Airbus A380 cost overruns of 1.45 bln euros
EADS sees Airbus A380 cost overruns of 1.45 bln eur
Wed Dec 15, 2004 05:10 AM ET
MUNICH, Germany, Dec 15 (Reuters) - Planemaker Airbus's A380 superjumbo project is running 1.45 billion euros ($1.93 billion) over budget because of work to improve the efficiency and weight of the aircraft, the co-head of parent company EADS said.
Total costs for the mammoth doubledecker are currently estimated at over 12 billion euros, EADS German co-chief Rainer Hertrich said late on Tuesday in comments embargoed until Wednesday.
"That (the extra costs) is indeed a lot, that is indeed hefty," Hertrich told journalists in Munich, Germany. The extra costs cover the entire A380 development project, including a freight version by 2008, he added.
An EADS spokesman said on December 7 that the A380 was on track for entry into service in 2006 and that the overall programme would achieve a target of an internal rate of return of 20 percent -- despite acknowledging possible cost overruns.
Analysts at brokerage Lehman Brothers had said in a note to investors that Airbus was running 500 million euros over budget.
Hertrich said on Tuesday that the A380 will be presented on January 18 and added that the company was sticking to its target for the aircraft to take off for the first time by the end of March.
The A380 is set to eclipse Boeing Co.'s 747 jumbo as the world's biggest airliner, with seating for 555 passengers or more depending on layout.