Source: Engineering News;
?20bn military aircraft programme under strain
European media have reported that EADS CE Louis Gallois - EADS owns Airbus, of which Airbus Military is a subsidiary - has written to the governments of seven of the countries which have ordered the aeroplane, appealing to them not to enforce the penalty clauses for late delivery of the A400M.
The reports quote Gallois as writing that the A400M is "a heavy lossmaker" which is causing "considerable difficulties" for EADS, in terms of the group's financial performance. The "anticipated profits" from the sale of the first 180 aircraft have already been "invested" and the current situation could become "untenable" in a matter of months, unless an agreement can be concluded that "keeps everyone happy." If such a deal cannot be reached, and if the customer countries refuse to waive the penalty payments for late delivery, EADS is warning it will freeze production of the A400M.
Initial reports state that Germany is unsympathetic, taking the view that "financial concessions" can only be debated once the aircraft have been delivered. The reactions of the other countries were not known at this publication's deadline. Britain has already bought Lockheed Martin C-130J new generation Hercules tactical, and Boeing C-17 Globemaster III strategic, transports because of delays in the A400M programme.
Given the country's heavy commitment to combat operations in Iraq and especially Afghanistan, it is not in conceivable that it could respond by reducing its order for A400Ms and acquiring more of the American aircraft, which are already serving with great success.