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A400M Rollout

The big boss at EADS responds to Enders:

EADS chief softens line over A400M
http://www.ft.com/cms/s/0/fc4deb86-1d5a-11de-9eb3-00144feabdc0.html

EADS chief softens line over A400M

EADS is prepared to accept a limited cut in orders for the A400M military transport plane, in a bid to keep Europe’s biggest defence contract alive as government clients grow restless over rising costs and long delays.

Louis Gallois, EADS chief executive [Airbus is part of EADS], said for the first time that a limited reduction in orders would be “manageable” for the Franco-German aerospace group [emphasis added].

However, he said any significant cut would have “an impact on the price of the planes” – a clear signal to the seven governments that launched the troublesome €20bn project in 2003 that they should not push too hard for concessions.

Mr Gallois’ comments came as EADS sought to reassure customers and the market that it remained committed to the A400M programme, already €2bn over budget and three years late.

Doubts over EADS’s determination to continue with the programme were raised at the weekend by Tom Enders, head of the group’s aircraft arm Airbus, who suggested in an interview with Der Spiegel magazine
http://www.spiegel.de/international/business/0,1518,616296-2,00.html
that he would rather scrap the programme than continue under the current contract...

This month, the governments agreed to a three-month moratorium on cancellations from today to allow the talks to go on.

But talks come as the enthusiasm of some of the original customers – notably Germany and the UK – for the aircraft may be waning.

Mr Gallois said on Monday he was confident a solution would be found. The EADS chief appears to be betting that politicians will put pressure on defence ministries to resolve the disagreements over penalties to preserve jobs in a highly sensitive sector.

“This programme is going to fly because the defence and industrial challenges are considerable,” he said. “They need this plane and it is also about 40,000 highly qualified jobs in Europe. We have to find a solution together.”

Nonetheless, the UK government, which ordered 25 aircraft and urgently needs a new transport aircraft for operations in Afghanistan, increased pressure on EADS on Monday, warning it would “not be content with a gap in capability”.

John Hutton, secretary of state for defence, told MPs the delays were a “matter of extreme regret” that posed “very serious questions” about the future of the UK’s military logistics capabilities.

He said the government would decide whether to go ahead with the programme at the beginning of July but warned: “We will not be content with a gap in capability.” The UK is considering options to bridge the delivery gap, including extending the out-of-service dates of the ageing C-130 Hercules aircraft, and buying more C-17s from Boeing, the US jetmaker.

Mr Gallois said he expected Airbus to deliver a new timetable to customers after agreeing a delivery date for the propulsion system software, known as Fadec.

Slowly, slowly twisting...

Mark
Ottawa
 
this has to hurt Euro pride . . . 


"France is believed to have officially requested pricing and availability data on Boeing's C-17 strategic transport to bridge a capability gap caused by development delays to the Airbus Military A400M.

Defence ministry officials wrote to the US Air Force on 25 March enquiring about a possible future acquisition of three C-17s, says an industry source. It is unclear whether Paris could be interested in options on an interim lease agreement or a direct purchase"

http://tinyurl.com/cc3fad


 
France is / was on the hook for some 50 x A400s.
Their fleet of Transall airtransporters are something like 40 yrs old
http://www.opex360.com/2009/01/12/les-transall-en-ont-encore-pour-3-ans-de-service-voire-plus/
They expect a minimum of 3 more years before anything more happens on the A400 front - so YES, it makes perfect sense for them to go shopping at Boeing for some new C17s
 
France is retiring something like 3 Transalls each year.
Here are a couple of pics of one partly dissasembled one going to the boneyard

http://secretdefense.blogs.liberation.fr/defense/2009/03/cest-ainsi-que.html
 
Good summary from The Economist:

Heavy going
The future of Europe’s high-tech military transport hangs in the balance

http://www.economist.com/business/displaystory.cfm?story_id=13447375

Mark
Ottawa
 
Maybe this guy should write about our acquisition process, maybe the JSS, or Jercs or Chinooks,or ???



