, trade receivables, other assets and prepaid
expenses netted against trade liabilities, other liabilities (including
customer advances) and deferred income. They resulted in a
€ +0.3 billion positive impact on the net cash position for 2017,
unchanged from a positive impact of € +0.3 billion for 2016.
In 2017, the main net contributors to the positive working capitalvariation were an increase in trade liabilities (€ 1.4 billion) due tomore favourable payment terms to suppliers and the pre-delivery
payment from customers (€ 1.3 billion). This was mainly offset
by the change in inventory (€ -2.6 billion) reﬂecting increased
work in progress mainly associated with the A350 XWB andthe A320neo at Airbus Commercial Aircraft.

2

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Registration Document 2017 - AIRBUS
Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.1 Operating and Financial Review

European Government refundable advances. As of
31 December 2017, total European Government refundable
advances liabilities, recorded on the statement of ﬁ nancial
position in the line items “non-current other ﬁnancial liabilities”
and “current other ﬁnancial liabilities” due to their speciﬁc nature,amounted to € 5.9 billion, including accrued interest.
European Government refundable advances (net ofreimbursements) decreased in 2017, primarily related to the
update of the valuation of refundable advances from European
Governments on the A380 programme following a review of thecommercial assumptions as well as due to repayments madeunder the A350 XWB and the A380 programmes. Please referto the “Notes to the IFRS Consolidated Financial Statements— 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.
Industrial capital expenditures. Industrial capital expenditures(investments in property, plant and equipment and intangible
assets) amounted to € -2.6 billion for 2017 as comparedto € -3.1 billion for 2016 and € -2.9 billion for 2015. Capital
expenditures in 2017 related to programmes at Airbus
Commercial Aircraft of € -1.9 billion (among others for the
ramp-up phase of A350 XWB and A320neo Family, for Beluga
XL and for the A330neo) and additional projects in the Divisionsof € -0.7 billion. Capital expenditures include product-related
development costs that are capitalised in accordance with
IAS 38. See “— 2.1.2.2 Capitalised development costs”.
M&A transactions. 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 Aerospacesale. Please refer to the “Notes to the IFRS Consolidated
Financial Statements — Note 6: Acquisitions and Disposals”.
In 2016, the € 2.0 billion ﬁgure principally reﬂects the sale ofDassault Aviation shares and the ﬁnalisation of the creation of
ASL in the ﬁrst half of 2016.

Free Cash Flow
Airbus 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 to plan assetsof pension schemes, (v) realised foreign exchange results on
Treasury swaps and (vi) Airbus bank activities. It is an alternative
performance measure and key indicator that is important inorder to measure the amount of cash ﬂ ow generated fromoperations after cash used in investing activities. As a resultof the factors discussed above, Free Cash Flow amounted to€ 3.7 billion for 2017 as compared to € 3.2 billion for 2016 and€ 2.8 billion for 2015. Free Cash Flow before customer ﬁnancing
was € 3.8 billion for 2017 as compared to € 3.4 billion for 2016and € 3.0 billion for 2015.

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 Airbus in its ﬁnancial guidance, especially when there
is higher uncertainty around customer ﬁnancing activities, suchas during the suspension of ECA ﬁnancing support.

Change in Treasury Shares
In 2017, there was no change in treasury shares. Change intreasury shares for 2016 amounted to € -0.7 billion, which was
mostly related to the share buyback. In 2015 the Company
undertook a share buyback for a maximum amount of € 1 billion.
The total cumulative amount of shares bought back and cancelledin 2015 and 2016 under the programme was 17,016,374 shares.
The buyback programme took place between 2 November
2015 and 30 June 2016. All shares purchased under the sharebuyback programme were cancelled. As of 31 December 2017,
the Company held 129,525 treasury shares.

Contribution to Plan Assets of Pension Schemes
The cash outﬂows of € -0.5 billion, € -0.3 billion and € -0.2 billion
in 2017, 2016 and 2015, respectively, primarily relate to acontribution to the Contractual Trust Arrangement (CTA) for
allocating and generating pension plan assets in accordancewith 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”.

OthersIn 2017, the negative amount of € -36 million mainly resulted fromthe bank activities, partly compensated by the realised result
from Treasury swaps and changes in consolidated ﬁnancing
liabilities.
In 2016, the negative amount of € -93 million mainly resulted
from the bank activities, partly compensated by changes in
consolidated ﬁnancing liabilities and changes in securities.

2.1.6.2

Consolidated Cash and Cash
Equivalents and Securities

The cash and cash equivalents and securities portfolio of Airbus
is invested mainly in non-speculative ﬁ nancial 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

REGISTRATION DOCUMENT 201793

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

Financial Statements — Note 35.1: Information about Financial
Instruments — Financial Risk Management”.
Airbus has a partially automated cross-border and domestic cash
pooling system in all countries with major group presence andwhenever country regulations allow such practice (among others
this includes mainly France, Germany, Spain, the Netherlands,
the UK and the US). The cash pooling system enhances
Management’s ability to assess reliably and instantaneously
the cash position of each subsidiary within Airbus and enables
Management to allocate cash optimally within Airbus depending
upon shifting short-term needs.

2.1.6.3

Consolidated Financing Liabilities

The outstanding balance of Airbus’ consolidated ﬁ nancing
liabilities increased from € 10.5 billion as of 31 December 2016
to € 11.2 billion as of 31 December 2017. The increase in bonds
corresponds principally to bonds issued on 10 April 2017, fora total of US$ 1.5 billion, with a 10 year-maturity tranche of
US$ 750 million at ﬁ xed coupon of 3.150%, and a 30 yearmaturity tranche of US$ 750 million at a ﬁxed coupon of 3.950%.
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

Airbus favours cash sales and encourages independent
ﬁ nancing by customers, in order to avoid retaining credit orasset risk in relation to delivered products. However, in order tosupport product sales, primarily at Airbus Commercial Aircraft
and Airbus Helicopters, Airbus may agree to participate in theﬁ nancing of customers, on a case-by-case basis, directly or
through guarantees provided to third parties.
The financial markets remain unpredictable, which may
cause Airbus to increase its future outlays in connection withcustomer ﬁ nancing of commercial aircraft and helicopters,
mostly through ﬁ nance leases and secured loans and if
deemed necessary through operating lease structures.
Nevertheless, Airbus intends to keep the amount as low as
possible.
Dedicated and experienced teams structure such ﬁ nancing
transactions and closely monitor total ﬁnance and asset value
exposure of Airbus and its evolution in terms of quality, volume
and intensity of cash requirements. Airbus aims to structure all
ﬁnancing it provides to customers in line with market-standard
contractual terms so as to facilitate any subsequent sale or
reduction of such exposure.

EVOLUTION OF AIRBUS COMMERCIAL AIRCRAFT GROSS EXPOSURE DURING 2017 IN US$ MILLIONS

1,657

31 December 2016

726

Additions

Disposals-724

Amortisation-143

31 December 2017

Airbus Commercial Aircraft gross customer ﬁnancing exposure
as of 31 December 2017 is distributed over 52 aircraft, operated
at any time by approximately 13 airlines. In addition, the levelof exposure may include other aircraft-related assets, such as
spare parts. More than 90% of Airbus Commercial Aircraft grosscustomer ﬁnancing exposure is distributed over 8 countries (thisexcludes backstop commitments).
Over the last three years (2015 to 2017), the average number ofaircraft delivered in respect of which ﬁnancing support has been
provided by Airbus Commercial Aircraft amounted to 1% of the

1,516

average number of deliveries over the same period, i.e. 8 aircraft
ﬁnanced per year out of 680 deliveries per year on average.
Airbus Helicopters’ gross customer financing exposureamounted to € 137 million as of 31 December 2017. This exposure
is distributed over 63 helicopters, operated by approximately
5 companies.
For further information, please refer to the “Notes to the IFRS
Consolidated Financial Statements — Note 25: Sales Financing
Transactions”.

2

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Registration Document 2017 - AIRBUS
Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.2 Financial Statements

2.1.7 Hedging Activities

More than 75% of Airbus’ 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 Airbus does not use ﬁnancial instruments to hedge its net
current and future exchange rate exposure from the time of acustomer order to the time of delivery, its proﬁts will be affectedby market changes in the exchange rate of the US dollar against
these currencies, and to a lesser extent, by market changes inthe exchange rate of pound sterling against the euro.
As Airbus intends to generate proﬁts only from its operations
and not through speculation on foreign currency exchange rate
movements, Airbus uses hedging strategies solely to mitigate
the impact of exchange rate ﬂuctuations on its EBIT.

The table below sets forth the notional amount of foreign exchange hedges in place as of 31 December 2017, and the average
US dollar rates applicable to corresponding EBIT.

Total Hedges (in US$bn)

2018

2019

2020

2021

2022+

Total

24.5

25.1

22.4

13.0

3.7

88.7

Forward Rates (in US$)
€/US$

1.25

1.24

1.22

1.23

1.24

£/US$

1.53

1.46

1.37

1.36

1.36

For further information on Airbus’ 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.”

2.2 Financial Statements
The IFRS Consolidated Financial Statements and the Company
Financial Statements of Airbus SE for the year ended
31 December 2017, 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:■
T he IFRS Consolidated Financial Statements and theCompany Financial Statements of Airbus Group SE for theyear ended 31 December 2016, together with the related
notes, appendices and Auditors’ reports, as incorporated byreference in the Registration Document ﬁled in English with,and approved by, the AFM on 4 April 2017 and ﬁled in English
with the Chamber of Commerce of The Hague.

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 > Annual
Reports and Registration Documents).
Copies of the above-mentioned Registration Documents
are also available in English on the website of the AFM on
www.afm.nl (Professionals > Registers > Approved
prospectuses). The above-mentioned ﬁ nancial statements
are also available in English for inspection at the Chamber ofCommerce 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.

REGISTRATION DOCUMENT 201795

Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.4 Information Regarding the Statutory Auditors

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

2
2.4 Information Regarding the Statutory
Auditors
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

28 April 201611 April 2018

* A resolution will be submitted to the Annual General Meeting of Shareholders in 2018, in order to appoint Ernst & Young Accountants LLP as the Company’s auditors for the2018 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).

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Chapter

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General Descriptionof the Company
and its Share Capital3

3.1 General Description of the Company

98

3.1.1 Commercial and Corporate Names, Seat and Registered Ofﬁce
3.1.2 Legal Form
3.1.3 Governing Laws and Disclosures
3.1.4 Date of Incorporation and Duration of the Company
3.1.5 Objects of the Company
3.1.6 Commercial and Companies Registry
3.1.7 Inspection of Corporate Documents
3.1.8 Financial Year3.1.9 Allocation and Distribution of Income
3.1.10 General Meetings
3.1.11 Disclosure of Holdings
3.1.12 Mandatory Disposal
3.1.13 Mandatory Offers

98
98
98
100
100
100
100
100
101
101
102
104
105

3.2 General Description of the Share Capital

105

3.2.1 Issued Share Capital
3.2.2 Authorised Share Capital
3.2.3 Modiﬁcation of Share Capital or Rights Attached to the Shares
3.2.4 Securities Granting Access to the Company’s Share Capital
3.2.5 Changes in the Issued Share Capital

105
105
106
107
107

3.3 Shareholdings and Voting Rights

108

3.3.1 Shareholding Structure at the End of 2017
3.3.2 Relationships with Principal Shareholders
3.3.3 Form of Shares
3.3.4 Changes in the Shareholding of the Company
3.3.5 Persons Exercising Control over the Company
3.3.6 Simpliﬁed Group Structure Chart
3.3.7 Purchase by the Company of its Own Shares

108
109
111
112
112
112
114

3.4 Dividends

116

3.4.1 Dividends and Cash Distributions Paid
3.4.2 Dividend Policy of the Company
3.4.3 Unclaimed Dividends
3.4.4 Taxation

116
116
116
116

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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 Ofﬁce

Commercial 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 seat in Amsterdam, The Netherlands and registeredwith the Dutch Commercial Register (Handelsregister) under number 24288945. As a company operating worldwide, the Company
is subject to, and operates under, the laws of each 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 ten years.
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; and■publishing 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.

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

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.

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.

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 quarterly reports which may be prepared in English only.
In addition, pursuant to the Exchange Rules, the Company
is required to publish a ﬁnancial calendar at the beginning ofeach ﬁnancial year in German and English. The Company isalso required to hold an analysts’ meeting at least once per
year in addition to the press conference regarding the annual
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.

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
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 deﬁ ned above will be disclosed
simultaneously in Spain by filing the relevant regulatory
announcement (hecho relevante) with the CNMV.
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.

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

3.1.4 Date of Incorporation and Duration of the Company

The Company was incorporated on 29 December 1998 for an unlimited duration.

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:

the aeronautic, defence, space and/or communicationindustry; or■
activities that are complementary, supportive or ancillary
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 Airbus (2, rond-point Emile
Dewoitine, 31700 Blagnac, France, Tel.: +33 5 81 31 75 00).

In Germany, the Articles of Association are available at theMunich ofﬁce of Airbus (Willy-Messerschmitt-Strasse 1, 82024
Ottobrunn, Germany, Tel.: +49 89 60 70).
In Spain, the Articles of Association are available at the CNMV
and at the Madrid ofﬁce of Airbus (Avenida de Aragón 404,
28022 Madrid, Spain, Tel.: +34 91,585 70 00).

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

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

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.

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.

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 ten weeks before the Meeting. A matter
which one or more shareholders or other parties with meetingrights 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 shallbe announced in the same fashion, if the substantiated request

or a proposal for a resolution is received by the Company no later
than the 60th day before the general meeting. When exercising
the right to put a matter on the agenda for a General Meeting of
Shareholders, the respective shareholder or shareholders are
obliged to disclose their full economic 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 be appointed for eachshare.
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.

