By Tim Hepher

PARIS (Reuters) -Jet engine maker Safran (PA) While declaring that the worst was behind them, they took a more cautious approach to long-term aviation traffic. This is despite a ongoing standoff between Airbus and the Department of Transportation over the proposed increase in production.

French aerospace supplier Zodiac Aerospace also underwent a review of almost a quarter of the recently acquired Zodiac Aerospace, and is aiming to achieve higher revenues over the five-year period.

Olivier Andries, CEO, stated that Safran was committed to building enough engines for Airbus to reach a target of 65 A320s per month by 2023. This is an increase of some 50% over crisis-hit levels. However, it was still too early to make any commitments to build more.

Airbus requested suppliers to look at rates up to 75 per mois by 2025 in light of its predictions that strong demand will emerge for medium-haul as the pandemic ends.

Mid-2022 would be the ideal time to make a decision.

Airbus is the largest planemaker by volume. Engine manufacturers are wary of joining them in increasing new production because it could accelerate retirements or dampen demand for lucrative repairs, or be too short-lived.

Safran produces engines for single-aisle categories with General Electric (NYSE:) through their joint venture CFM, which according to Safran has 72% of the market against rival Pratt & Whitney, owned by Raytheon Technologies (NYSE:).

Andries stated that Safran expects growth in medium-haul air traffic for A320s, Boeing (NYSE:), 737s between 2023-2025.

The 20-year-old annual growth in all traffic would mean that medium-haul will see the most growth, at 2.9%. This compares to Airbus’ forecasts of 4% and Boeing’s close to 4%.

Andries stated that they have a demand vision more prudent than planemakers. He added, “3% isn’t nothing. It is very significant, and it will remain above the world GDP.”

Safran said that targeted acquisitions are possible where it makes sense. However, he also considered the possibility of selling some ex-Zodiac activity.

Safran purchased Zodiac by purchasing it in 2017. This was after the company had reduced its offer due to profit warnings.

Safran stated that 70% of the company’s legacy Zodiac business was “confirmed to be core” and 30% were under review prior to a presentation for investors on Thursday.

Safran did not identify the under-review activities. However, Pascal Bantegnie, newly appointed CFO, suggested recently that less financially profitable or weakly protected activities may be sold.

Safran Cabin, and Safran Seats have been renamed. These businesses are part of Aircraft Interiors division. Both will breakeven in 2022, double-digit profit by 2025, and they “take advantage” of recovering markets.

Safran also set out group goals for the 2021-2025 period, which included compound average growth rates of at least 10% in revenues and approximately 15% in the highly watched aftermarket for civil aircraft engines.

It predicted an operating margin of 16-18% in 2025. In 2022, it said that the dividend would be returned to 40% for 2022.