Airbus Delays Restructuring Announcement
Airbus said Monday it postponed a news conference at which it had been expected to announce its long-awaited restructuring strategy.
The European aircraft maker also canceled meetings with unions planned for Tuesday after shareholders of parent European Aeronautic Defence and Space failed to reach agreement on key points of the plan, dubbed "Power8."
EADS said in a statement that a meeting of its board ended without conclusion late Sunday. The meeting, which had been expected to give final approval to the restructuring plan, failed to produce agreement on the "national sharing of the industrial workload related to the A350XWB," a planned mid-size Airbus jet, the statement said.
"I made proposals which I deem balanced, both from an industrial and a technological point of view, and which serve our objective of economic competitiveness," Airbus CEO Louis Gallois said in a statement. "I wish that they can lead to the consensus we urgently need."
According to a report in French financial newspaper Les Echos, the European aircraft maker plans to cut as many as 12,000 jobs, with France and Germany each losing between 3,000 and 4,000, and sell off some production facilities.
Besides the job cuts, the location of final assembly plants is a highly sensitive political issue. Airbus has traditionally split assembly work between France and Germany but has been reviewing the practice as it seeks ways to save transportation costs and time.
Les Echos and rival financial daily La Tribune -- which put the figure of planned job cuts at up to 10,000 -- both reported that Airbus CEO Louis Gallois is seeking to base final assembly of the A350 in France, with the planned next generation of the single-aisle A320 to be built in Germany. Neither paper cited sources.
Airbus is struggling to recover from a costly two-year delay to its double-decker A380 superjumbo program while funding development of the A350, a belated rival to Boeing's 787 -- which has steadily won business from Airbus in the lucrative market for long-range, mid-size planes.
The A380 delays wiped about 5 billion euros ($6.5 billion) off profit forecasts for 2006-2010, and the Power8 plan seeks to claw back the same figure in cumulative savings over the same period, generating annual savings of 2 billion euros ($2.6 billion) thereafter.
Besides the production crisis, Airbus has been badly hit by the weakness of the U.S. dollar -- the currency in which it bills its aircraft sales -- and is expected to shift more of its supplier costs and contract work to dollar-linked economies, as part of the restructuring effort.
The French government and Paris-based Lagardere together hold a 22.5% stake in EADS, and Germany's DaimlerChrysler AG recently sold a 7.5% stake in the defense group to a group of banks, reducing its holding to 15 percent.
Shares of European Aeronautic Defence & Space were up 2.1%t to 25.65 euros ($33.71) in Paris.