Key Moments
- Bank of America cut its Airbus price target to €255 from €259, while reiterating a Buy rating.
- Strikes on Gulf aluminum smelters have pushed LME aluminum prices up about 6% since the attacks and roughly 15% from pre-war levels.
- Bank of America now sees Airbus facing inflation headwinds of €100 million in 2026 and €200 million in 2027, with lower delivery and EBIT forecasts.
Aluminum Supply Shock Triggers Target Price Cut
Investing.com — Bank of America lowered its price target on Airbus to €255 from €259 but left its Buy rating unchanged, warning that aluminum supply disruptions are set to pressure the aircraft manufacturer’s cost base.
The bank cited the impact of disrupted aluminum supplies following strikes on smelters in the Gulf region as the main driver behind the revised valuation and updated financial forecasts.
Gulf Smelter Strikes Hit Key Producers
Iranian missile and drone strikes hit aluminum facilities in the United Arab Emirates and Bahrain over the weekend. The attacks damaged the Al Taweelah site in Abu Dhabi, operated by Emirates Global Aluminum, and the Alba facility in Bahrain.
Following the strikes, Alba declared force majeure on deliveries, highlighting the severity of the disruption to its operations.
The two facilities produced approximately 1.6 million metric tons of aluminum each in 2025, accounting for roughly 4% of global aluminum supply.
Aluminum Market Reaction
The supply shock has already filtered through to pricing. LME aluminum prices rose approximately 6% since the strikes and are up around 15% from pre-war levels.
| Metric | Detail |
|---|---|
| Al Taweelah output (2025) | Approximately 1.6 million metric tons |
| Alba output (2025) | Approximately 1.6 million metric tons |
| Share of global aluminum supply | Roughly 4% |
| LME aluminum move since strikes | Approximately +6% |
| LME aluminum vs pre-war levels | Up around 15% |
Implications for Airbus Costs and Margins
Bank of America expects the aluminum supply disruption to drive cost headwinds for Airbus through 2026 and 2027. The firm now projects inflation headwinds of €100 million in 2026 and €200 million in 2027, and sees price-cost neutrality in 2026 as unlikely.
Reflecting anticipated ongoing supply chain issues, the bank lowered its Airbus delivery forecasts to 860 aircraft in 2026 and 960 in 2027. It also shifted its expected timing for a gross margin inflection on the A350 program out by one to two years.
| Airbus Outlook (per Bank of America) | 2026 | 2027 |
|---|---|---|
| Inflation headwinds | €100 million | €200 million |
| Aircraft deliveries | 860 | 960 |
| EBIT estimate change | 5% to 8% reduction (vs prior) | 5% to 8% reduction (vs prior) |
Earnings Impact and Current Share Price
These forecast changes translated into a 5% to 8% cut to Bank of America’s EBIT estimates for 2026 and 2027.
Airbus shares traded at €159.18.
TradingPedia.com is a financial media specialized in providing daily news and education covering Forex, equities and commodities. Our academies for traders cover 