"This smug, overpaid, cerebrally-challenged excuse for a human being has the unmitigated gall to tell us that the heap of machinery he is trying to palm off as an aeroplane should be kept going because 40,000 jobs in Europe are directly linked to the project, including 15,000 in Spain. "You can't just look at the plane as a product," he says.

Notwithstanding that any aerospace manufacturer who calls an aircraft a "plane" should not be allowed to live, what this human garbage needs to understand is that the A400M is a product, a machine that is supposed to do things, very specific things, one of which is to fly. It is not a job creation scheme for euroweenies. Furthermore, it is a product that was promised by his dismal excuse for a company and one which it has singularly failed to deliver.

"Are budget restrictions going to put at risk the programme, which still needs investment?" Enders asks the Spanish newspaper ABC. "It means asking if Europe is prepared to not go ahead with the A400M and what alternatives there are."

Wrong questions. "Europe" is not an entity – it is a continent. The people who have the misfortune to be saddled with this overpriced, non-performing heap of junk are soldiers, and they need military airlift, not computer-generated pictures. If he can't deliver – and it is very clear that he cannot – then there are companies that can – on time, to price and to specification.

That is the crunch. It is about time the defence contracting industry woke up and smelt the coffee. The purpose of military equipment is to equip the military, for the sole purpose of enabling that said military to do its job. It is not there for any other purpose and, if the industry cannot deliver, on time, to price and to specification, then it needs to go to the wall.



rtr @  http://eureferendum.blogspot.com/2009/04/let-it-fail.html

 
Recent developments:

April 17:

Boeing lurks as A400M flails
http://www.defencemanagement.com/news_story.asp?id=9222

As the A400M programme continues to struggle with delays and cost overruns while making pleas for more money from prospective buyers, Boeing is quietly waiting in the wings, hoping to secure any business that departs EADS.

Nowhere was this more evident than at a NATO summit earlier this month when French defence officials enquired with Boeing about the potential purchase of several C-17s. The French insist that they are committed to the A400M programme, but the possibility of a reduced order is more likely now than a year ago.

Boeing executives in recent months have discussed publicly how quickly they could deliver C-17s.

French procurement officials admitted that talks were taking place with Boeing over the C-17 but that other options were being reviewed as well.

"There is an operational gap for military transport and the French defence ministry is looking forward and studying all the transitional solutions. The C-17 is one of them, but there are several other options and nothing is decided at the moment," the DGA, France's defence procurement arm, said in a statement recently.

South Africa, another partner in the A400M programme has confirmed that it too is reviewing the purchase of C-17s along with the possible purchase of Russian aircraft or the Brazilian C-390. Frustration is growing in their defence ministry over the lengthy delays.

Britain has not said whether it will ditch the A400M for the C-17 or another option, but the French and South African leanings will surely play a role. The RAF has confirmed in recent months that any contingency plan if the A400M fails would include the purchase of C-17s and C-130s.

France's open discussions with Boeing and South Africa's open hostility towards the troubled A400M may have created an opening for Britain to begin purchasing talks with Boeing without sharp criticism from EU partners.

The company may be the only winner from the A400M programme.

April 23:

Boeing expects 'significant' C-17 orders
http://www.theglobeandmail.com/servlet/story/LAC.20090423.RTICKERA23ART1935-5/TPStory/TPBusiness/America/

Boeing Co. BA-N expects to win orders for a "significant" number of C-17 transport aircraft this year from international customers, countering declining interest from the U.S. military. "I think we'll see decisions by a number of customers in the near term, by the end of this year," Boeing Integrated Defense Systems president Jim Albaugh said. "We're not talking one or two airplanes; we're talking a significant number of airplanes." Boeing C-17s are also used by the U.K., Canadian and Australian militaries to transport troops and equipment. BA (NYSE) rose 65 cents to $37.30.

April 21:

EADS gets three-month moratorium on A400M
http://www.reuters.com/article/companyNewsAndPR/idUSLL9993520090421

Seven countries have signed a three-month moratorium on the A400M military plane, a French Defence Ministry spokesman confirmed on Tuesday, formalising a reprieve which was offered to planemaker Airbus last month.