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3.1 General Description of the Company

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.
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. The use of such electronic means will
depend on the availability of the necessary technical means
and market practice.

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
is required 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.

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 interest in the capital or voting rightsof the Company must immediately give written notice to the AFM
by means of a 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 or
voting rights of the Company meets, exceeds or falls below one

or several of the above-mentioned thresholds due to a change in
the Company’s outstanding capital, or in voting rights attachedto 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 the Company. Among otherthings, 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.

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

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
beneﬁ t 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 Ofﬁcerof the Company and the competent ﬁnancial market authorities
with respect to certain transactions. The ITR Compliance Ofﬁcer
is responsible for the implementation of the Insider Trading
Rules.
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.

(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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3.1 General Description of the Company

3.1.12 Mandatory Disposal
3.1.12.1 Mandatory Disposal Threshold
Restricting Ownership to 15%
The Articles of Association prohibit any shareholder from holding
an interest of more than 15% of the share capital or voting rightsof the Company, 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 that cause 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 instanceby disposing of its Excess Shares, within two weeks. 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 theend of such two-week period, their Excess Shares would betransferred to a Dutch law foundation (“Stichting”), which can,and eventually must, dispose of them.
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 their
afﬁliates (see “— 3.1.12.2 Exemptions from Mandatory Disposal
Threshold”) and any holder of depositary receipts and their
afﬁliates (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);■
the foundation has no discretion as to the exercise of voting
rights 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; and■no 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 the datewhen the current Articles of Association entered into force (the“Exemption Date”).
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.

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General Description of the Company and its Share Capital
3.2 General Description of the Share Capital

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 abid, 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 inconcert (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 other available
exemptions that are provided under Dutch law, the requirement
to make a public offer does not apply to persons, who at thetime the Takeover Act came into force, already held – individuallyor acting in concert – 30% or more of the voting rights in the
Company. In the case of such a concert, a new Member ofthe concert can be exempted if it satisﬁes certain conditions.

3.2 General Description of the Share
Capital3.2.1 Issued Share Capital

As of 31 December 2017, the Company’s issued share capital amounted to € 774,556,062, consisting of 774,556,062 fully paid-up
shares of a nominal value of € 1 each.

3.2.2 Authorised Share Capital

As of 31 December 2017, the Company’s authorised share capital amounted to € 3 billion, consisting of 3 billion shares of € 1 each.

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General Description of the Company and its Share Capital
3.2 General Description of the Share Capital

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 thanﬁ ve years, to issue shares and to determine the terms andconditions of share issuances.
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 shares issued forconsideration other than cash and shares issued to employeesof Airbus. For the contractual position as to pre-emption rights,
see “— 3.3.2 Relationships with Principal Shareholders”.
The 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 a 75% voting
majority is required for any shareholders’ resolution to issue
shares or to grant rights to subscribe for shares if the aggregate
issue price is in excess of € 500 million per share issuance, andno preferential subscription rights exist in respect thereof. The
same voting majority requirement applies if the shareholders’meeting wishes to designate the Board of Directors to have theauthority to resolve on such share issuance or granting of rights.
Pursuant to the shareholders’ resolutions adopted at theAGM held on 12 April 2017, 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:
1. employee Share Ownership Plans and share-related LongTerm Incentive Plans, provided that such powers shall belimited to 0.14% of the Company’s authorised share capital;
and
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 2017, and shall not extend to issuing shares or
granting rights to subscribe for shares (i) if 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
corporate body) and (ii) for an aggregate issue price in excessof € 500 million per share issuance.
At the AGM held on 12 April 2017, 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’meeting 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 12 April 2017, 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.

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General Description of the Company and its Share Capital
3.2 General Description of the Share Capital

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 2017
were exercised:

Total number of Company shares issued as of 31 December 2017
Total number of Company shares which may be issued
following exercise of the convertible bonds

Total potential Company share capital

Numberof shares

Percentage ofdiluted capital

Number of
voting rights

Percentage ofdiluted voting
rights(1)774,556,062

99.356%774,426,537

99.356%

5,022,990

0.644%

5,022,990

0.644%

100% 779,449,527

100%

779,579,052(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”.

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

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

In 2013

Issue of shares following exercise
of options granted to employees(2)In 2014Issue of shares following exercise
of options granted to employees(2)In 2015

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

In 2015

Issue of shares following exercise
of options granted to employees(2)In 2016

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€1

2,448,884-

776,283,958€ 776,283,958€1

6,873,677€ 176,017,918

783,157,635€ 783,157,635€1

1,871,419€ 50,619,684

784,780,585€ 784,780,585€1

2,885,243-

785,333,784€ 785,333,784€1

1,910,428-

785,344,784€ 785,344,784

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(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 2017, a total number of 1,643,193 new shares were issued, all in the framework of the Employee Share Ownership
Plan (“ESOP”). During 2017, (i) the Company did not repurchase any shares and (ii) none of the treasury shares were cancelled.
As a result, as at 31 December 2017, the Company held 129,525 treasury shares.

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Registration Document 2017 - AIRBUS
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 2017

As of 31 December 2017, the French State held 11.08% of theoutstanding Company shares through Sogepa, the German
State held 11.07% through GZBV, a subsidiary of Kreditanstalt
für Wiederaufbau (“KfW”), a public law institution serving
domestic and international policy objectives of the Governmentof the Federal Republic of Germany, and the Spanish State held
4.17% through SEPI. The public (including Airbus’ employees)

and the Company held, respectively, 73.66% and 0.02% of theCompany’s share capital.
The diagram below shows the ownership structure of theCompany as of 31 December 2017 (% 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 2017

FRENCHSTATEGERMANSTATE

SPANISHSTATEOTHER GERMAN
PUBLIC ENTITIES

15.69%PUBLIC

KfW

84.31%

SOGEPASEPIGZBV(2)

11.08%(11.08%)4.17%(4.17%)

11.07%(11.07%)73.68%(1)(73.67%)

Share subject to Shareholders’ Agreement

AIRBUS SE(1) Including shares held by the Company itself (0.02%).
(2) KfW & other German public entities.

In 2017, the below listed entities have notiﬁed the AFM of theirsubstantial interest in the Company. For further details, pleaserefer to the website of the AFM at: www.afm.nl:■
Capital Group International Inc. owns 10.06% of the voting
rights via Capital Research and Management Company.

own shares, equal to 0.02% of issued share capital. The treasury
shares owned by the Company do not carry voting rights.

As of 31 December 2017, the Company held, directly or indirectly
through another company in which the Company holds directly
or indirectly more than 50% of the share capital, 129,525 of its

Approximately 2.0% of the share capital (and voting rights) was
held by the Company’s employees as of 31 December 2017.

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”.

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

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.

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

Grandfathering Agreement

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.

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.

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.

Individual Grandfathering Rights

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.

3.3.2.2 Core Shareholder Arrangements

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

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

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Registration Document 2017 - AIRBUS
General Description of the Company and its Share Capital
3.3 Shareholdings and Voting Rights

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.

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

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 shall
exercise 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 Memberof the Board of Directors of the Company, provided such
person qualiﬁ es as an Independent Director pursuant to theconditions set forth in the Board Rules, and shall vote asshareholders in any shareholders’ meeting in favour of suchappointment and against 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 / havebeen terminated, KfW or Sogepa, as the case might be, shallpropose 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
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.

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 to acting
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 to acting
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.

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111

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 their
afﬁliates, 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 corporateofﬁcers 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
The Company entered into an agreement with the French State
pursuant to which the Company would:■
grant the French State a right of ﬁrst offer in case of the saleof all or part of its shareholding in Dassault Aviation; and■commit 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 “— Informationof Airbus 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.

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Registration Document 2017 - AIRBUS
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 the past three years is set forth in the tablebelow:
Position as of
31 December 2017

Position as of
31 December 2016

Position as of
31 December 2015

Shareholders% ofcapital% ofvotingrightsNumber ofshares% ofcapital% ofvotingrightsNumber ofshares% ofcapital% ofvotingrightsNumber ofsharesSOGEPA11.08%

11.08%

85,835,477

11.11%

11.11%

85,835,477

10.93%

10.95%

85,835,477

GZBV

11.07%

11.07%

85,709,822

11.09%

11.09%

85,709,822

10.91%

10.93%

85,709,822

SEPI

4.17%

4.17%

32,330,381

4.18%

4.18%

32,330,381

4.12%

4.12%

32,330,381

Sub-total New
Shareholder Agt.

26.32%

26.33%

203,875,680

26.38%

26.38%

203,875,680

25.96%

26.01%

203,875,680

Foundation“SOGEPA”

0.00%

0.00%

-

0.00%

0.00%

0

0.00%

0.00%

0

(1)

(2)

73.66%

73.67%

570,550,857

73.60%

73.62%

568,853,019

73.85%

73.99%

579,995,047

Own sharebuyback(3)

0.02%

-

129,525

0.02%-

184,1700.19%-

1,474,057

Total

100%

100% 774,556,062

100%

100%

772,912,869

100%

Public100% 785,344,784(1) KfW & other German public entities.
(2) Including Company employees. As of 31 December 2017, 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 the
beneﬁ cial holders of its shares held by identiﬁ able holders(“Titres au porteur identifiables”) holding 2,000 or more shares
each. The study, which was completed on 31 December 2017,
resulted in the identiﬁcation of 1,893 shareholders holding a totalof 569,727,245 Company shares (including 1,858,501 shares
held by Iberclear on behalf of the Spanish markets and25,517,394 shares held by Clearstream on behalf of the Germanmarket).
The shareholding structure of the Company as of 31 December
2017 is as shown in the diagram in “— 3.3.1 Shareholding
Structure at the end of 2017”.

3.3.5 Persons Exercising Control over the Company

See “— 3.3.1 Shareholding Structure at the end of 2017” 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 2017, comprising three Divisions
and the main Business Units. See “— Information on Airbus Activities — 1.1.1 Overview — Organisation of Airbus’ Businesses”.
For ease of presentation, certain intermediate holding companies have been omitted.

Infoterra Limited(UK)

Airbus Operations
Limited(UK)

AirbusOperations, S.L.
(Spain)Paradigm
Services Limited(UK)

MBDA Group

ArianeGroup

Airbus Helicopters

Airbus Defence
and Space
Limited(UK)

Premium Aerotec
GmbH(Germany)

Airbus Operations
GmbH(Germany)

Airbus Operations
SAS(France)

Airbus Defence and SpaceElbe
FlugzeugwerkeGmbH(Germany)

45%

Airbus Defence 11,98%
and Space, GmbH
(Germany)

24,20%

Airbus Group
Limited(UK)

Subsidiaries held with no indication of ownership percentage are 100% owned.
Legal forms are indicated for information purposes and are not always part of the legal name.

*Airbus owns indirectly 50% of ATR GIE, 50% of ArianeGroup and 37.50% of MBDA Group.

50%

13,73%DADC Luft-und
Raumfahrt
Beteiligungs GmbH
(Germany)

Airbus Group
Inc.
(USA)

Airbus Americas
Inc.
(USA)

Airbus DS
Holdings B.V.
(The Netherlands)(The Netherlands)

AIRBUS SE

50%*

4,59%

Airbus Defence
and Space SAS(France)

37,5%*

Airbus Defence
and Space HoldingSAS
95,96%(France)

Stelia Aerospace(France)

ATR GIE(France)

Airbus SAS(France)

90,43%

Airbus Defence
and Space Holding 50%
France SAS
99,99%(France)

4,04%

4,97%

SIMPLIFIED GROUP STRUCTURE CHART

ArianeGroup

MBDA Group

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

Computadoras,Redese Ingenieria, S.A.
(Spain)Airbus Helicopters(France)

Airbus Helicopters
DeutschlandGmbH(Germany)

5%

95%

Airbus Helicopters
Holding(France)

EADS Casa
France(France)

EADS Casa
Holding(France)

Airbus Defence
and Space, S.A.
(Spain)REGISTRATION DOCUMENT 2017
113

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

3

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Registration Document 2017 - AIRBUS
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 12 April 2017, see “— 3.2.3
Modiﬁcation of Share Capital or Rights Attached to the Shares”.

3.3.7.2

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.
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.

3.3.7.3

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.

3.3.7.4

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

Description of the Share Repurchase
Programme to be Authorisedby the Annual General Meetingof Shareholders to be Held on
11 April 2018

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: 11 April 2018;■
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 ﬁ nancial instruments convertible into
Airbus SE shares, or (ii) employee share option programmes
or other allocations of shares to employees of Airbus andAirbus’ companies,■■

REGISTRATION DOCUMENT 2017

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

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;■
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: 77,455,606 shares, based on an issued sharecapital of 774,556,062 shares as of 28 February 2018,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.
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 2017
On 28 February 2018, the Company started implementing ashare buyback programme that was conferred by Board of
Directors on 14 February 2018 following the authorisation by
the Company’s Annual General Meeting of shareholders on
12 April 2017. This share buyback programme is reported inaccordance with the Market Abuse Regulation.

3

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Registration Document 2017 - AIRBUS
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)2013

3 June 2014

€ 0.752014

3 June 2015

€ 1.202015

3 May 2016

€ 1.302016

20 April 2017

€ 1.35(1) Note: figures have not been adjusted to take into account changes in the number of shares outstanding.

3.4.2 Dividend Policy of the Company
In December 2013, Airbus 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 € 3.71 and a net income of € 2.873 million, the Board of Directors will propose to the AGM
the payment to shareholders on 18 April 2018 of a dividend of € 1.50 per share (FY 2016: € 1.35). This value is at the upper end of
the dividend policy reﬂecting our strong 2017 achievements, including the positive evolution of the 2017 underlying performanceand our 2017 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 should be 17 April 2018. This proposed dividend represents year-on-year dividend per share increase of 11.1%.

