France sees A400M response by June

[tigershark]

France sees A400M response by June
Reuters, Thursday January 22 2009


(Adds comment from EADS chief)
By Sophie Hardach
PARIS, Jan 22 (Reuters) - France will ask European customers of the Airbus A400M military transport project to assess the impact of the latest delays proposed by the manufacturer, and expects an answer by June, a French defense official said.
France, one of seven European NATO countries that originally ordered the A400M, is in talks with Airbus parent EADS over the timetable and financial terms after the group this month proposed lengthening output delays to three to four years, from two.
French Defense Minister Herve Morin will tour France's European partners and ask them to assess the financial and operational consequences of the delay, said Gen. Christian Baptiste, deputy spokesman at the defense ministry.
"We expect them to express their position -- be it a joint position or an individual one -- by the end of Spring," he said after a press briefing at the ministry, adding that Spring ran from March to June.
France has insisted that EADS provide a reliable new timetable as a basis for negotiations.
Analysts say the mounting delays could lead to further provisions on top of 1.7 billion euros ($2.21 billion) in charges already taken by EADS, but the decision rests on agreement on a new schedule.
EADS Chief Executive Louis Gallois told Reuters he did not know when such a schedule would be released.
"There is no answer at this moment; we will see," he said on the sidelines of a conference in Paris, adding that there were constant meetings with EADS partners in the project.
"It's a discussion, it's not yet a negotiation," he said.
Germany, Britain, Spain, Belgium, Luxembourg, Turkey and France ordered 180 of the A400M planes in 2003 in Europe's largest single arms purchase.
Export clients Malaysia and South Africa have ordered 12.
But the 20 billion euro ($25.98 billion) project has suffered from delays in building its huge turbo-prop engines.
Gallois last week said EADS could not assess the financial impact of further delays until a new schedule had been agreed but that he hoped for a quick agreement.
EADS faces paying heavy penalties to governments forced to rent or buy other planes to compensate for the delay.
Germany -- taking the toughest line in public so far -- has said it would pursue its claims for damages from EADS, while Britain has called the latest proposed delay "unacceptable" and is looking at acquiring more C-17 Globemaster cargo planes from Boeing.
"We have to prepare an exhaustive study of how to mitigate this delay," the French defence ministry spokesman said.
The A400M was due to enter service with France in 2009.
Airbus has said the planes will not be ready before 2012 and blames the delays on engine makers who are developing the West's largest turbo-prop engine for the aircraft, which is due to be deployed in Afghanistan.
The engine consortium led by Rolls Royce and France's Safran has hit back by blaming Airbus for the delays. ($1=.7697 euros) (Reporting by Sophie Hardach, editing by Mike Nesbit and Rupert Winchester)


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