Dumping the Ballast Airbus Moves Ahead on Factory Sales
European jet maker Airbus announced on Wednesday that it had settled on preferred bidders for the six European factories up for sale. A highly touted US bidder was left with nothing.
Airbus has settled on preferred bidders for its six European factories up for sale.
The final details have yet to be worked out in the deals and negotiations are ongoing. But EADS said on Wednesday that it expects to complete the sales next summer. "The ongoing divestment of sites and the building of a network of partners for Airbus allows EADS to focus its resources on core activities," said EADS Chief Executive Louis Gallois in a statement.
Three Airbus factories in Germany, Varel and Nordenham in the state of Lower Saxony along with Augsburg -- part of EADS Defence & Security -- are to be taken over by the German company MT Aerospace, a subsidiary of OHB Technology. In France, Latecoere is being given preference for the Airbus sites in Meault and Saint-Nazaire. EADS and Airbus are planning to retain significant minority stakes in the factories as part of joint venture arrangements. The company said such a structure would help Airbus keep close tabs on the transition as it continues developing the A350 XWB, a long range passenger jet meant to compete with Boeing's 787 Dreamliner.
The sixth factory, Britain's Filton site, is to be sold outright to the British company GKN. The six Airbus plants represented some 1.4 billion of the company's cost base in 2007 and employ 7,400 people.
Airbus announced the Power8 restructuring program in February to cut costs in the face of massive losses incurred by the delayed rolling out of the super-jumbo A380. Delays in the military version of that plane, the A400M, have likewise cost the company dearly this year. The weak dollar, though, has been perhaps the most significant drag on the company's balance sheet -- EADS recorded losses of more than 700 million in just the first nine months of 2007.
Early speculation had centered on Spirit Aerosystems being well placed to take over all six of the factories. Politicians in both Germany and France, however, were concerned about selling to an overseas buyer. Many have speculated that national governments put pressure on EADS to choose European bidders, but EADS denied that such pressure was exerted.
"Politicians played no role in the decision," an Airbus spokesman said on Wednesday.