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

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 2017

117

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.
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.

Withholding Tax on Sale or Other Dispositionsof Shares
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.

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

the Non-Resident Holder is an individual and such holder ora connected person to such holder (“verbonden persoon”)
has, directly or indirectly, a substantial interest (“aanmerkelijk
belang”) or a deemed substantial interest in the Company; or■the 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 asset management (normaal actief vermogensbeheer).
■

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.

Gift or Inheritance Taxes
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.

Value Added Tax
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.

3

118

Registration Document 2017 - AIRBUS

Chapter

4

REGISTRATION DOCUMENT 2017

119

Corporate
Governance4
4.1 Management and Control

120

4.1.1
4.1.2
4.1.3
4.1.4

120
140
141
143

Corporate Governance Arrangements
Dutch Corporate Governance Code, “Comply or Explain”
Enterprise Risk Management System
Internal Audit

4.2 Interests of Directors and Principal Executive Ofﬁcers

144

4.2.1 Remuneration Policy
4.2.2 Long-Term Incentives Granted to the Chief Executive Ofﬁcer
4.2.3 Related Party Transactions

144
154
155

4.3 Employee Proﬁt Sharing and Incentive Plans

155

4.3.1 Employee Proﬁt Sharing and Incentive Agreements
4.3.2 Employee Share Ownership Plans
4.3.3 Long-Term Incentive Plans

155
155
157

120

Registration Document 2017 - AIRBUS
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
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 Board of
Directors, and the Board of Directors in its resolutions proposedto the shareholders’ meeting regarding proposals to appoint or
replace a resigning or incapacitated Director, are both required
to apply the following 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 the four Member States of the EU where thesemain industrial centres are located); and■at 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 shallseek greater diversity with respect to gender, age, geography,
education, profession and background.
In 2017, one new member joined the Board of Directors, Lord
Drayson. He has the competencies and personal skills to fulﬁlthis position in line with the Board’s expectations and theevolution of the business within the Company. As an engineer
and entrepreneur, he brings amongst other qualities the rightexpertise for our innovation focus and digital journey. Following
the replacement of Mr. Mittal by Lord Drayson, the Company
will strive to ﬁnd a new Board Member with an Asian proﬁle.

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Corporate Governance
4.1 Management and Control

At the end of 2017 half of the Members of the Board of
Directors were under the age of 60. The proportion of female
representation is today at 25% against 0% ﬁve years ago. The
Board composition shows a balanced mix of experience with,for example, four Members having Defence industry skills,
six having geopolitical or economics skills or four having
information or data management skills. More details as to thediversity of the Board of Directors Members are available in
the table shown below.
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 (i) two of the Directors submitted
to the shareholders for appointment 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 of the Directors submitted to the shareholders
for appointment should also be German Defence Outside
Directors (as deﬁned above) of the German Defence Holding
Company (as deﬁned above) who have been proposed by theCompany 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 upsuch schedule, the RNGC considers the continuity of companyspeciﬁc knowledge and experience within the Board of Directors
while it takes into account that a Director should at the time of his
appointment or re-appointment not be older than 75 years andensuring that at least one third of Directors’ positions are either
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 and integration
challenges, provided that exceptions to these rules may be
agreed by the Board of Directors if speciﬁ c 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 of the Directors (a “Simple Majority”),
but certain decisions must be made by a 2/3 majority (i.e.
eight favourable votes) of the Directors regardless of whether
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 Boardof Directors, with no more than one Director not being present
or represented (including provisions relating to nationality
and residence requirements with respect to Members of theBoard of Directors and the Executive Committee). However,no individual Director or class of Directors has a veto right withrespect 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
and deciding upon the appointment and removal of theSecretary to the Board of Directors on the basis of therecommendation of 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; and■approving decisions in respect of other measures andbusiness of fundamental signiﬁ cance for Airbus or which
involves an abnormal level of risk.

4

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Registration Document 2017 - AIRBUS
Corporate Governance
4.1 Management and Control

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 ten 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 called meeting.

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 their duties
and avoiding any and all conﬂicts of interest.

REGISTRATION DOCUMENT 2017123

Corporate Governance
4.1 Management and Controlc) The Board of Directors in 2017(i) Composition of the Board of Directors in 2017
AIRBUS SE BOARD OF DIRECTORS
Committee membership
Current
term
expires Director expertise

Primaryoccupation
Status & Other mandates

Board
attendance

Name

Age

Since

Denis
RANQUE66

2013, last
re-election
in 20172020

I

Chairman of the Boardof Directors of Airbus SE

9/9

10/10

59

2012, last
re-election
in 2016

2019

E

Chief Executive Ofﬁcerof Airbus SE

9/9

3/5

70

2013, last
re-election
in 2017

I

Member of the Board of
Directors of American
Electric Power Corp.

9/9
7/7
(from
AGM 2017)

ThomasENDERS

Ralph D.
CROSBY, JR.

Lord
DRAYSON(Paul)

2020

Audit

57

2017

2020

I

Catherine
GUILLOUARD 53

2016

2019

I

Chief Executive Ofﬁcer
of RATP

8/9

Hans-Peter
KEITEL70

2013,
re-election
in 20162018

I

Former CEO of
HOCHTIEF AG

7/9

62

2007, last
re-election
in 2017I

Former Member of theManagement Board of
Deutsche Bank AG

8/9

6/6

9/9

2/2

5/6

2020

AmparoMORALEDA*

53

2015,
re-election
in 2018

2018

I

Member of the Boardof Directors of Solvay,
CaixaBank andVodafone

Claudia
NEMAT

49

2016

2019

I

Member of the Boardof Management of
Deutsche Telekom AG

8/9

75

2007, last
re-election
in 20162018

I

Chairman of Anglo
American PLC

7/9

I

Chairman of theManaging Boardof Peugeot SA

7/9

I

Honorary Governor of
Banque de France
Former President of theEuropean Central Bank

Sir John
PARKER

CarlosTAVARES

Jean-Claude
TRICHET

59

2016

2019

2012, last
re-election
in 2016

75

2018

4

7/7

4/6

5/7

8/9

9/9
9 meetings
91%
attendance
rate

ECC**

3/4

Co-Founder, Chairman
and CEO of Drayson
Technologies Ltd

HermannJosef
LAMBERTI

RNGC

7/10

7/7

7/7

9/9

9/10

9/9
6 meetings 9 meetings
92%
83%
attendance attendance
rate
rate

10 meetings85%
attendance
rate

Status as of 14 February 2018.
* To be re-elected in 2018.
** Ethics & Compliance Committee (ECC) replaced the temporary AdHoc Committee in July 2017.
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.

ChairmanGlobalBusiness

I: Independent E: Executive

Engineering& Technology

Manufacturing& Production

AerospaceIndustry

Finance& Audit

Geopolitical
Economics

DefenceIndustry

Information& Data Management

Asia

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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 Members of
the Board of Directors in 2017
Denis Ranque

66 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 the
afﬁliate 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 position in
May 2009, as a consequence of a change in shareholding. From February 2010 to June 2012 he has been
Non-Executive Chairman of Technicolor. Since October 2001, he has also been Chairman of the Boardof the École des Mines ParisTech, and since September 2002, Chairman of the Cercle de l’Industrie, anassociation which unites France’s biggest industrial companies; both mandates ended in June 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 ofcorporate governance for monitoring and encouraging progress in this ﬁeld. From2014 to 2017 he has
also been co-Chairman of La Fabrique de l’industrie, a think tank dedicated to industry. Since 2014 heis the Chairman of the Fondation de l’École Polytechnique and a member of the French Academy forTechnologies (“Académie des Technologies”). Denis Ranque, born 1952, is a graduate of France’s École
Polytechnique and the Corps des Mines.

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:- Member of the Board of Directors of Scilab Enterprise SAS;
- President of the French Haut Comité de Gouvernement d’Entreprise;- Co-Chairman of the Board of Directors of La Fabrique de l’industrie.

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Ralph Dozier Crosby, JR.

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

Curriculum Vitae
Ralph Crosby was Member of the Executive Committee of EADS from 2009-2012 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 Serco, headquartered in London, United Kingdom. Furthermore, Mr Crosby serves on
the Board of Directors, and Executive Committee of the Atlantic Council of the United States. Prior tojoining EADS, Mr Crosby was an 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 andCorporate Vice President and General 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 assistantto the Vice President of the United 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 the James Forrestal Award from the National Defense Industrial Association, andhas been awarded Chevalier of the Legion 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 and of the Executive Committee of the Atlantic Council of theUnited States.
Former mandates for the last ﬁve years:- Member of the Board of Directors (Supervisory Board) of Ducommun Corporation(resigned June 2013);- Member of the Board of Directors (Supervisory Board) of Serco Group plc (until June 2017).

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57 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 hebecame Managing Director of The Lambourn Food Company Limited, a subsidiary of the Trebor Group
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 and led its
business as Chairman and CEO until it was sold to Chiron Corporation, a US company, in 2003. He cofounded 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;- Science Entrepreneur in Residence of Magdalen College, Oxford;- Supernumerary Fellow of St. John’s College, Oxford;- Member of Project of the “Oxfordshire Innovation Engine” Project;- 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:- Scientiﬁc Advisor Formula E Championship (until January 2013);- Co-founder and Managing Partner Drayson Racing Technologies LLP (until April 2014);- President of the Motorsports Industry Association (until October 2015);- Non-Executive Director and Board Member of the Royal Navy (until November 2017);- 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).

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Thomas Enders

59 years old
Director since 2012,
last re-elected in 2016
Executive

Curriculum Vitae
Dr. Thomas (“Tom”) Enders was appointed Chief Executive Ofﬁcer (CEO) of Airbus SE, on 1 June 2012,
after having been CEO of the Airbus Commercial Aircraft Division since 2007. Before that he served as
Co-CEO of EADS between 2005 and 2007. He was Head of the Group’s Defence Division from 2000 to
2005. He has been a member of the Executive Committee of Airbus since its creation in 2000.
Prior to joining the aerospace industry in 1991, Enders worked, inter alia, as a Member of the “Planungsstab”
of the German Minister of Defence and in various Foreign Policy think tanks. He studied Economics,
Political Science and History at the University of Bonn and at the University of California in Los Angeles.
In 2014, Enders joined the Advisory Council of the Munich Security Conference as well as the Senate of
the Max-Planck-Gesellschaft. He is patron of the German Mayday Foundation which supports airmen,
women and their families in times of need.
Tom Enders is a member of the BDI Board (German Industry Association) since 2009, the Governing Boardof HSBC Trinkhaus since 2012, the Joint Advisory Council of Allianz SE since 2013 and the Supervisory
Board of Linde AG since 2017.

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;- Chairman of the Shareholder Board of Airbus SAS;
- Chairman of the Supervisory Board of Airbus Helicopters SAS;
- Chairman of the Supervisory Board of Airbus DS Holding B.V.;- Chairman of the Supervisory Board of Airbus Defence and Space Deutschland GmbH;- Member of the Board of Directors of BDI (Federation of German Industry);- Member of the Governing Board of HSBC Trinkhaus;- Member of the International Advisory Board of Atlantic Council of the US;- Member of the Joint Advisory Council of Allianz SE;- Member of the Board of Directors of WORLDVU Satellites Ltd. (OneWeb);- Member of the Supervisory Board of Linde AG;- Member of the Advisory Counsel of EDB.
Former mandates for the last ﬁve years:- Chairman of the Advisory Council for Aeronautics Research and Innovation in Europe (ACARE)(until June 2013).

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Catherine Guillouard

53 years old

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 VicePresident Finance Controlling in 1999, Senior Vice-President of Flight Operations in 2001, Senior VicePresident of Human Resources and Change Management in 2003 and Senior Vice-President of Financein 2005. In September 2007, she joined Eutelsat as Chief Financial Ofﬁcer and member of the Group
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 ofRexel. Catherine Guillouard, born in 1965, is a graduate of the Institute of Political Studies of Paris andthe École Nationale d’Administration and she has a PhD of European laws (Panthéon-Sorbonne).

Director since 2016
Independent

Current Mandates:- Member of the Board of Directors of Airbus SE;- Member of the Board of Directors of ENGIE;- Chief Executive Ofﬁcer of RATP.
Former mandates for the last ﬁve years:- Deputy Chief Executive Ofﬁcer of Rexel (until February 2017);- Independent Member of the Board of Directors of Technicolor (until August 2013);- Independent Member of the Board of Directors of ADP (until September 2013).

Hans-Peter Keitel
Curriculum Vitae
Hans-Peter Keitel served as President of the Federation of German Industries (BDI) from 2009 to 2012.
Prior to this he served nearly 20 years at Hochtief – ﬁrst as Director and Board member for International
Business and subsequently from 1992 to 2007 as Chief Executive Ofﬁcer. From 1992 until 1999 he was
Member of the Executive Board of Hochtief’s mother company, RWE AG. He started his career in 1975
at Lahmeyer International as a technical advisor and project manager being involved in large scale global
infrastructure projects in over 20 countries. He also advised the arranging banks of the Channel Tunnel
Consortium. Mr Keitel graduated from the Universities of Stuttgart and Munich in Construction Engineeringand Economics and has received a PhD in Engineering from the University of Munich.
70 years old
Director since 2013,
re-elected in 2016
Independent

Current Mandates:- Member of the Board of Directors of Airbus SE;- Member of the Supervisory Board of RWE AG;- Chairman of the Supervisory Board and the Shareholders Committee of Voith KGaA;- Member of the Supervisory Board of ThyssenKrupp AG;- Deputy Chairman of the Supervisory Board of National-Bank AG.
Former mandates for the last ﬁve years:- Member of the Supervisory Board of Deutsche Messe AG (until 2013).

