Delta Cuts Outlook, Refuses To Pay Tariff On Airbus Jets

Airbus aircraft shipments from Europe to the U.S. now face tariffs of approximately 20%. This poses a significant challenge for Delta Air Lines, which scrapped its full-year financial guidance amid rising uncertainty in global trade.

Delta Chief Executive Officer Ed Bastian told investors during an earnings call earlier that he has been “very clear” with European manufacturer Airbus: The airline would defer any deliveries subject to the additional tax. The carrier is working with France-based Airbus to mitigate the impact of the tariffs. 

“We will not be paying tariffs on any aircraft deliveries,” Bastian said Wednesday on the earnings call, adding, ”These times are pretty uncertain, and if you start to put a 20% incremental cost on top of an aircraft, it gets very difficult to make that math work.”

Bernstein analysts told clients they expect U.S. airlines to push for delivery delays. They estimate the effective tariff rate on European aircraft shipped to the U.S. to be around 20%.

Bastian’s comments come after Delta withdrew its full-year financial guidance but anticipates a profit this year. The airline declined to reaffirm an earlier forecast at the start of the year when it forecasted annual adjusted earnings would exceed $7.35 a share. 

“With the level of uncertainty we’re seeing and the amount of changes happening on a daily basis in global trade, it’s very difficult to predict what policies may look like over the course of the year,” CEO Bastian told analysts. 

According to company filings, Delta has 490 Airbus planes in its fleet and orders for nearly 200 more. The airline only plans to take ten aircraft in 2025 as part of a pullback. 

TD Cowen analyst Tom Fitzgerald said, “The airline sector is in the eye of the storm, but we believe Delta to be a better port in the storm than many peers due to its revenue diversity and balance sheet strength,” adding the carrier’s decision not to reaffirm its full-year forecast is “prudent.” 

Several airlines recently warned that global turmoil has already pressured domestic demand. Bastian told analysts that he would closely monitor whether travel was pulling back. 

Data from Goldman analysts showed a sharp drop in international travel to the U.S. following the escalation of the trade war. 

Foreign Travelers Boycott USA After Tariff War Erupts https://t.co/qN7xjbqYxB

— zerohedge (@zerohedge) April 9, 2025

CEO Bastian pointed out that this current environment is very different from the pandemic when governments shut down the global economy. 

“Having lived through that experience, I would not call this bleak by any means. It’s more uncertainty,” he said, adding, “As a result of that, growth has stalled.”