EADS Denies New A400M Aircraft Delay

February 23, 2009

European aerospace group EADS denied a report on Sunday that its A400M military aircraft project had been pushed back by another year as it seeks to reach a settlement with NATO governments about existing delays.

La Tribune business daily said that the plane commissioned by seven European NATO countries was unlikely to be delivered before late 2013.

It also reported disquiet in the military about a "lightweight" approach to managing the project.

Citing officials in France, which is the first European power due to receive the aircraft, the newspaper said military customers were doubtful about proposals for a three- or four-year delivery delay given by EADS subsidiary Airbus.

"We have analyzed the calendar of EADS and one more year will be required compared to the four announced," the newspaper quoted an unnamed French defense official as saying.

EADS denied drawing up a new delay and also rejected the same newspaper's suggestion that Airbus had assigned only a part-time project manager to lead Europe's largest military project.

It emerged, however, that Patrick Tramier, a senior executive at its MBDA missiles subsidiary, had been asked to coordinate contacts with the French government on the issue.

"As far as EADS is concerned, these statements do not correspond to any reality and only speak for the newspaper's sources and not for EADS," a spokesman said of the report.

"Patrick Tramier is not in charge of the A400M project but is simply in charge of contacts with the state on the A400M. The head of the A400M project is Rafael Tentor, under the head of Airbus Military and Airbus CEO Tom Enders," the spokesman said.

Tramier is the senior official in charge of MBDA programs. His career has included a spell in charge of France's Exocet missiles and a stint at France's DGA procurement agency.

The A400M was ordered in 2003 by seven European NATO countries to provide airlift for combat zones such as Afghanistan and for humanitarian missions from 2009.

The project has been hit by a row over engine delays, which could lead to severe financial penalties levied against EADS.

EADS said recently that the original target was unachievable and called for talks over a new timetable and contract as it faces potentially crippling penalties for late delivery.

Under its proposals, a first basic model of the plane would be delivered three years after the first flight of the A400M, which Enders says he expects in the second half of 2009.

A French Senate report said this month that the EUR20 billion euro (USD$25.15 billion) project was already effectively four to five years late because of the time needed to build up a meaningful fleet of operational aircraft.

EADS has taken provisions for over EUR1.7 billion for the delays and is negotiating with European governments led by France, Germany and Britain to ease the delivery penalties.

The EADS spokesman said its proposals included a new organization for the multinational project.

Analysts say the problems facing Europe's most ambitious cross-border arms procurement are increasingly political and could be discussed on the sidelines of a NATO summit in April.

US firms Lockheed and Boeing are both seen positioning themselves to make further sales of military transport aircraft should the A400M project unravel.

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