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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.
62 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);- Member of the Managing Committee of Institut für Wirtschaftsinformatik der HSG Universität
St. Gallen (until December 2013);- Member of the Board of Trustees of Frankfurt International School e.V (until December 2013);- Member of the University Council of University of Cologne (until June 2013);- Member of the Steering Committee and of the Federal Committee Wirtschaftsrat der CDU e.V.
(until June 2013);- Member of the Supervisory Board of Carl Zeiss AG (until March 2013);

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María Amparo Moraleda Martínez

53 years old
Director since 2015
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;- 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.
Former mandates for the last ﬁve years:- Member of the Advisory Board of KPMG Spain (until June 2017);- Member of the Board of Directors of Faurecia SA (until October 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

49 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 led the unit for Europe,
the Middle East and Africa.
Her main areas of expertise include large-scale strategic and operational turnaround and transformation
programs, digital transformation and industrial politics. Mrs. Nemat has worked in numerous European
countries as well as North and South America. She was a member of the Supervisory Board of Lanxess AG
from 2013 until 2016. Mrs. Nemat has been a member of the Board of Directors of Airbus and a memberof the Supervisory Board of Airbus Defence and Space GmbH since May 2016.
Claudia Nemat studied physics at University of Cologne, where she has also taught at the departmentof Physics and Mathematics.

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).

Sir John Parker
Curriculum Vitae
Sir John Parker is Chairman of Anglo American PLC, Chairman of Pennon PLC, Non- Executive Directorof Carnival PLC and Carnival Corporation. He has completed his term 2011-2014 as President of the Royal
Academy of Engineering. He stepped down as Chairman of National Grid PLC in December 2011. His
career has spanned the engineering, shipbuilding and defence industries, with some 25 years’ experienceas CEO including Harland & Wolff and the Babcock International Group. He also chaired the Court of the
Bank of England between 2004 and 2009. Sir John Parker studied Naval Architecture and MechanicalEngineering at the College of Technology, Queens University, Belfast.
75 years old
Director since 2007,
last re-elected in 2016
Independent

Current Mandates:- Member of the Board of Directors of Airbus SE;- Director of Carnival PLC and Carnival Corporation;- Chairman Anglo American PLC;
- Chairman Pennon Group PLC;
- Director of White Ensign Association Ltd.;- Visiting fellow of the University of Oxford.
Former mandates for the last ﬁve years:- Deputy Chairman of D.P. World (Dubai) (until July 2015);- President of the Royal Academy of Engineering (until September 2014).

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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.

59 years old
Director since 2016
Independent

Current Mandates:- Member of the Board of Directors of Airbus SE;- Director of Banque PSA Finance;- Director of Faurecia SA;- Chairman of the Board of Directors of Peugeot Citroën Automobiles SA;- Member of the Board of Directors of Total Group.
Former mandates for the last ﬁve years:- Manager of Bed&Breakfast in Lisbon (until March 2015);- Director of PCMA Holding B.V. (until October 2014);- Member of the Managing Board of Nissan Alliance (until August 2013);- Chief Operating Ofﬁcer of Renault (until August 2013);- Director of Renault Nissan B.V. (until August 2013);- Director of AvtoVAZ (until August 2013);- Director of Alpine – Caterham (until August 2013).

Jean-Claude Trichet
Curriculum Vitae
Jean-Claude Trichet was President of the European Central Bank, of the European Systemic Risk Boardand of the Global Economy meeting of Central Bank Governors in Basel until the end of 2011. Previously,
he was in charge of the French Treasury for six years and was Governor of Banque de France for ten
years. Earlier in his career, he held positions within the French Inspection Générale des Finances, aswell as the Treasury department, and was advisor to the French President for microeconomics, energy,
industry and research (1978-1981). Mr Trichet graduated from the École des Mines de Nancy, the Institutd’Études Politiques de Paris and the University of Paris in Economics, is a Doctor Honoris Causa of several
universities and an alumnus of the École Nationale d’Administration.
75 years old
Director since 2012,
last re-elected in 2016
Independent

Current Mandates:- Member of the Board of Directors of Airbus SE;- President of JCT Conseil, Paris;- Honorary Governor of Banque de France;- Honorary Chairman of the G30, Washington D.C. (non-proﬁt organisation);- Chairman of the Board of Directors of the BRUEGEL Institute, Brussels (non-proﬁt organisation);- European Chairman of the Trilateral Commission (non-proﬁt organisation).
Former mandates for the last ﬁve years:- Chairman and CEO of G30, Washington D.C. (non-proﬁt organisation) (until December 2016);- President of SOGEPA -Société de Gestion de Participations Aéronautiques- (until 2013).

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Independent Directors

The Independent Directors appointed pursuant to the criteria
of independence set out above are Denis Ranque, Ralph
Crosby, Catherine Guillouard (from AGM 2016), Hans-Peter
Keitel, Hermann-Josef Lamberti, Lakshmi N. Mittal, Maria
Amparo Moraleda Martinez, Claudia Nemat (from AGM 2016),
Sir John Parker, Carlos Tavares (from AGM 2016) and JeanClaude Trichet.
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,
during at least the last ﬁve years. As of the date of this document,
there are no family ties among any of the Directors.

(iii) Operation of the Board of Directors in 2017
Board of Directors Meetings

The Board of Directors met nine times during 2017 and wasregularly informed of developments through business reports
from the CEO, including progress on the strategic and operational
plans. The average attendance rate at these meetings was 91%.
Throughout 2017, the Board of Directors reviewed and discussed
the technical and commercial progress of signiﬁcant new andrunning programmes of the commercial aircraft business,
Defence and Space as well as Helicopters. This comprisedinter alia the remedy of the technical issues hampering theramp-up of the A400M and the A320neo programmes as wellas the efforts to restore the market of the Super Puma helicopter
programme after the safety issues due to accidents. In addition,
the development of the A330neo, the ramp-up and extensionof the A350XWB and the future of the A380 programmes
were closely monitored; in the Defence and Space area thiscomprised the development of unmanned aerial systems aswell as the space business’ next generation launcher Ariane 6
and the OneWeb satellites constellation programme.
Last year’s off-site Board meeting in September in Hamburg wasdedicated to the review of the division and product strategies
and the related business developments as well as the overall
strategy of Airbus. The Board of Directors seized the opportunity
to visit the A320 ﬁnal assembly and A350 subassembly facilities
as well as the A350 Customer Deﬁnition Center and the Centerof Applied Aeronautical Research.
In 2017, the Board of Directors continued to support thedigitalisation initiative, which was started in 2015 to enhance
Airbus ability to identify and capitalise on innovative andtransformational technologies and business models. The
reorganisation and refocusing of the CTO department on its
fundamental tasks of guiding and coordinating overall activities,

developing group-wide roadmaps / demonstrators as well as
technical expertise and blue-sky research was successfully
pursued and delivered already promising results.
The merger of Airbus Group and Airbus brought an overhaul ofthe corporate set-up, simplifying the Company’s governance,
eliminating redundancies and creating further efﬁciencies, whileat the same time driving further integration of the entire group.
Moreover, the Board of Directors reviewed Airbus’ ﬁnancial
results and forecasts and put speciﬁc emphasis on Enterprise
Risk Management supported by a strengthened internal audit
organisation. The corporate social responsibility initiatives were
further focused and renamed “Responsibility and Sustainability”(R&S).
A substantial share of the Board activities was dedicated tocompliance matters. Among other areas, emphasis was put
on further strengthening the Airbus compliance programme,building on the “Business Development Support Initiative” which
was started in 2015. The comprehensive training programme
set up last year continued to further raise awareness, to reducerisks and more generally to improve the culture of integrity ofAirbus. As a consequence of the SFO/PNF investigations, Airbus
has transformed the Ad-Hoc Committee that dealt initiallywith the investigations into a regular Ethics and Compliance
Committee with a wider remit to oversee ethics and compliance.
The Ethics and Compliance Committee will continue to closely
monitor the investigations in view to showing the authorities thecommittee’s thorough and independent approach. In addition,
the “Independent Compliance Review Panel”, composed ofrenowned international experts, was introduced to oversee andbenchmark the respective activities.
The Board of Directors also decided to perform an external
evaluation of the top two tiers of the Executive management inorder to reinforce its appreciation of the Company’s strengthin succession planning and ensure that the right development
plans are in place. In particular, the Board has launched anin-depth succession planning review for the top managementof the Company; following the ﬁrst announcements made in
December 2017, this process will continue in 2018 with theobjective of being ready for the AGM to be held in 2019, given the
CEO’s announcement that he does not intend to seek extensionof his mandate beyond this date.
Board Evaluation 2017

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.

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The year 2017 marked the beginning of a new three-year cycle.
In September 2017, the Board of Directors therefore carriedout an external evaluation based on a questionnaire issued
by a third-party expert and circulated to each Board Member.
The Board of Directors was satisﬁed overall with the continuous
progress made during the ﬁrst three years Board review cycle
and has decided to start a new review cycle with the supportof Heidrick & Struggles as the third-party expert.
Each one of the Board Members had an in-person discussion
with the third-party expert to cover governance, effectivenessand composition of the Board of Directors and the committees,
areas of expertise and working process of the Board of Directors,
relationships between the members of the Board of Directors,
the Chairman, the management, shareholders and stakeholders
as well as scope and composition of topics and preparation
for the future.
Following the last Board review, the Board of Directors spent
additional time on risk management, strategy and othertopics, such as benchmarking on competitors, products
and digital transformation. Notable progress has also been
made in discussions on strategy, risk management and digitaltransformation, with strong leadership coming from the CEO
and the executive team.
In the 2017 evaluation, the Board Members conﬁrmed the needto continue working hard to reinforce cohesiveness as well asteam work within the Board and its Committees, in particular inchallenging times and under signiﬁcant pressure. Some areasof improvement require more attention from the Board suchas: corporate and social responsibility, employee engagement,
industrial strategy and operations efﬁciency and succession
planning.
Board Members notably valued balance of powers, open
debates within the Board of Directors, positive contributionof the Board Committees, creation and performance of the
new Ethics and Compliance Committee and constructive andchallenging interactions between the Board of Directors andthe management, while highlighting that there remains room forfurther progress in this area. The Board of Directors has also
identiﬁed ways to improve effectiveness in the preparation ofBoard meetings, as well as the quality and level of information
provided to the Board Members prior to and between Board
meetings. The induction programme for new Board Members
and off-site Board meetings are also appreciated.
The Board will increase efforts to evaluate the performanceand competitiveness of the Company, increase anticipation ina challenging environment and prepare for the future, notably
from a leadership standpoint.
In addition, the Board Members highlighted the necessity tocontinue with the process of the staggering Board principle,
decided at the 2016 Annual General Meeting. This is intended
to further develop the diversity of expertise, gender andnationalities within the Board of Directors.

4.1.1.2

Board Committeesa) The Audit Committee
The Audit Committee has four (4) Members and is chaired by
an Independent Director who is not the Chairman of the Boardof Directors or a current or former Executive Director of theCompany. The Chaiman 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 accounts, and it monitors the adequacy of Airbus’ internal
controls, accounting policies and ﬁnancial reporting. It also
oversees the operation of Airbus’ Enterprise Risk Management(“ERM”) system and the ethics and compliance organisation.
For further details in this regard, see “— 4.1.3.: Enterprise
Risk Management System”. Please refer to Annex E of theBoard 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 Chief Financial
Ofﬁcer (“CFO”) and the Head Accounting Record to Report
are requested to attend meetings to present management
proposals and to answer questions. Furthermore, the Head ofCorporate Audit & Forensic and the Chief Ethics and ComplianceOfﬁcer are requested to report to the Audit Committee on aregular basis.
In 2017, it met six times with an average attendance rate of
83%, it discussed all of the above-described items during themeetings and it fully performed all of the above-described
duties.

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. The
E&C Committee replaced a temporary Ad-Hoc Committee thatwas created in 2016 in respect of similar matters. Pursuant to theBoard Rules the main mission of the E&C Committee is to assist
the Board in monitoring Airbus’ culture and commitment to ethicalbusiness and integrity. This committee is empowered to oversee
Airbus’ ethics and compliance programme, organisation andREGISTRATION DOCUMENT 2017135

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framework for an effective ethics and compliance governance(including all associated internal policies, procedures andcontrols), which 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 thechairman 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 Ofﬁ cer, who isrequested to provide periodic reports on its activities.
The Chairman of the Audit Committee and the Chairman 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 2017, the E&C Committee and its predecessor, the
Ad-Hoc Committee, met in total ten times with an averageattendance rate of 85%. All of the above described items werebeen discussed during the meetings. Both, the E&C Committee
and the temporary Ad-Hoc Committee fully performed all theabove-described duties.

c) The Remuneration, Nomination and
Governance Committee
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:■
the Chairman of the Board of Directors;■
a current or former Executive Director of the Company;■a Non-Executive Director who is an Executive Director withanother listed company; or■a Director appointed to the Board of Directors on the basisof 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 Chairman of the Board of Directors and the CEO are invited
to attend 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 top talents, discusses measures
to improve engagement and to promote diversity, reviews
the remuneration of the Executive Committee Members, theLong-Term Incentive Plans (“LTIP”), and the variable pay forthe 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 2017,
it met nine times with an attendance rate of 92%, 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 the four Member States of the EU where thesemain industrial centres are located); and

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at least 2/3 of the Members of the Executive Committee,
including the CEO and the Chief Financial Ofﬁcer (“CFO”),
being EU nationals and residents.