Seven countries -- Britain, France, Germany, Spain, Belgium, Luxembourg and non-EU member Turkey -- had in March agreed a three-month moratorium to prevent automatic cancellation of the 20 billion euro ($25.81 billion) contract.

For Airbus, which is owned by EADS, the moratorium is a reprieve amid a delay in delivery of the A400M military transport plane, with governments deliberating whether to scrap Europe's biggest arms project.

The seven countries have ordered a total of 180 of the A400M planes, and some countries, notably Germany and Britain, have expressed anger over delays of 3-4 years on the delivery of the plane, which could cause billions of euros in penalties.

April 23:

MPs criticise MoD over A400M
http://www.defencemanagement.com/news_story.asp?id=9267

MPs have turned up the heat on the government over the troubled A400M programme, demanding that it be scrapped in an effort to help the MoD's long term procurement budget.

The programme is already four years late and will most likely create a huge gap in the MoD's strategic airlift capability.

MPs used a debate in the Commons on defence procurement to express their frustrations with the government over the stalled programme.

Conservative MP Ben Wallace gave the most blistering attack saying that there was no need for the project in the current MoD budget.

"The only defence for continuing to purchase it that I can see at the moment came from the French Defence Minister when he gave evidence to the Senate in March. He said, "We have to have it, because we must have some competition for the Hercules." That was the only answer," Wallace said.

Bernard Jenkin, a member of the select committee said that figures he uncovered showed that the MoD would have gotten better value for money from another aircraft.

"The failures of the Ministry of Defence's procurement programme are manifold and too numerous to discuss in detail," he said

Jenkin pointed out that like the Eurofighter Typhoon programme which is also a pan European programme, the A400M is in trouble because of international political compromises which almost never benefit Britain.

According to figures he uncovered from the MoD, the ministry has already spent £564m on the programme and is due to spend a further £1.5bn in the next three years. Buying 25 C-130s at a cost of £1.1bn would have saved the MoD considerable amounts of money he said.

Other MPs were equally angry over the delays and costs.

"[Money] has been wasted on the likely-to-be-aborted A400M, and the grand total runs into megabucks. Such expenditure makes the Army look like poor cousins," Lady Ann Winterton said...

Mark
Ottawa
 
I've said this before, and I'm no expert in defence procurement, but AIRBUS had the gall to want to sue Canada because we didn't pick this white elephant as our tactical fixed wing aircraft, but went with the tried and true Herc.
I'm very glad to see common sense prevailed in purchasing the C17 and the C-130J. That doesn't always happen, does it?
 
With regards to Enders though, far from being obnoxious, have you considered that possilbly he wants to enrage the folks enough that they do cancel.  He has a no-win airframe that he cannot possibly price high enough or sell enough to get out from under.  He has a contract that is going to cost him megabucks if he does have to bailout.  By enraging e.g. the Brits and others maybe he can get them to cancel and negotiate the cancellation charges.  He may be very smart and not very stupid and arrogant....naw or maybe....
 
At the rate this is going the A400M will have the payload of a Jerc, the price of a C17 and a never ending financial support requirement from already over taxed European taxpayers.

I'm waiting for the Ottawa tall foreheads and media types that flogged this dog, back when the Heavy Lift was being procured, to come clean and admit they were sooooooooooooooooooooooooooooooo  wrong. 

Such brilliance from our vaunted defense journalists who wrote flattering article after flattering article comparing the 17 to the 400 as if the 400 actually existed and various politicians who caved when pressured by Quebec aerospace interests.

They were fools then and are silent fools now, never to be trusted again.
 
Haletown you'll never hear a word from the European loving media or the politicians.
 
Boeing lurks as A400M flails
http://www.defencemanagement.com/news_story.asp?id=9222

Quote
As the A400M programme continues to struggle with delays and cost overruns while making pleas for more money from prospective buyers, Boeing is quietly waiting in the wings, hoping to secure any business that departs EADS.

