Aerospace suppliers are staring at the prospect of dwindling cash flow as they struggle with excess inventory due to production challenges at top planemakers Boeing Co and Airbus SE .
A rebound in global air travel has left the two planemakers scrambling to meet demand but labor and shortages of engines have held them back from ramping up production.said earlier this month a "challenging environment" is "putting a lot of pressure on our ability to generate cash".
Global supply chains have been roiled by disruptions and rising inflation in the wake of the pandemic, deepening risks for manufacturers depending on a fragmented network of parts makers. The war in Ukraine has only amplified the industry's headache, with companies such as French jet engine maker Safran SA"The problem is just-in-time inventory does not work at the current environment, because there are too many uncertainties," Morgan Stanley analyst Kristine Tan Liwag said.
Some suppliers are also stocking parts in anticipation of jet output hikes next year as they look to speed up their recovery from one of the worst crises the industry has faced in modern times.
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