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 seeks regularly
advice from its core executive management team (“EMT”), which
comprises some of the Executive Committee Members, on
Airbus-wide topics such as corporate matters or major ongoingprojects as well as on business development and performance
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.

c) The Executive Committee in 2017
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:■
appointment by the heads of the Airbus Divisions and functionsof their management teams;■
major investments/divestments;■
settling up and control of the implementation of the strategy
for Airbus’ businesses;■
Airbus policy matters and management and organisational
structure of the business;■
definition of the Company’s financial performance andbusiness performance strategy and targets;■business issues, including the operational plan of the Company
and 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 that the Board Members get toknow the Executive Committee Members equips them to makejudgements when it comes to decisions about key positions.
The Executive Committee met four times during 2017.

COMPOSITION OF THE EXECUTIVE COMMITTEE AT THE END OF 2017
Name

Start of term

Principal Occupation

Tom Enders

2012

Chief Executive Officer Airbus

Fernando Alonso

2015

Head of Military Aircraft Airbus Defence and Space

Thierry Baril2012

Chief Human Resources Officer Airbus & Airbus Commercial AircraftFabrice Brégier

2012

Chief Operating Officer Airbus and President Airbus Commercial Aircraft

Guillaume Faury

2013

Chief Executive Officer Airbus Helicopters

John Harrison

2015

Group General Counsel Airbus

Dirk Hoke2016

Chief Executive Officer Airbus Defence and SpaceJohn Leahy

2012

Chief Operating Officer – Customers Airbus Commercial Aircraft

Allan McArtor

2014

Chief Executive Officer Airbus North America

Klaus Richter2015

Chief Procurement Officer Airbus & Airbus Commercial Aircraft

Harald Wilhelm

2012

Chief Financial Officer Airbus

Tom Williams

2015

Chief Operating Officer Airbus Commercial Aircraft

Note: Status as of 1 January 2018. The professional address of all Members of the Executive Committee for any matter relating to Airbus is Mendelweg 30, 2333 CS Leiden,
the Netherlands.

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Tom Enders – Chief Executive Officer Airbus(see above under “— 4.1.1.1 Board of Directors”)

Fernando Alonso – Head of Military Aircraft Airbus
Defence and Space
Fernando Alonso was named as Head of Military Aircraft, Airbus
Defence and Space on 29 January 2015 and took up the positionon 1 March 2015. He is a member of the Airbus Defence andSpace Executive Committee and on 1 July 2015 was appointed
to the Executive Committee. Previously he was Senior Vice
President Flight and Integration Tests, Head of Flight Operations
since September 2007, and, before that, Vice President Flight
Test Division since February 2002.
Fernando Alonso began his professional career with McDonnell
Douglas in Long Beach, California in 1979 as a performanceengineer in the Company’s ﬂight test department. Three years
later, he joined Airbus as a performance engineer in the ﬂight
division.
While remaining with Airbus, he graduated as a ﬂ ight test
engineer at l’École du Personnel Navigant d’Essais et deRéception (EPNER) in 1990, and then became a ﬂ ight test
engineer responsible for aircraft performance of the A330,
A340 and A321.

competences 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.

Between 1995 and 2002, Fernando was responsible for thedevelopment of ﬂight controls and handling qualities during
the ﬂight test programmes of the A319, A330-200, A340-500
and A340-600. Subsequently, he was deeply involved in theorganisation and coordination of the ﬂight test campaign of
the A380.

Fabrice Brégier – Chief Operating Officer Airbus andPresident Airbus Commercial Aircraft

During a career at Airbus that has spanned more than 30 years,
Fernando has accumulated more than 4,300 hours of ﬂight tests.
He was a ﬂight test engineer on the maiden ﬂights of A340-200
in 1992, the A319 in 1997, the A380 in April 2005 and mostrecently the A350 XWB in June 2013.

Fabrice Brégier was appointed President of Airbus Commercial
Aircraft & Chief Operating Ofﬁcer Airbus on 1 January 2017. He
previously was the President and Chief Executive Ofﬁcer of the
Airbus Commercial Aircraft Division since June 2012. In 2017,
Mr Brégier was a member of the Executive Committee.

Born in Madrid, Spain in 1956, he obtained a degree from the
Polytechnic University of Aeronautical Engineers in Madrid in
1979. He is a keen skier and tennis player. He and his family
are also actively involved in the French charity Pour un Sourired’Enfant, fundraising and organising summer camps forunderprivileged children who live in a municipal dump in Phnom
Penh, Cambodia.

He started his career in 1983 as a test engineer at the CreysMalville nuclear power station, becoming sales manager for
Péchiney (Japan) in 1984. In 1986 he joined the DRIRE Alsace(Ministry of Industry) and was then appointed Director of
Economic and Financial Affairs with the Ministry of Agriculture
in 1989.

Thierry Baril –Chief Human Resources Officer Airbus& Airbus Commercial AircraftThierry 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
engagement. He oversaw the development of key skills andHaving been Advisor to several French Ministers, Mr. Brégier
joined Matra Défense in 1993 as Chairman of the Apache MAW
GIE (co-operation with Dasa) and Chairman of the Eurodrone
GIE (with STN-Atlas). In 1996 he was appointed Director ofStand-Off activities (Apache, Scalp EG/Storm Shadow) in what
had become Matra BAe Dynamics.
In 1998, Mr. Brégier became CEO of Matra BAe Dynamics. He
was appointed CEO of MBDA, the leading European missile
systems company that was created in 2001 by Aerospatiale
Matra, British Aerospace and Finmeccanica. In 2003, Fabrice
Brégier became President and CEO of the Eurocopter Groupand was appointed Head of EADS’ Eurocopter Division inJune 2005.

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Mr. Brégier was appointed Airbus Chief Operating Ofﬁ cer(COO) in October 2006. As a Member of the EADS Executive
Committee, he was commissioned by Louis Gallois toimprove the overall operational performance of the Group.
His responsibilities included the Company’s wide-ranging
restructuring and change programme (Power8), the Executive
Committee functions Operations, Engineering and Procurement,
and the A350 XWB programme.
Mr. Brégier graduated from the École Polytechnique in 1980 andfrom the École des Mines. He was born in 1961 in Dijon, France.

Guillaume Faury – CEO Airbus Helicopters
Guillaume Faury became Chief Executive Ofﬁcer (CEO) of Airbus
Helicopters – formerly Eurocopter – on 1 January 2014 and isa member of the Executive Committee.
Prior to assuming this position, he had been CEO of Eurocopter
since May 2013. He joined Eurocopter from Peugeot S.A., where
he had served as Executive Vice President for Research andDevelopment since 2010 and as a Member of the Managing
Board since 2009.
Guillaume Faury, a licensed ﬂight test engineer, served in various
senior management functions at Eurocopter from 1998 to 2008
before joining Peugeot S.A. He was Chief Engineer for theEC225/725 programme, Head of the Heavy Helicopter Flight
Test department, Executive Vice President for Commercial
Programmes and, ultimately, Executive Vice President for
Research & Development. Guillaume Faury also was a memberof the Eurocopter Executive Committee.
He started his professional career with the French Defence
Procurement Agency DGA, where he was in charge of Tiger
helicopter ﬂight test activities at the Istres Flight Test Centre.
Guillaume Faury, born in February 1968, holds an engineering
degree from the École Polytechnique in Paris as well as anaeronautics and engineering degree from the École Nationale
Supérieure de l’Aéronautique et de l’Espace in Toulouse.

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.
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.

John Harrison – General Counsel Airbus
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 ten 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 – CEO 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.

John Leahy – Chief Operating Officer-Customers
Airbus Commercial AircraftJohn Leahy was appointed Chief Operating Ofﬁcer – Customersof Airbus in July 2005 and assumed the same role for Airbus
Commercial Aircraft effective from 1 January 2017. Hecontinued his responsibilities as Chief Commercial Ofﬁcer ofthe Airbus Commercial Aircraft division, a role he had held
since August 1994. His responsibilities covered all commercial
activities including sales, marketing, contracts, business
transaction control, asset management, leasing, and businessdevelopment. Leahy was a member of the Airbus Executive
Committee in 2017.
One of Leahy’s greatest achievements was to raise Airbus’
market share from 18% in 1995 to over 50% by the turn of the
century, where it has been maintained over the last 14 years. He
also led the commercial activities that resulted in the successful
launch of Airbus next generation ﬂagship aircraft which set the

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standards for large aircraft in the 21st century, the A380 and theA350 XWB. Leahy was also a key player in the launch of the
A320neo (New Engine Option) family, which has become thefastest selling aircraft programme in aviation history. He wasalso instrumental in the launch of the A350 XWB family as wellas the A330neo.
John Leahy worked for seven years in marketing at Piper
Aircraft before joining Airbus North America in January 1985.
He became Head of Sales in 1988 and then became President of
Airbus North America. Leahy was responsible for the penetrationof the strategic North American market, where most major U.S.
airlines are now Airbus customers.
John Leahy has an MBA from Syracuse University withconcentration in both Finance and Transportation Management
and a BA from Fordham University with a dual major in
Communications and Philosophy. He is also a licensed multiengine commercial pilot and a former flight instructor. In
March 2012, he received one of France’s top civilian awards
by being named an Ofﬁcer of the Légion d’Honneur, for his
services to European and French aviation.

Allan McArtor – CEO Airbus North America
Allan McArtor was Chairman of Airbus Americas, Inc. In thisleadership role, McArtor enhanced relationships with Airbus’
customers, suppliers and government representatives. He
was instrumental in providing strategy and vision for Airbus
companies throughout the United States, Canada and Latin
America. McArtor increased the Company’s commercial aviation
market share throughout the region and established the A320
Aircraft Assembly Line in Mobile, Alabama.
Throughout his career, McArtor has held a series of leadershipand senior management positions in the military, civil andgovernment sectors.
Before joining Airbus, he was founder, chairman and CEO of
Legend Airlines, a regional airline based at Dallas Love Field,
Texas.
President Ronald Reagan appointed McArtor to serve as the
Administrator of the FAA from 1987 to 1989.
McArtor served on the senior management team of Federal
Express from 1979 to 1987 and 1989 to 1994 ﬁrst as SeniorVice President Telecommunications during the developmentof FedEx’s extensive satellite-based digital network, then as
Senior Vice President Air Operations for FedEx’s global airline.
McArtor was a combat ﬁghter pilot in Vietnam from 1968 to
1969, an Associate Professor of Engineering Mechanics at
the Air Force Academy, and a pilot with the U.S. Air Force’s
Thunderbirds Aerial Demonstration Team.
He is a 1964 graduate of the U.S. Air Force Academy (BSE) andholds a master’s degree (MSE) from Arizona State University.
He holds an honorary doctorate degree from Christian Brothers
University in Memphis, Tennessee, in recognition of his role inestablishing the School of Telecommunications and Information
Systems.

Klaus Richter – Chief Procurement Officer Airbus& Airbus Commercial AircraftKlaus Richter became Chief Procurement Ofﬁcer for Airbus SE
on 1 January 2015. In this function, he is a member of the
Executive Committee and the Airbus Executive Committee.
In addition, he serves as the Chairman of the Board of Airbus
in Germany and leads the supervisory board of Premium
AEROTEC Group.
He is in charge of procurement across the entire Airbus
Commercial Aircraft organisation, having responsibility fordeveloping strong partnerships with suppliers and ensuring
timely delivery of all purchased goods on cost and with theproper quality.
In addition, Richter leads the General Procurement Organisationof Airbus. He coordinates strategic procurement topics, as wellas the development and application of procurement processes
and tools across the Group. Richter is also responsible for the
Airbus Regional Sourcing Ofﬁces in the U.S., India and China.
In January 2017, Klaus Richter also assumed the role of thepresident of the German Aerospace Industries Association(BDLI).
Richter joined Airbus in November 2007 as Executive Vice
President Procurement for Airbus. Before joining the Group,
Richter was Senior Vice President Materials Purchasing for
BMW, based in Munich, Germany. In this position, he washeading all supplier relations for direct materials and equipment
across the entire company.
Klaus Richter began his professional career with McKinsey& Company in 1993 as a management consultant for
automotive, electronics and aerospace businesses and productdevelopment, a role which he retained until he joined the BMW
Group in 2003 as Head of Purchasing Strategy for production
materials.
Richter graduated from the Technical University of Munich where
he obtained a doctorate in mechanical engineering in 1991. After
graduation he received a Humboldt scholarship and spent two
years as a researcher and teacher at the University of California
at Berkeley.
Born in Munich on 29 September 1964, Klaus Richter is married
with two children.

Harald Wilhelm – Chief Financial Officer Airbus
Harald Wilhelm has been Chief Financial Ofﬁcer of Airbus andAirbus Commercial Aircraft since 1 June 2012 and is a memberof the Executive Committee.
He has held the role of Airbus Commercial Aircraft CFO since
1 February 2008. Previously, he was Airbus Commercial Aircraft
Chief Controlling Ofﬁ cer and deputy to the Chief Financial
Ofﬁcer, a position to which he was appointed on 1 January 2007.
Prior to this, he was Senior Vice President, Airbus Commercial
Aircraft Financial Control, a role he held from 2003 to 2006.
Wilhelm joined Airbus Commercial Aircraft in 2000 as SeniorVice President, Accounting, Tax and Financial Services.

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Before joining Airbus, Wilhelm had been Vice President M&A(mergers and acquisitions) at DaimlerChrysler Aerospace from1998, where he worked on projects including the integration of
Airbus into a single company. Prior to this, he had been Senior
Manager M&A at Daimler-Benz Aerospace from 1995 to 1998
and M&A Manager for the Company between 1992 and 1993.
Born in April 1966 in Munich, Wilhelm has a degree in BusinessStudies from Ludwig Maximilians University in Munich.