Nowhere was this more evident than at a NATO summit earlier this month when French defence officials enquired with Boeing about the potential purchase of several C-17s. The French insist that they are committed to the A400M programme, but the possibility of a reduced order is more likely now than a year ago.

Boeing executives in recent months have discussed publicly how quickly they could deliver C-17s.

French procurement officials admitted that talks were taking place with Boeing over the C-17 but that other options were being reviewed as well.

"There is an operational gap for military transport and the French defence ministry is looking forward and studying all the transitional solutions. The C-17 is one of them, but there are several other options and nothing is decided at the moment," the DGA, France's defence procurement arm, said in a statement recently.

South Africa, another partner in the A400M programme has confirmed that it too is reviewing the purchase of C-17s along with the possible purchase of Russian aircraft or the Brazilian C-390. Frustration is growing in their defence ministry over the lengthy delays.

Britain has not said whether it will ditch the A400M for the C-17 or another option, but the French and South African leanings will surely play a role. The RAF has confirmed in recent months that any contingency plan if the A400M fails would include the purchase of C-17s and C-130s.

France's open discussions with Boeing and South Africa's open hostility towards the troubled A400M may have created an opening for Britain to begin purchasing talks with Boeing without sharp criticism from EU partners.

The company may be the only winner from the A400M programme.

Am surprised that anyone would be talking about the Embraer C-390 / KC-390

While the Brazilian gov't has poured a bundle into the project, there are no prototypes flying (from what I can googlefu) making the C-390 no more of a sure thing than the A400M.

I would surmise that countries would be looking for something that is NOW available VS something that may become available in the mid to long term.
 
The Embraer C-390 / KC-390 qualifies only as a P3

Power
Point
Plane

Nice idea, lotsa water will flow under that bridge between the now plan and the then plane.
 
The latest missive from EADS.  Nice story, but I have this feeling it was woven around a few facts and then put through the Spin cycle a few dozen times so that it has market appeal.  No mention of the other problems, like a significant over weight issue that compromises mission flexibility.

This is a program that is still in the woods, despite the soothing words from the bosses.

Still looks like the revised program costs will result in a plane that has about half the C17 payload for a price that will be almost the same.




http://tinyurl.com/qy3yyw

 
missed this , from the comments section on that article.  OUCH!!

""How anyone could have made such an error, nobody is quite sure."

Pretty simple, really. After chasing the moving target of power requirements all the way up from 7,500shp to 11,000shp, two engine consortia that were previously battling each other tooth & nail are suddenly taken into a small room and told to team-up overnight in order to avoid the Canadians getting the contract...leading to a four partner engine consortium spread across six nations which agreed to a development schedule that was never EVER going to happen, even in the best case, unobtainium-enabled scenario.

What could go wrong?"

 
order to avoid the Canadians getting the contract...

Who wouda thought?

Still does not mean that they will cooperate any more than before.
 
Bloomberg Financial Reports via the Seattle Times.

Some serious financial pain, no end in sight.  Gotta be a major hurt for EADS.


"Delays to the A400M resulting from engine-design problems led EADS to record a charge of 120 million euros in the first quarter, and the program remains the company's greatest financial risk, with a "high level of uncertainty," it said.

The transport plane is running at least three years behind a planned delivery schedule, and EADS is negotiating with seven countries that ordered 180 planes in 2003 as it seeks a new contract in which governments would shoulder more of the risk."



rtr  @  http://tinyurl.com/o5mj46

 
The seemingly endless agony continues :o--I wonder what the Brits will do:
http://www.nytimes.com/2009/06/12/business/global/12airbus.html?_r=1&ref=business

France and Germany said Thursday that they were giving themselves another six months to decide whether to proceed with Airbus’s troubled A400M military transport plane, prolonging the agony — and the costs — for the European aircraft manufacturer, which is already grappling with the worst industry downturn in decades.

