Having taken financial charges worth €2.2 billion in 2016, Airbus announced today it is seeking new talks with its government customers to obtain relief from financial penalties and red tape which put a great burden on the company. (RAF photo)
Chief Executive Tom Enders told reporters the aerospace group was still paying for the "original sin" of striking an unrealistic procurement deal when the plane was launched in 2003.
Airbus won a 3.5-billion-euro bailout from seven European NATO nations in 2010 after being saddled with liability for wild cost overruns on its engines.
The company said on Wednesday it needed more relief following fresh problems in supplying the troop and armored vehicle carrier's advanced defensive capabilities, which have led to new penalties and cash being held back by governments.
Hailed at the time as an innovative, fixed-price commercial-style deal, the contract foundered over the problems with the West's largest turboprop engines and an ambitious schedule for innovations such as ground-hugging technology to avoid radar.
The 2010 bailout included 1.5 billion euros to be repaid from exports that Airbus says are now looking more challenging. So far, the only non-European buyer is Malaysia.
Enders, who is said to privately regret not cancelling the project in 2010, declined to say whether Airbus would threaten to stop building the plane but denied that the project found itself in the same dire financial straits as seven years ago.
Nonetheless, he described the penalties as "inappropriate" given the fact that the aircraft was playing a key operational role in Africa and elsewhere. (end of excerpt)
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from Defense Aerospace - Press releases http://ift.tt/2mbVsXG
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