Tom Williams – Chief Operating Officer Airbus
Commercial Aircraft
Tom Williams was appointed Chief Operating Ofﬁcer (COO) of
Airbus Commercial Aircraft in January 2015. He is responsible forthe overall operations including Engineering, Procurement andSupply Chain Management. Tom is a member of the Executive
Management Team of Airbus and the Airbus Commercial Aircraft
Executive Committee.

Manufacturing and Business Group Director for the Sensors
activity of Pilkington Optronics – a joint venture with Thomson
CSF of France. Focusing initially on the introduction of “leanmanufacturing” techniques, he also became involved in
integrating Thorn EMI Electro Optics into the business.
Tom joined British Aerospace (now merged with Marconi
Electronic Systems to form BAE Systems) in 1997 as Site
Director and General Manager at the Prestwick site of thecompany’s Aerostructures division. Two years later he wasappointed Operations Director – Internal Supply, within thecompany’s Military Aircraft and Aerostructures Division, thenEurofighter Operations Director with responsibilities that
included manufacturing and other business functions at the
Warton and Salmesbury sites of BAE Systems.
In November 2000, Tom became Managing Director andGeneral Manager of Airbus UK, a position he held until hebecame Airbus’ Executive Vice President Procurement in 2004.

Previously Tom was Airbus Commercial Aircraft Executive Vice
President Programmes, a position he held from July 2005. Hisrole covered all Airbus aircraft families and as such, he wasin charge of ensuring the proﬁtability of the civil programmes,of leading the product policy and the development of new
products, as well as ensuring proper delivery to the customers.
Before being appointed to this position, he had been Executive
Vice President Procurement since February 2004.

Tom was born in 1952 in Glasgow. During his apprenticeshiphe gained an HNC in Production Engineering and in 1988 an
MBA from Glasgow University. Married with one daughter, Tom
is a keen football supporter and occasional golfer.

After completing an apprenticeship with Rolls-Royce AeroEngines in 1972, Tom went on to carry out increasingly senior
roles in a number of UK manufacturing companies.

Last year, Tom received the Mensforth Manufacturing Medalfrom the Institute of Engineering and Technology (IET) for
his achievements as a world-class production engineer, andwas awarded the Honorary Degree of Doctor of Business
Administration by the University of the West of England inrecognition of his contribution to operations, manufacturing
and business.

In 1992 he was appointed Operations Manager for Cummins
Engines, looking after all manufacturing at the Company’s
1,200-strong Scottish factory. At the start of 1995 he became

Tom received a Commander of the Order of the British Empire(CBE) in January 2011 and was awarded the rank of Knight in the
Légion d’Honneur by the Republic of France in December 2015.

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 supports
the emphasis of the revised Dutch Code on topics such as
long-term value creation and the importance of culture. Airbus
already complies with a vast majority of the provisions of therevised Dutch Code.

For the full text of the Dutch Code as well as the New Code,please refer to www.commissiecorporategovernance.nl.
For the ﬁnancial year 2017 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.

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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. Severance pay will not
be awarded if the Board membership is terminated early at
the initiative of the Executive Board Member, or in the eventof seriously culpable or negligent behaviour on the part of the
Executive Board Member.
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 fulﬁlhis 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. Furthermore,
the Company does not encourage non-Executive Directors to
own shares.
The Company does not require its non-Executive Directors
who hold shares in its share capital, to keep such shares asa long-term investment. Although non-Executive Directors
are welcome to own shares of the Company, the Company
considers it is altogether unclear whether share ownershipby non-Executive Directors constitutes a factor of virtuousalignment with stakeholder interest or may be a source of 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.

5. Pay Ratios
Provision 3.4.1 of the Dutch Code recommends that the
remuneration report described in Section 4.2.1 – Remuneration
Policy – below should include a description of the pay ratios
within Airbus and, if applicable, any changes in these ratios incomparison with the previous ﬁnancial year.
The Company wants to ensure a transparent and accurate
disclosure of information in its remuneration report. At the date ofthis Registration Document, the Company is not able to disclosethe exact pay ratio between the CEO and a representativereference group determined by Airbus for the 2017 ﬁnancial
year or, to the extent relevant, any changes in these ratios incomparison with the 2016 ﬁnancial year. However, the Company
is committed to include this information in its board report forthe 2018 ﬁnancial year.

6. Gender Diversity
The Company strives to comply with composition guidelines
which mean the Board of Directors would be regarded as being
composed in a balanced way if it contained at least 30% womenand 30% men. These percentages are based on those included
in a Dutch bill that came into force in 2017 in continuation ofprevious legislation in force stipulating the same percentages.
With the election of Amparo Moraleda in 2015 and the election of
Catherine Guillouard and Claudia Nemat in 2016, the proportionof the female representation on the Board of Directors is at
25% (against 0% ﬁve years ago). The Company will continue
to promote gender diversity within its Board of Directors inaccordance with the principles mentioned in section 4.1.1.1
above.

4.1.3 Enterprise Risk Management System

Airbus’ long-term development and production lifecycle makeEnterprise Risk Management (“ERM”) a crucial mechanism forboth 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.

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The ERM system is articulated along four axes:■
Anticipation: early risk reduction and attention to emerging
risks;■
Speak-up & early warnings;■
Robust risk mitigations;■
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 Airbus. The Company’s
ERM Policy is supplemented by directives, manuals, guidelines,
handbooks, etc. External standards which contribute to theCompany’s ERM system include the standards as deﬁned by
the International Organisation for Standardisation (“ISO”).
The ERM process consists of four elements:■
a strong operational process, derived from ISO 31000 – toenhance operational risk and opportunity management;■a reporting process, which contains procedures for the status
reporting of the ERM system and the risk/opportunity situation;■a ERM compliance process, which comprises procedures toassess the effectiveness of the ERM system; and■a support process, which includes procedures to maintainand 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 Airbus organisations, including Divisions, subsidiaries
and controlled participations, commit to and confirm the

4.1.3.3

effective 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 Airbus is exposed,
see “— Risk Factors”.

4.1.3.2

ERM Governance and Responsibility

The governance structure and related responsibilities for the
ERM system are as follows:■
the Board of Directors supervises with support of the Audit
Committee the strategy and business risk and opportunities
as well as design and effectiveness of the ERM system;■
the CEO, with the top management, is responsible for aneffective 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;■
the management at executive levels has the responsibility
for 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.

ERM Effectiveness

The ERM effectiveness is analysed by ERM centre of competence (“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).
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.

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 ethicalbusiness principles.

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4.1.3.4

Board Declaration

Based on the reports made directly available to the Board of
Directors, coming from different processes, audits and controls
and the information it received from management, the Board of
Directors believes to the best of its knowledge that the internalrisk management and control system provides reasonableassurance that the ﬁnancial reporting does not contain any
material inaccuracies. This report provides sufﬁcient insight
into any material failings in the effectiveness of the internalrisk management and control systems. No matter how welldesigned, the internal risk management and control system has

inherent limitations, such as vulnerability to circumvention or
overrides of the controls in place. Consequently, no assurance
can be given that the Company’s internal risk management
and system and procedures are or will be, despite all care andeffort, entirely effective.
Based on the Company’s current state of affairs, it is justiﬁed thatthe ﬁnancial statements have been prepared on a going concern
basis. The Board of Directors conﬁrms that to the best of its
knowledge this report states the material risks and uncertainties
that are relevant to the expectation of the Company’s continuity
for the period of 12 months after the preparation of the report.

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 Airbus’s risk
management, internal controls and governance systems.
This covers three areas: r isk management processes, boththeir design and how well they are working; management of
those risks classiﬁed as “key”, including the effectiveness ofthe controls and other responses to them; and reliable andappropriate assessment of risks and reporting of risk and control
status.
Corporate Audit & Forensic engages in the independent andobjective corporate assurance activities of internal auditing
and forensic investigations. It supports Airbus 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.
It is established by direct reporting to the Audit Committee
and CEO. Corporate Audit adheres to the Institute of Internal
Auditor’s Deﬁnition of Internal Auditing, Code of Ethics andInternational Standards for the Professional Practice of Internal
Auditing as well as relevant policies and procedures of Airbus.
Its framework of operation is set out in the Airbus Corporate
Audit and Forensic Charter.

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4.2 Interests of Directors and Principal
Executive Ofﬁcers
4.2.1 Remuneration Policy

The Company’s Remuneration Policy covers all Members of theBoard of Directors: the CEO (who is the only Executive Director)
and the other Members of the Board (which is comprised of
non-Executive Directors).

4.2.1.1

It should be noted that although the Policy relating to Executive
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.

The Company’s remuneration philosophy has the objective ofproviding remuneration that will attract, retain and motivate
high-calibre Executives, whose contribution will ensure that
the Company achieves its strategic and operational objectives,
thereby providing long-term sustainable returns for all
shareholders.

No 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 2018. The application of
the Remuneration Policy in 2017 will be included as a separate
agenda item for discussion at the AGM to be held in 2018. To see
how the Remuneration Policy was applied in 2017 in respect of
the CEO (the only Executive Member of the Board of Directors (1),see “— 4.2.1.3 Implementation of the remuneration policy in2017: 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 2017 inrespect of the non-Executive Members of the Board of Directors,
see “— 4.2.1.4 Implementation of the remuneration policy in2017: Non-Executive Directors”.

Executive Remuneration – Applicableto the CEOa) Remuneration Philosophy

The Board of Directors and the RNGC are committed to making
sure that the Executive remuneration structure is transparent
and comprehensible for both Executives and investors, and toensure that Executive rewards are consistent and aligned with
the interests of long-term shareholders.
Before setting the targets to be proposed for adoption to theBoard of Directors, the RNGC considers the ﬁnancial outcome
scenarios of meeting performance targets, as well as ofmaximum performance achievements, and how these may
affect the level and structure of the Executive remuneration.

b) Total Direct Compensation and Peer GroupThe Total Direct Compensation for the CEO comprises a Base
Salary, an Annual Variable Remuneration (“VR”) and a LongTerm Incentive Plan (“LTIP”). The three elements of the Total
Direct Compensation are each intended to comprise one-third of
the total, assuming the achievement of performance conditions
is 100% of target.
The level of Total Direct Compensation for the CEO is set at themedian of an extensive peer group. The benchmark is regularly
reviewed by the RNGC and is based on a peer group which
comprises:■
Global companies in Airbus’ main markets (France, Germany,
UK and US); and■Companies operating in the same industries asAirbus worldwide.

(1) The cumulated remuneration of all Executive Committee Members is presented in the “Notes to the IFRS Consolidated Financial Statements — Note 31: Remuneration”.

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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 achievementof Company
performancemeasures andindividual objectives.

LTIP

Rewards long-term
commitment
and Company
performance, andengagement on
financial targets
subject to cumulative
performance overa three-year period.

Collective (50% of VR): divided
between EBIT(1) (45%); Free CashFlow(2) (45%) and RoCE (10%).
Individual (50% of VR):
Achievement of annual individual
objectives, divided between
Outcomes and Behaviour.
Vesting ranges from 0% to150% 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%).

The VR is targeted at 100%of the Base Salary for the CEO and,depending on the performanceassessment, 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.
Since 2012, the following caps apply to
Performance Units only: overall pay-out iscapped at a maximum of 250% of the originalvalue at the date of grant.
The value that could result from share priceincreases is capped at 200% of the reference
share price at the date of grant.

(1) Airbus 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) change of securities, (iv) contribution to plan assets of pension schemes and (v) realised foreign exchange results on treasury swaps. It is a key indicator which allows theCompany to measure the amount of cash flow generated from operations after cash used in investing activities.

Policy from 2016 (approved by 2016 AGM)
details, see “— 4.2.1.4 Implementation of the Remuneration
Policy in 2017: CEO”).

The RNGC regularly benchmarks the CEO’s Total Direct
Compensation (Base Salary, Annual Variable Remunerationand LTIP) against an extensive peer group. The relevant peergroup was composed with the assistance of an independent
consultant Willis Towers Watson, and comprised 31 companies
having comparable economic indicators such as revenues,
number of employees and market capitalisation. Financial
institutions were excluded from the peer group (for further

Following the change approved at the AGM in 2016, and as
illustrated in the table below, the structure of the CEO’s Total
Direct Compensation will remain unchanged in 2018. Indeed,
the on-target levels of VR and LTIP will each amount to 100%of the CEO’s Base Salary.

SCENARIOS CEO TOTAL DIRECT COMPENSATION

Indications are in million euros.

Below Threshold“Below Threshold” includes annual Base Salary;VR at 0%; LTIP not vesting.

TargetMaximum“Target” includes Base Salary, VR at target andLTIP grant face value in cash and in shares.
0

Base Salary

1

2

3

4

Variable Remuneration (VR)5

6

LTI paid in cash

7

8
LTI paid in shares“Maximum” includes Base Salary; maximum VR
value (200% of VR at target); maximum LTIP
cash grant projected at vesting date (250% ofgrant value); maximum performance applicableto the number of shares granted (150%).
The share price development is unpredictable.
The ﬁnal value of performance shares cannot becapped.

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4.2 Interests of Directors and Principal Executive Ofﬁ cersc) Base Salary

Common Collective Component

The Base Salary of the CEO is determined by the Board of
Directors, taking into account the peer group analysis mentioned
above.

