Airbus to Cut 10,000 Jobs Over Four Years
Airbus said it will cut 10,000 jobs over four years as part of a restructuring plan aimed at helping the planemaker overcome costly delays to its A380 superjumbo and the effects of a weaker U.S. dollar.
The European aircraft maker said it planned to offer to investors its Meaulte plant in France, Nordenham in Germany and Filton in Britain. It said it had already received bids.
Three other sites -- Saint-Nazaire-Ville in France and Varel and Laupheim in Germany -- are to be sold or closed, Airbus said.
Toulouse, France-based Airbus will shed a total of 4,300 jobs in France, 3,700 in Germany, 1,600 in Britain and 400 in Spain, Chief Executive Officer Louis Gallois told a news conference. Half of the cuts will come from within the 56,000-strong Airbus work force and the rest from subcontractors, he said.
The "Power8" restructuring program was first announced last year after a two-year production delay to the double-decker A380 wiped 5 billion euros ($6.6 billion) off profit forecasts for 2006-2010. The program aims to claw back the same figure in cost reductions over the period and generate 2.1 billion euros ($2.8 billion) in annual savings in later years.
Airbus has been badly hit by the weakness of the U.S. dollar -- the currency in which its planes are priced -- and is expected to shift more of its supplier costs and contract work to dollar-linked economies as part of the restructuring effort.
It also has to fund development of the A350, its 11.6 billion euros ($15.3 billion) answer to the runaway success of U.S. rival Boeing Co.'s 787 in the lucrative market for long-range, mid-sized planes.
Final assembly of the A350 will be based exclusively in France, Gallois said, instead of being split between Germany and France as programs traditionally have been.
In return, an additional A320 final assembly line will be opened in Germany and a future revamp of the single-aisle plane will be assembled in Hamburg.
Between France and Germany
Gallois was forced to postpone the restructuring announcement, originally scheduled last week, and propose changes to the plan after the main EADS shareholders failed to agree on the distribution of job cuts and new technologies between France and Germany at a Feb. 18 board meeting.
Core German shareholder DaimlerChrysler AG's 22.5% share of voting rights is matched by the combined EADS stake held by the French government and Paris-based Lagardere SCA. Unlike the French state -- which owns 15% -- Berlin has no direct stake in the company but leans heavily on decision-making as its largest single defense customer.
German Economics Minister Michael Glos, who earlier this month said EADS could lose defense contracts if it cut too many jobs in the country, said the burden of restructuring appeared to have been spread fairly.
"We have been successful in asserting German interests regarding Airbus, regarding employment in Germany," Glos said during a cabinet meeting, in comments later relayed by government spokesman Thomas Steg.
The A350's increased use of composites had cast a cloud over the future of Germany's Nordenham plant, where over 2,100 workers produce metal fuselage panels for current Airbus models.
Shares of European Aeronautic Defence and Space Co. fell as much as 3.7% in early trading but later recovered most of their losses. Shortly after the announcement, the stock was trading at 25.32 euros ($33.45), 0.5% below Tuesday's close.