The airlifter — the single biggest financial threat to the Airbus parent European Aeronautic, Defense & Space — is years behind schedule and has already cost Airbus some €2.4 billion, or $3.4 billion, in write-downs since 2006. The company missed a March 31 deadline for achieving its first flight, and would be exposed to €5.7 billion in penalties if the seven governments backing it decide to write the project off. The deadline for their decision had already been extended once, to the end of this month...

But it was unclear whether the delay had been cleared with London. Britain’s Ministry of Defense said only that it still expected a decision to be reached by the end of June.

The A400M’s top four customers have requested 162 of the aircraft, with Germany ordering 60, France 50; Spain 27 and Britain, 25.

But Britain, its finances severely strained by the financial crisis and a deep recession, has already tried in vain to cut its order for Eurofighter combat jets. If it backed off the A400M, that would raise the cost for the other countries and threaten the project’s viability...

Airbus looks likely to have to foot the bill for the A400M’s further development, which analysts peg at roughly $2 billion a year. Costs and order numbers are likely to be discussed this weekend at a meeting, called by the French defense minister, Hervé Morin, with fellow ministers from Germany, Spain, Britain, Turkey, Belgium and Luxembourg.

“I still believe this project is doomed,” said Howard Wheeldon, a senior strategist at the brokerage firm BGCPartners in London, and long a skeptic of the project on the grounds of cost, risk and its lack of export orders.

Doug McVitie, chief consultant of Arran Aerospace in Dinan, France, calculates the tipping point at roughly 120 of the key 162 orders before the project ceases to be feasible.

The need to protect some 10,000 direct and indirect jobs in Spain means Madrid, although stung by losing responsibility for the airlifter earlier this year, is likely to reaffirm its order, analysts say...

Mark
Ottawa
 
More here from Defence Management:

Calls for six month A400M extension
Friday, June 12, 2009

Germany and France have asked for six additional months to sort out the troubled A400M programme.

French President Nicholas Sarkozy said he and German Chancellor Angela Merkel had "decided that it would be good to give ourselves about six more months to continue discussions to find the best solution possible."

Merkel, who has suddenly become a staunch supporter of the programme in recent days despite ardent opposition from her own defence ministry, concurred, saying: "We are in complete agreement. We will give ourselves a few months and then we'll see."

Their comments come just weeks before the partnering nations must decide on whether or not to cancel the programme altogether. Under a ruling by Occar, the EU procurement agency, if all of the partnering nations agree to a cancellation, EADS will not be able to seek financial penalties and it will have to pay back up to €5.7bn in early payments made by the partnering nations.

Each country involved in the programme would have to agree to the moratorium. Britain's defence budget may not allow for an extended delay given the fact that ministers and the defence board are attempting to slash £2bn from next year's budget and crack down on trouble procurement programmes.

Yesterday the MoD reacted coolly to the comments by Germany and France, maintaining that the original deadline should be observed.

"A decision is expected to be reached before the end of the current moratorium on the future of the A400M programme," a spokesperson said.

The British government's recent comments show that it is prepared to walk away from the programme if the delays continue. A six month moratorium on the potential cancellation would bind Britain to the programme and keep it from finding other permanent replacement solutions such as more C-130s and C-17s.

Recent comments by defence ministers indicate that Britain more than anyone else, simply wants a resolution, rather than seeing the saga continue to drag out through the end of 2009.

The A400M has been beset by massive engine and design problems and is already scheduled to be delivered at least four years late.

The other partnering nations besides Britain, France and Germany, are Spain, Turkey, Belgium and Luxemburg.
 
the money line

"Airbus looks likely to have to foot the bill"

AIrbus doesn't foot any funding requirements  . . .  they will "foot" the bill by going cap in hand to the governments involved and play the "jobs, jobs, jobs" card.

Actually they will have two caps in hand because they are concurrently going to the Euro taxpayer well for something like $13 billion to do the A350 project.

The Americans now have Government Motors to rival the Euros Government Airframers.

That giant whoooooshing sound is good taxpayer's money going bye-bye

Government subsidies will not play out well in America.  Wanna bet it skewers the A330/MRRT/KC30 as a valid Tanker contender.




 
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