The Common Collective Component is based on EBIT (45%),
Free Cash Flow (45%) and RoCE (10%) objectives. Each year,
the Board of Directors sets the goals for these key 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 fromthese).

d) Annual Variable Remuneration
The Variable Remuneration is a cash payment that is paid eachyear, depending on the achievement of speciﬁc and challenging
performance targets. The level of the Variable Remuneration for
the CEO is targeted at 100% of the Base Salary; it is capped at
a maximum level of 200% of the Base Salary. The entire Variable
Remuneration is at-risk, and therefore if performance targets
are not achieved sufﬁciently, 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.

To calculate the Common Collective annual achievementlevels, actual EBIT, Free Cash Flow and RoCE performance iscompared against the targets that were set for the year. This
comparison forms the basis to computing achievement levels,
noting that the actual EBIT, Free Cash Flow and RoCE levels areoccasionally adjusted for a limited number of factors which areoutside management control (such as certain foreign exchange
impacts or unplanned merger and acquisition activities). The
RNGC’s intention is to ensure ambitious ﬁnancial targets andto 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,ﬁnancing, and investment activities

AirbusExecutives
commoncollective
ﬁnancialtargets

RoCE
Annual, % (10%)
Measures how much proﬁt is generated by
the capital invested in the business
Driven by operational and capital efﬁciency

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Individual
The Individual element focuses on Outcomes and Behaviour.
Individual performance is assessed in these two importantdimensions:■
Outcomes encompass various aspects of what the CEO
can do to contribute to the success of the business: speciﬁcbusiness 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 Company Top Priorities;■
Behaviour refers to the way results have been achieved,
which is also critical for long-term success: how the CEO
and the Board of Directors work as a team, how the CEOleads the Executive Committee, quality of communication,encouragement of innovation, etc. A speciﬁ c part of the
behaviour assessment relates to ethics, compliance andquality issues.

e) Long-Term Incentive Plan
There are two types of Long-Term Incentive Plans: until 2015,
LTIP was made up of Performance 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.

The value of the CEO’s LTIP allocation is capped as apercentage of the Base Salary at the date of grant and subject
to performance conditions.
The performance conditions are assessed over a three-year
period based on relevant ﬁnancial criteria with stringent targets
set, as demonstrated by past Company practices.
Both Performance Units and Performance Shares that vest canvary 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 andunpredictable circumstances, the Board of Directors, uponrecommendation 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%) 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

Free cash Flow
Cumulated over 3 years, M€

Measures proﬁtability
Driven by net income and number of shares

Measures cash generation
Driven by cash provided by/used for
operating, ﬁnancing, and investment activities

For reasons of conﬁdentiality, the precise targets set for the
average EPS and cumulated Free Cash Flow, even though they
have been properly established in a precise manner, cannot be
publicly disclosed as these objectives are in part linked to theCompany’s strategy. Nonetheless, for the sake of transparency
and to ensure compliance with best market practices,
retrospective information demonstrating the stringency of thetargets 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 thefollowing 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 iscapped at 200% of the reference share price at the date of
grant;■
the overall pay-out is capped at 250% of the value at thedate of grant

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Performance Units Plan Characteristics(until and including 2015 plan)
Performance Units are the long-term equity-related incentive
awards that are currently granted to the CEO. LTIP awards
are granted each year. Each grant is subject to a three-year
cumulative performance objective. At the end of the three-year
period, the grant is subjected to a performance calculation todetermine whether and to what extent it should vest. Depending
on continued employment, grants attributed until 2013 will vest in
four tranches, the payment of which takes place approximately
6, 12, 18 and 24 months following the end of the performance
period. Depending on continuous employment, grants attributed
from 2014 would vest in two tranches, the payment of which
would take place approximately 6 and 18 months following theend of the performance period.

At the date of grant, the CEO must decide what portion of
the allocation (subject to the performance calculation) would
be released as cash payments and what portion would be
converted into shares. At least 25% (and up to 75%) of theaward must be deferred into shares, and would only 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 FROM 2014 TO 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 & 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. 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 payment of 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 end of the performance period.

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LTIP-SCHEME SINCE 2016

Performance calculation
determines the number of Unitsand shares that may vest

GRANT DATE
Face value at grant date
Allocation policy

Y

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 Guideline
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.

clause applies 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.

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.

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 and is not accelerated
in any case. LTIP awards are forfeited for Executives who leave
the Company on their own initiative, but this is subject to review
by the Board of Directors.

h) Retirementj) Clawback

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.

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.

g) Benefitsi) Contracts and Severance
In the case of contract termination, the CEO is entitled to anindemnity 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.
The CEO’s contract includes a non-compete clause whichapplies for a minimum of one year and can be extended at theCompany’s initiative for a further year. The Board of Directors
has the discretion to invoke the extension of the non-competeclause. The compensation for each year that the non-compete

Any revision, claw back, or amounts deducted from the CEO’s
remuneration will be reported in the notes of the relevant
ﬁnancial statements.

k) Loans
The Company does not provide loans or advances to the CEO.

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.

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4.2 Interests of Directors and Principal Executive Ofﬁ cers

Fees and Entitlementsb) Base Salary

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;■an attendance fee for the attendance to Board meetings.

For 2017, the Base Salary remains at € 1,500,000. The CEO’s
Base Salary level was reviewed in 2015 and approved byshareholders at 2016 AGM. Any future review of the CEO’s
Base Salary will also take into consideration salary increasesof employees across the Company.

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 were reviewed
to recognise the increase in Board Members’ responsibilities,
their greater time commitment and Airbus’ continuous need to
attract and retain highly competent Members. To incentivise
Board attendance, the attendance fees have doubled. Membersof the Board are entitled to the following fees:
Fixed fee for membership of the Board (EUR / year):■
Chairman of the Board: € 210,000■
Member of the Board: € 80,000
Fixed fee for membership of a Committee (EUR / year):■
Chairman of a Committee: € 30,000■
Member of a Committee: € 20,000
Attendance fees (EUR / Board meeting):■
Chairman: € 15,000■
Member: € 10,000
Attendance fees shall decrease by 50% in case of an attendanceby 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).

4.2.1.4

Implementation of the Remuneration
Policy in 2017: CEOa) Benchmarking
Based on a review the RNGC performed in 2014 with theassistance of an independent consultant, Willis Towers Watson,
it was concluded that the CEO’s Total Direct Compensation wasslightly below the median level of the peer group. In 2017, there
was no increase of the CEO remuneration.

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.
For 2016, the VR amounted to an aggregate € 2,167,500
composed of € 1,192,500 for the Common Collective Component(159%), and € 975,000 for the Individual part (130%).
The Common Collective Component results from a composite
159% achievement of EBIT, Free Cash Flow and RoCE
objectives.
This achievement mainly reﬂects a solid EBIT and Free Cash
Flow generation against the budgeted targets. The main
drivers of that success were the strong underlying businessperformance, healthy pre-delivery payments inﬂows, ongoing
efforts to control working capital including payment terms to
suppliers and lower R&D spending. Finally, RoCE was slightly
below the target.
Normalisation adjustments were made to exclude exceptional
events such as currency exchange differences or those arisingfrom phasing mismatches.
The Individual part results from a good achievement level of
130% 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 good assessment were among
other achievements:■
solid ﬁnancial ﬁgures achieving the envisaged targets to alarge extent despite set-backs on the A400M programme;■very good operational performance with a new record numberof aircraft deliveries mastering a solid ramp-up of the A350
programme and the transition from the ceo to the new neo
version of the A320 programme despite technical issues withboth new engine types;■
excellent strategic move in acquiring the Bombardier C Series
programme to complement the Airbus product portfolio andto set the pace for the competition;■
conﬁrmed lead on the civil and parapublic helicopter market
against a challenging market backdrop while slightly improving
the position on the military market;■
good progress in key development programmes Airbus A3501000, Airbus Helicopters H160 and Ariane 6;

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4.2 Interests of Directors and Principal Executive Ofﬁ cers

rapid implementation of the digital roadmap including
digitalisation of the development and production processes;■“Go live” for the Company’s further integration through the“Gemini” project by merging Airbus and Airbus Group for aleaner and more efﬁcient management;■strong focus on Company-wide benchmark Compliancestandards and processes as well as coordinated Corporate
Social Responsibility activities;■
reinforced efforts on gender and international diversity as wellas implementation of new HR transformation and management
development programmes.
■

PERFORMANCE AGAINST TARGET

TargetThresholdMaximum

Common Collective
Component (50%)

159 %
130%

Individual (50%)
Overall Performance
Achievement

144,5 %

0%

20%

40%

60%

80%

100%

120%

140%

160%

180%

4

200%

d) Long-Term Incentive Plan
Granting 2017
As stipulated in the Company’s Remuneration Policy the CEO is eligible for a Performance Units and Performance Shares award
under the Company’s LTIP 2017. The value of the Performance Unit and Share award is capped at 100% of the Base Salary at
the date of grant. During 2017, the CEO was granted in total of both 20,324 Performance Units and Performance Shares.
The table below gives an overview of the Performance Units and Performance Shares granted to the CEO in 2017 pursuant to
the LTIP*:
Unit plan: number of Performance Units

Thomas Enders

Granted in 2017

Vesting dates

10,162

Vesting schedule is made up of 2 tranches over 2 years:(i) 50% expected in May 2021;(ii) 50% expected in May 2022.

* There is no obligation under the Dutch Financial Supervision Act to notify the cash units under the LTIP to the AFM. The CEO’s cash units are therefore no longer reflected in
the AFM register.

Share plan: number of Performance SharesThomas Enders

Granted in 2017

Vesting dates

10,162

Vesting schedule is made up of 1 tranche:(i) 100% expected in May 2021

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Vesting Values in 2017
In 2017, the CEO received both cash payments and vested shares in connection with the vesting of 2012 and 2013 LTIP awards:■
Cash: the total cash payment to the CEO amounted to € 1,372,048 in 2017 versus € 2,279,709 in 2016.
■

Shares: In connection with the 2012 LTIP award, the CEO had elected that 25% of his grant should be deferred into shares.
Therefore, the CEO received 11,192 vested shares (16,448 vested shares in 2016) on the fourth vesting date for the 2012 LTIP
(31 November 2017). In connection with the 2013 LTIP award, the CEO had elected that 50% of his grant should be deferred
into shares. Therefore, the vesting of 5,682 Performance Units for the LTIP 2013 will be released in the form of shares on the
fourth vesting date for the 2013 LTIP (which will take place in 2018).

LTIP Overview: Granting and VestingDateofgrants

Grant
Type

Share
price atNumber grant date

Value at(Un)
grant date conditional

Performanceachievement

Units withperformanceachievement

Dates ofvesting

Share value
at vesting dates
1st vesting –3 May 2016: € 55.66*
2nd vesting –31 October 2016: € 53.77
3rd vesting –3 May 2017: € 55.66*

2012

Units

50,300€ 27.83€ 1,399,849

Conditional

89%

44,7684 vestings in
4th vesting –2016-2017 3 November 2017: € 55.66*
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

2014

Units

29,500€ 47.45€ 1,399,775

Conditional

80%

23,6002 vestings in
2018-2019

Not yet known
Not yet known

2015

Units

24,862€ 56.31€ 1,399,979

Conditional

Not yet known

Not yet known

2 vestings in
2019-2020

2016

Units

14,240€ 52.67€ 750,021

Conditional

Not yet known

Not yet known

2 vestings in
2020-2021

Not yet known
Not yet known
Not yet known2016

Shares

14,240€ 52.67€ 750,021

Conditional

Not yet known

Not yet known

1 vesting in
2020

2017

Units

10,162€ 73.81€ 750,057

Conditional

Not yet known

Not yet known

2 vestings in
2021-2022

Calculations may involve rounding to the nearest unit.
* For vesting 2012 the cap applicable to the share price was applied.

Performance Conditions of LTIP 2013 and 2014
The performance conditions for LTIP 2013 were determined as follows:■
if Airbus reports negative cumulated EBIT results, the Board of Directors can decide in its sole discretion to review the vestingof the Performance Units, including the 50% portion which is not subject to performance conditions;■
50% to 150% of the allocation would be granted depending on the compounded achievement of the two following performance
criteria:
75% of average Earnings Per Share (“Ave EPS”): determined on a linear basis depending on three-year Ave EPS for the 2014,2015 and 2016 ﬁscal years, with the three-year Ave EPS target for an allocation of 100% equal to € 3.64,
and 25% of cumulative Free Cash Flow (“Cum FCF”): determined on a linear basis depending on three-year Cum FCF for the
2014, 2015 and 2016 ﬁscal years, with the three year Cum FCF target for an allocation of 100% equal to € 2,650m.
■■

The performance conditions for LTIP 2014 were determined as follows:
if Airbus reports negative cumulated EBIT results, the Board of Directors can decide at its sole discretion to review the vestingof the Performance Units, including the 50% portion which is not subject to performance conditions;■
50% to 150% of the allocation would be granted depending on the compounded achievement of the two following performance
criteria:
75% of Ave EPS: determined on a linear basis depending on three-year Ave EPS for the 2015, 2016 and 2017 ﬁscal years,
with the three-year Ave EPS target for an allocation of 100% equal to € 3.31,
and 25% of Cum FCF: determined on a linear basis depending on three-year Cum FCF for the 2015, 2016 and 2017 ﬁscal
years, with the three-year Cum FCF target for an allocation of 100% equal to € 4,298m.
■■■

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4.2 Interests of Directors and Principal Executive Ofﬁ cers

Review of Achievement of Performance Conditions
The Board of Directors on 21 February 2017 noted the achievement of the performance conditions of the 2013 plan, i.e. for the
2014, 2015 and 2016 ﬁscal years. The three year average EPS was € 2.28, after normalisation to align it with policies in force whensetting the target (notably IAS11). The three-year Cum FCF before M&A was € 3,440m.
Furthermore the Board of Directors on 14 February 2018 noted the achievement of the performance conditions of the 2014 plan,i.e. for the 2015, 2016 and 2017 ﬁscal years. The three year average EPS (“Ave EPS”) was € 2.81 after normalisation to align it with
policies in force when setting the target (notably IAS11). The three year cumulative FCF (“Cum FCF”) before M&A was € 9,741m.

