EADS Backs A400M But Contract Unrealistic

Aerospace group EADS said on Monday it remained committed to the A400M aircraft after the head of its Airbus unit was quoted as saying it may not be able to complete the military transport plane.

"EADS confirms that it remains fully committed to the construction of the A400M," the company said in a statement.

The A400M is a EUR20 billion euro military program that is running 3-4 years late, according to the manufacturer, and 5 years late according to at least one of the 7 European NATO nations that ordered the plane to renew aging transport fleets.

"The group reaffirms that the contract signed in 2003 does not provide the necessary conditions for the successful development of the program," EADS said, citing an "unrealistic timetable."

"EADS wishes that the three months moratorium period as proposed by OCCAR be used by all partners of the program to put it back on tracks within conditions acceptable by all parties," EADS the Franco-German-Spanish aerospace group said.

OCCAR is the cross-border agency that centralized the European order for 180 planes. Another 12 were sold for export.

Airbus chief executive Tom Enders was quoted as saying in Spiegel Online in an interview on Sunday that the planemaker could not build the A400M "under the current conditions," and added it would be better to make a painful break than draw out the agony.

Enders was quoted as saying he would not make a "pilgrimage to Berlin or Paris to plead for a continuation of the program under conditions that are not acceptable to us."

Airbus has blamed the delays on the companies supplying the A400M's massive turbo-prop engines. The Toulouse-based firm faces a risk of billions of euros in penalties for the delays.