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  SPIEGEL Interview with Airbus CEO Thomas Enders: 'EADS Should Never Have Signed the A400M Contract'

SPIEGEL Interview with Airbus CEO Thomas Enders 'EADS Should Never Have Signed the A400M Contract'

Part 2: 'We've Made Big Mistakes'

SPIEGEL: Your biggest worry is currently the planned A400M military transport aircraft, which has been in the news for months. Which countries could cancel as buyers in the future?

Enders: Up until now, none have canceled. The A400M customers are currently examining the program, though. We'll see how it goes when this process is completed.

SPIEGEL: Germany is threatening to completely withdraw and France is considering reducing its order. It doesn't exactly look like a promising future ...

Enders: Objection! If we can manage to get the program back on course now, the A400M will be a success story. That is what we want -- but not at any price. In any case, we cannot build the plane under the conditions that we've had up to date.

SPIEGEL: Your company is also partly to blame for this development.

Enders: True. EADS should never have signed this contract. Our American competitors would never have accepted such conditions. We've made big mistakes, and errors have also been made on the customer side. We should now rectify these together.

SPIEGEL: What are your demands on the governments? More money? More time?

Enders: We submitted a few proposals back in December. This basically concerns three issues. First, the A400M should be technically and economically organized like any other defense project, where the risks and opportunities are appropriately shared by the customer and the industry. This means, for example, that Airbus will no longer carry the risks alone of engineering the engine, because that is neither our job nor did we want things this way. In all other military programs, the engines are also handled separately.

SPIEGEL: And second?

Enders: Engineering, flight tests and the start of production have to be optimized chronologically in order to minimize the risks of series production. And third, studies need to be conducted to assess whether the A400M, which is designed to be more or less an all-rounder, really has to be able to do everything right from the start. It could save everyone a great deal of time if some of the things this multi-talented aircraft is supposed to be able to do were only introduced step by step.

DER SPIEGEL

Graphic: Airbus orders and EADS turnover

Enders: I assume that we'll find a solution with the governments. If not, then it would be a case of "better to make a painful break than to draw out the pain," as the Germans say. In any case, I'm not going to traipse off to Berlin or Paris to ask for a continuation of the program under conditions that are unacceptable for us. As the head of Airbus, I have to look at the whole picture. On the one hand, our business is threatened by the global economic crisis. On the other hand, I have capital-intensive programs and new developments like the A380 and the long-haul A350 plane. This means that we will face enormous financial and industrial challenges over the coming years, even without the A400M.

SPIEGEL: The tanker that you want to sell to the US government is something that you're not even mentioning any more.

Enders: Thank you for reminding me of that. The US tanker fleet is obsolete and needs to be replaced. We had the contract, but we lost it for political reasons. Our competitor is fighting with the gloves off. That was to be expected. But we'll be back for another round.

SPIEGEL: Nobody knows better than you that, in your business, political sensibilities often carry more weight than economic effectiveness. In view of the economic situation, it can hardly be expected that Washington would again ignore its own giant aircraft manufacturer Boeing and award a multi-billion-dollar contract to Europe.

Enders: We have the better product, outstanding partners and we want to build the planes in the US. Why shouldn't we be able to win?

SPIEGEL: To make matters worse, the World Trade Organization (WTO) now also has to mediate the dispute between the US and Europe over launch aid that Airbus also receives …

Enders: ... and we, in contrast to Boeing, completely pay back. But this is a rather bizarre discussion that seems to come from another world and another time, when you consider the multi-billion-dollar programs that governments around the world have launched to bail out their banks and industries. And now repayable loans for Airbus supposedly distort international competition? That's ridiculous!

SPIEGEL: Rivalries and power struggles between the Germans and the French have also erupted time and again within your company.

Enders: That's your opinion.

SPIEGEL: You yourself have vehemently demanded an "end to the hate campaigns."

Enders: Things have improved considerably since certain animosities flared up once again last year, when there were warnings here in Toulouse against German domination. The younger generation of Airbus managers experiences integration from a totally different perspective. But I certainly wouldn't claim that the task of integration has already been completed.

SPIEGEL: As soon as something goes wrong at a plant somewhere, nationalist tensions flare up again.

Enders: Problems within the company can be a trigger. But this is usually brought into the firm from the outside. It's like extinct volcanoes. They can also erupt again someday. But as I said, integration is making good progress.

SPIEGEL: What is now the most French thing about you?

Enders: Perhaps my preference for French wine from the Toulouse region? But seriously, my job is not to be as French or German as possible, but to manage an international company -- a company, I might add, that will become significantly more Asian, and hopefully also American, over the next decade.

SPIEGEL: Your firm provides the parent company with roughly 60 percent of its sales volume. Isn't it about time to finally consolidate all the EADS headquarters -- in Ottobrunn near Munich, in Amsterdam and in Paris -- here in Toulouse and call the entire company Airbus?

Enders: Not a bad idea! Toulouse is also our largest location. But that's a decision for EADS.

SPIEGEL: Your father was a shepherd. Do you sometimes imagine how wonderful life would be if you were responsible for nothing more than a flock of sheep?

Enders: No. People often idealize the life of a shepherd, but it's very hard work. As children we had to lend a big hand around the farm, and vacations were rare. I also didn't have a talent for looking after sheep. But those were highly formative years that, in retrospect, I wouldn't have missed for the world.

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

Translated from the German by Paul Cohen

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