Date ofgrants

KPI

Numberof units2012

Ave EPS

50,3002013

Cum FCF
beforeM&A

Ave EPS2014

Ave EPS
Cum FCF30,30029,500Compounded
Target for
Performance performancea 100%
achievement achievement
allocation Achieved in percentage in percentage€ 2.75€ 2.6389%€ 3.64€ 2.2850%€ 2,650m€ 3,440m

150%€ 3.31€ 2.8156%€ 4,298m€ 9,741m

150%

Resultingvesting in
numberFor comparison, average
EPS for the last 3 reported
years at the date of grant

N/A

44,768€ 0.34*75%

22,72480%

23,600€ 1.15**€ 1.51**** Average EPS of 2011, 2010 and 2009.
** Average EPS of 2012, 2011 and 2010.
*** Average EPS of 2013, 2012 and 2011.

e) Share Ownershiph) Retirement

The CEO owned 92,161 Company shares on 31 December
2017, which represents more than 200% of the base salary. He
herewith respects Airbus’ share ownership policy.

As of 31 December 2017, the present value of the CEO’s pension
deﬁned beneﬁt obligation, including deferred compensation
amounted to € 21,176,042 versus € 21,251,788 a year ago.
While the plan beneﬁts remain identical, the present value ofthe pension obligation was calculated applying a 1.5% discountrate in 2017 compared to a 1.7% discount rate in 2016, whichmainly explains the change in value. For the ﬁscal year 2017, thecurrent service and interest costs related to the CEO’s pension
promise represented an expense of € 1,175,057. This obligation
has been accrued in the Consolidated Financial Statements.

f) Employee Share Ownership Plan (ESOP)In March 2017, 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 2017, a dedicated UK tax
advantageous Share Incentive Plan (“SIP”), was also deployedin March 2017.
Although the CEO was eligible for the plan, he did notparticipate to the ESOP 2017 plan favouring the developmentof a shareholding 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 2017 amounted to € 63,250.

The deﬁned beneﬁt obligation for the CEO’s Company pension
results from the Company’s pension policy as describedabove and takes into account (1) the seniority of the CEO in
the Company and on its Executive Committee and (2) thesigniﬁcantly lower public pension promise deriving from theGerman social security pension system, compared to a pension
resulting from membership in the French pension system.

i) Clawback
The Board has not applied any clawback in 2017.

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4.2 Interests of Directors and Principal Executive Ofﬁ cers

4.2.1.5

Implementation of the Remuneration Policy in 2017: Non-Executive Directors

The last review of the Board remuneration was undertaken in 2015 and is in line with market practice, incentivise attendance andrecognise the strategic role played by the Board of Directors in Airbus’ developments. The CEO is the only Member of the Boardof Directors who is not entitled to any Board membership fee.
For personal reasons, and with regards to the implementation of remuneration policy approved at AGM 2016, Denis Ranquedecided 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, based on 6 meetings per year and including chairmanship Board ﬁxum andattendance fees) until further notice.
Taking into account D. Ranque’s wishes to waive the supplement linked to this remuneration policy, but also to the increaseof number of Board meetings in 2017, the remuneration of Denis Ranque related to 2017 as Chairman of the Board of Director(chairmanship Board Fixum and Attendance fees) is € 260,000.
Therefore, the Board recommended that the remuneration exceeding € 260,000 would be converted into an annual contribution
to the Airbus Foundation as long as Denis Ranque waived this part of his remuneration which corresponds to € 70,000 based on
the number of Board meetings in 2017.
Summary table of the 2017 and 2016 fees of all non-Executive Members of the Board (current and former):
2017
Fixum(1)(in €)

2016

Attendancefees(2)

Total

Fixum(1)Attendancefees(2)

Total

Non-Executive Board Members
Denis Ranque(3)204,293

80,000284,293

180,000

60,000240,000

Ralph D. Crosby Jr.

94,42080,000174,42080,00050,000130,000(4)

72,10060,000132,100000Catherine Guillouard(3)120,000

70,000190,000

67,58240,000107,582

Hans-Peter Keitel

100,000

60,000160,000

100,000

60,000160,000

Hermann-Josef Lamberti(3)135,707

70,000205,707110,000

55,000165,000

Lord Drayson(5)28,176

10,00038,176

100,000

50,000150,000

María Amparo Moraleda
Martínez(3)120,000

80,000200,000

100,000

55,000155,000

Claudia Nemat

100,000

70,000170,000

67,58230,00097,582Sir John Parker(3)135,707

65,000200,707110,000

60,000170,000

Lakshmi N. Mittal

Carlos Tavares

80,00065,000145,000

54,06620,00074,066

Jean-Claude Trichet

100,000

80,000180,000

100,000

60,000160,000

0026,15420,00046,154Former Non-Executive Board Members
Manfred Bischoff

0Anne Lauvergeon

0

0

0

32,692

10,00042,692Michel Pébereau

0

0

0

32,69220,00052,692

1,290,403

790,000

2,080,403

1,160,768

590,000

1,750,768

TOTAL(1) The fixum includes a base fee for a Board membership and a Committee fee membership within the Audit Committee, the RNGC and/or the E&C Committee. The fixum forthe year 2017 was paid 50% in January 2017 and 50% in July 2017. The fixum for the year 2016 was paid 50% in December 2015 and 50% in July 2016.
(2) The attendance fees related to the first semester 2017 were paid in July 2017, those related to the second semester 2017 are paid in January 2018. The attendance fees related
to the first semester 2016 were paid in July 2016; those related to the second semester 2016 were paid in January 2017.
(3) Member of the E&C Committee and its predecessor, the temporary Ad-Hoc Committee.
(4) Member of the Company Board of Directors and the RNGC as of 12 April 2017.
(5) Not a Member of the Company Board of Directors as of 12 April 2017.

4.2.2 Long-Term Incentives Granted to the Chief Executive Ofﬁcer

See “— 4.3.3 Long-Term Incentive Plans”.

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4.3 Employee Proﬁ t 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 2015, 2016 and 2017, 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 2017 and “— Notes to the
IFRS Consolidated Financial Statements — Note 8: Related
party transactions” for the year ended 31 December 2016, 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
4.3.1 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 managementof Airbus (see “— 4.3.3 Long-Term Incentive Plans”), andemployees were offered shares at favourable conditions within

the context of a 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 2017 AGM. Such powers include the approvalof ESOP.

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4.3 Employee Proﬁ t 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(1) / € 44.20(2)€12,113,245

29 July 2013

2014

(3)

2015

€ 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 2017(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.

In 2017 and 2016, the Board of Directors approved a new
ESOP scheme. Eligible employees were able to purchase aﬁxed number of previously unissued shares at fair market value(2017: 5, 20, 30, 50 or 100 shares; 2016: 4, 6, 10, 19, 38 or
76 shares). Airbus matched each ﬁxed number of shares witha number of the Company free shares based on a determinedratio (2017: 4, 8, 10, 13 and 25 free shares, respectively; 2016:
4, 5, 7, 11, 16 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 21 February 2017 (2016: 23 February 2016) and amounted

to € 67.24 (2016: € 55.41). 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 21 February 2017 (2016: 23 February 2016), resulting
in a price of € 64.44 (2016: € 54.31). The Company issued andsold 411,710 ordinary shares (2016: 485,048) with a nominal
value of € 1.00 each. Compensation expense (excluding social
security contributions) of € 28 million (2016: € 27 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.

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4.3 Employee Proﬁ t 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), the Board 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.
In 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 2017
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:

Fourteenth tranche
Date of Board of Directors meeting (grant date)

13 December 2012
Performance and Restricted Unit plan
Performance Units

Restricted Units

2,123,892

621,980

00

Mr. Thomas Enders*

50,300-the 10 employees having being granted
the highest number of units during
the year 2012 (fourteenth tranche)

251,800-

Number of units granted(1)Number of units outstanding
Units granted to:■■

Total number of eligible beneficiaries

1,797
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 2016;
25% expected in November 2016;
25% expected in May 2017;25% expected in November 2017.
■■■

Vesting dates
Number of vested units■

1,744,570

568,495(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 maximumof 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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Registration Document 2017 - AIRBUS
Corporate Governance
4.3 Employee Proﬁ t Sharing and Incentive Plans

Fifteenth tranche
Date of Board of Directors meeting (grant date)

13 November 2013
Performance and Restricted Unit plan
Performance Units

Restricted Units

Number of units granted(1)1,245,052

359,060

Number of units outstanding

440,591

167,386

Mr. Thomas Enders*

30,300-the 10 employees having being granted
the highest number of units during
the year 2013 (fifteenth tranche)

173,100-

Units granted to:■■

Total number of eligible beneficiaries

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.
■■■

Vesting dates■

Number of vested units

424,425

169,254(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”.

Sixteenth tranche
Date of Board of Directors meeting (grant date)

13 November 2014
Performance and Restricted Unit plan
Performance Units(1)

Restricted Units

1,114,962

291,420

834,572

275,070

Mr. Thomas Enders*

29,500-the 10 employees having being granted
the highest number of units during
the year 2014 (sixteenth tranche)

176,460

Number of units granted

Number of units outstanding
Units granted to:■■-

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

■

5,580

2,060

(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 Proﬁ t Sharing and Incentive Plans

Seventeenth tranche
Date of Board of Directors meeting (grant date)

29 October 2015
Performance and Restricted Unit plan
Performance Units

Restricted Units

Number of units granted(1)926,398

240,972

Number of units outstanding

890,248

238,386

Mr. Thomas Enders*

24,862-the 10 employees having being granted
the highest number of units during theyear 2015 (seventeenth tranche)

156,446-

Units granted to:■■

Total number of eligible beneficiaries

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.
■

Vesting dates■

Number of vested units

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”.

Eighteenth tranche
Date of Board of Directors meeting (grant date)

25 October 2016
Performance Units and performance shares plan
Performance Units(1)

Performance Shares

615,792

621,198

605,789

611,225

Mr. Thomas Enders*

14,24014,240the 10 employees having being granted
the highest number of units/shares during
the year 2016 (eighteenth tranche)

79,50485,200

Number of units/shares granted

Number of units/shares outstanding
Units/shares granted to:■■

Total number of eligible beneficiaries

1,671
The Performance Units and Shares will vest if the participant is still employed byan Airbus company at the respective vesting dates and, in the caseof Performance Units and Shares, upon achievement of mid-term businessperformance.
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

■

-

-

(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”.

4

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Registration Document 2017 - AIRBUS
Corporate Governance
4.3 Employee Proﬁ t Sharing and Incentive Plans

Nineteenth tranche
Date of Board of Directors meeting (grant date)

30 October 2017
Performance Units and performance shares plan
Performance Units

Performance Shares

Number of units/shares granted(1)421,638

425,702

Number of units/shares outstanding

421,638

425,702

Mr. Thomas Enders*

10,162

10,162the 10 employees having being granted
the highest number of units/shares during
the year 2017 (eighteenth tranche)

53,80857,872

Units/shares granted to:■■

Total number of eligible beneficiaries

1,601
The Performance Units and Shares will vest if the participant
is still employed by 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■■■

Vesting dates
Number of vested units

■

-

-

(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 DIRECTORSMember of the Board of Directors

Shareholding■

Mr. Thomas Enders

65,161 ordinary shares■

Mr. Denis Ranque

2,000 ordinary shares■

Ms. Catherine Guillouard

No other Member of the Board of Directors holds shares or other securities in the Company.

125 ordinary shares

REGISTRATION DOCUMENT 2017

161

4

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Registration Document 2017 - AIRBUS

Chapter5

REGISTRATION DOCUMENT 2017

163

Entity Responsible
for the Registration
Document

5.1 Entity Responsible for the Registration Document

164

5.2 Statement of the Entity Responsible
for the Registration Document

164

5.3 Information Policy

165

5.4 Undertakings of the Company regarding Information

165

5.5 Signiﬁcant Changes

165

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Registration Document 2017 - AIRBUS
Entity Responsible for the Registration Document
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 Registration Document is, to the best of the Company’s knowledge, in accordance with the facts and contains no omission
likely to affect its import.
Airbus SE represented by:Thomas Enders
Chief Executive Ofﬁcer

REGISTRATION DOCUMENT 2017165

Entity Responsible for the Registration Document
5.5 Signiﬁ cant Changes

5.3 Information Policy■

Contact details for information:
Ms Julie Kitcher
Head of Investor Relations and Financial Communication,
Airbus SE
2 rond point Emilie Dewoitine
BP 9011231703 Blagnac France
Telephone: +33 5 82 05 53 01
E-mail: ir@airbus.com■

Special toll-free hotlines are available to shareholders inFrance (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)■

An e-mail box is dedicated to shareholders’ messages:
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 5 April 2016;■
the Registration Document ﬁled in English with, and approved
by, the AFM on 4 April 2017; and■the Consolidated Financial Statements (IFRS) and theCompany Financial Statements of Airbus SE for the years
ended 31 December 2016 and 2017, together with the related
Auditors’ reports, may be inspected at the Company’s
registered ofﬁ ce at: Airbus SE, Mendelweg 30, 2333 CS
Leiden, the Netherlands, Seat (statutaire zetel) Amsterdam,
Tel.: +31 (0)71 5245 600.

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 this Registration Document, there has been no signiﬁcant change in the Company’s ﬁnancial or trading position
since 31 December 2017.

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Registration Document 2017 - AIRBUS