EADS secures Airbus rescue

EUROPEAN nations agreed yesterday to pump in €3.5bn (£3.1bn) to save the delayed Airbus A400M airlifter, but left key details unresolved after more last-minute haggling over loans and jobs.

Technical problems have pushed the troop plane four years behind schedule and €11.2bn over budget, threatening 10,000 jobs. After savings and writedowns, Airbus parent EADS still faces a hole of €5.2bn.

The A400M is due to provide airlift capacity to Britain, Belgium, Luxembourg, France, Germany, Spain and Turkey.

Confirmation of the overall size of the rescue package came after EADS accepted a 10 per cent increase in the price of the plane worth a total of €2bn towards cost overruns.

“The company is no longer making further financial demands,” French defence minister Herve Morin said after talks between buyers on the sidelines of European Union defence talks.

Some countries plan to defer deliveries of aircraft as a way of raising the unit price, rather than stumping up new cash.

The plan also includes €1.5bn of top-up support, billed by officials as guarantees to be repaid from exports.

An upbeat but inconclusive statement released after the seven-nation talks papered over tensions over the cost to each nation. “Defence ministers consider that significant progress has been achieved during the negotiations,” the statement said.

The proposed deal leaves EADS with A400M losses of €1.7bn on top of €2.4bn written off. But it could be forced to make a provision for €3.2bn if it has to accept the top-up as a loan rather than an advance on future sales.