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  SPIEGEL Interview with Airbus CEO Thomas Enders: 'The Game Is Just Beginning'

SPIEGEL Interview with Airbus CEO Thomas Enders 'The Game Is Just Beginning'

Part 2: 'A Jolt Is Going Through the Company'

SPIEGEL: How do you plan to prevent management mistakes such as those that happened with the A380 and the A350 in the future?

Enders: The key is integration and transparency, both internally and externally. Airbus is now being fully integrated, finally. We are still dealing with the repercussions of a certain bunker mentality and the old bad habit of concealing bad news. Our new "Power 8" program is designed to tightly integrate development and production -- and to do so from the very beginning. To keep costs down with the new A350 XWB, everyone involved in the project, including buyers and suppliers, is already sitting at the same table in the early design stage. Besides, we have new, tighter management as of Oct. 1. Believe me, a jolt is going through the company.

SPIEGEL: Nevertheless, Boeing is held up to you as a shining example, because the 787 is made primarily of state-of-the-art carbon fiber composites.

Enders: If you are referring to certain comments, all I can say is this: Things have changed! In fact, our new concept is quite convincing, as customer reactions demonstrate: Five years before the first planned delivery, we already have more than 270 orders on the books and expect to receive additional orders in the coming months.

SPIEGEL: But Boeing has sold almost three times as many of its new jets.

Enders: Our market forecasts and those of Boeing are based on the assumption that more than 5,000 of this type of aircraft will be sold in the next 20 years. In other words, the game is just beginning.

SPIEGEL: But Boeing seems to be playing with a better hand. Many of your plants lack the know-how to produce the new plastic fuselages in sufficient quantities and at the necessary level of quality.

Enders: Nonsense! Our plants in Stade, Nantes and Illescas in Spain have long been in command of this technology and are not in any way inferior to Boeing in this regard. But we cannot come up with the needed investment money to convert all Airbus operations to carbon fiber production. That's why we plan to sell some of our plants to new owners.

SPIEGEL: That decision was reached more than a year ago. Why is it taking so long to implement?

Enders: We want to make three complex decisions at the same time: sell plants, secure our long-term investments there and agree to an arrangement to participate in the production of the A350 XWB. The decision is also critically important to the future of Airbus. That's why we are not allowing the new deadlines constantly being thrust upon us to prevent us from selecting the right partner. We will decide when we're ready.

SPIEGEL: Voith, an engineer manufacturer that was apparently the German government's first choice, just withdrew its offer. Why?

Enders: That was Voith's decision, which I respect. But we still have two offers for each site -- so there is still some competition.

SPIEGEL: Is there growing political pressure to award the contract to the last remaining domestic contender?

Enders: Of course, when you are dealing with national politicians there are preferences for national solutions. This is no different in Germany than in France or Great Britain. But you won't be seeing a feel-good or cozy compromise designed to satisfy political interests, which could leave us with some big problems in the medium term.

SPIEGEL: Selling a few plants to new owners won't help you much against the rampant decline in the dollar's value against the euro, as long as you're producing mainly in Europe.

Enders: Suppliers can certainly use these plants more efficiently to find new customers in other markets and expand the product portfolio. Of course, the new owners -- just like us -- will also be forced to shift a portion of their value-added production to locations outside Europe.

SPIEGEL: With a detrimental effect on German jobs?

Enders: With a positive effect on Airbus's competitiveness. From the standpoint of politics, our world has been ideal up to now, because 95 percent of our employees are based in Europe. But we earn most of our revenues outside Europe. This means that we will have to shift a portion of our business in the future to other countries where there is a growing aviation industry.

SPIEGEL: You also need the support of the political world to turn Airbus into a perfectly normal business. But it continues to keep a jealous watch to ensure that no single location in a country is favored or put at a disadvantage.

Enders: Of course there are always national perquisites. But our analyses of the cable problems in the A380 have shown that they were merely a symptom of the real, underlying cause: the lack of integration and dovetailing of processes within the company. This is our big issue, the one where we need to see some change.

SPIEGEL: But that doesn't change the fact that political criteria will ultimately determine the outcome of decisions on manufacturing sites.

Enders: I'm taking a wait-and-see approach. For example, if the Germans can't keep up with their orders, the French, British or the Spanish will have to finish the job. Of course, the opposite is also true. In the end we're all in the same boat, and customers don't care where we manufacture what. All they care about is when we can deliver. We need flexibility beyond national borders.

SPIEGEL: Representatives of the German and French governments take a different view. The French state owns 15 percent of Airbus parent company EADS. The federal government in Germany, as well as states like Lower Saxony and Hamburg, have also recently acquired smaller shares of the group.

Enders: I'm not too concerned about that. But perhaps one day the head of Airbus will be asking them: What is more important to you -- that Airbus is a healthy, successful company and can keep up with Boeing? Or do you prefer to focus on your national and regional interests? I believe there is only response to this question.

SPIEGEL: Only a few months ago, you were supposed to get the top job at parent company EADS, not the one at Airbus. What happened?

Enders: Well, life is full of surprises. But, in all seriousness, I discovered that I like this job better. Where is the future of the EADS Group being decided? At Airbus, which is still responsible for two-thirds of the group's revenues. I didn't want to be standing on the sidelines.

SPIEGEL: Doesn't it bother you that your former colleague, Gallois, has to approve all of your important decisions?

Enders: I don't have a problem with that. Louis Gallois is a very experienced manager. We have an excellent relationship.

SPIEGEL: The Airbus employees in Toulouse had significant reservations about you. Many perceive your enthusiasm for America and your tendency to come across as militaristic and abrupt as a culture shock.

Enders: All I can say is that my reception at Airbus and in Toulouse was extremely warm and genuine.

SPIEGEL: What distinguishes you from your predecessors?

Enders: You'd have to ask the Airbus employees. But I do know that the people at Airbus want to see a man at the top and a management team without their heads in the clouds. They prefer someone who is familiar with the reality of those who work in the plants, sometimes around the clock. They expect their boss to talk to them instead of just feeding them presentation slides in five different colors. I like that.

SPIEGEL: And do you confront the employees with uncomfortable truths, if need be?

Enders: I happen to be someone who doesn't beat about the bush. I like to get to the point. You will not see me changing my style now and tiptoeing around. The important issue is that people realize that I am a hands-on manager -- not someone who's interested in politics, but someone who has the company's interests at heart. Can you imagine a better job in European industry than running Airbus?

SPIEGEL: Sure: The head of Siemens, for example.

Enders: That job is taken, as far as I know. At Airbus, I have the great opportunity to help a great company survive in the future, as well as to bring about fundamental changes.

SPIEGEL: Mr. Enders, thank you for this interview.

Interview conducted by Dinah Deckstein and Armin Mahler at Airbus headquarters in Toulouse, France.