Germany expects “sensible solution” to A400M dispute


German economy minister Rainer Bruederle says he expects a “sensible solution” to ultimately emerge from a dispute surrounding the funding for planemaker Airbus’ delayed A400M transport aircraft.
“In the end there will probably be a sensible solution,” Bruederle told Deutschlandfunk radio.

His comments come as French defence minister Herve Morin yesterday again expressed confidence in the programme and Turkey pressed for its continuation, Reuters reports. Germany has 60 of the transports on order, France 50, Spain 27, Britain 25, Turkey 10, Belgium seven and Luxembourg one.
“I’m confident because this is about the interests of European industry,” Morin said in an interview on BFM television.

In Turkey defence minister Vecdi Gonul said that country does not want to see a cancellation of the project.

Gonul also told a news conference that any decrease in the number of plane purchases would be wrong.

Airbus Military parent EADS has asked countries buying the transporter to come up with funds for increased production costs, but key buyer Germany has so far ruled out making concessions on volume or price.

German media have reported Airbus has drawn up contingency plans to scrap Europe’s largest defence project, worth 20 billion euros, after months of inconclusive talks with seven European NATO buyers.

Morin adds there is about five billion euros in surplus costs linked to the development of the programme.
“What we’re saying to Airbus is that this charge should be shared. I understand very well that the president of Airbus, as part of a logical discussion, should be saying ‘we’re ready to stop’ because it’s a way of putting pressure on the governments.”

Bruederle also said he believed the company should have to shoulder “a large part” of the additional costs.

Business daily Handelsblatt on Wednesday quoted an unnamed Defence Ministry official as saying Germany would not yield to demands from Airbus to increase its funding for the A400M.

The official told the paper Germany would not contribute more than a further 650 million euros set out in its contract to cover inflation and surcharges.

A source close to the planemaker said on Tuesday its chief executive was growing impatient over the failure so far to agree a budget deal for the military project.

Scrapping the deal could trigger repayments of more than five billion euros in government advances to nations that first commissioned the troop and heavy equipment carrier — Germany, France, Britain, Spain, Belgium, Luxembourg and Turkey. SA in November cancelled its order for eight of the transports.

Negotiators say EADS has asked NATO buyers to contribute 5.3 billion euros of extra funds for producing the A400M and offered to bear a similar increase in development risks, of which 2.4 billion euros has already been provisioned.