A new Airbus A380. - REUTERS
PARIS (AP):
THE NEW management of Airbus got down to business Monday after a weekend shake-up at parent company EADS that forced out two top executives - but the headaches do not end there for the European plane maker.
With Airbus already losing ground to its U.S. rival, the new team has just days to take decisive action if they are to avoid a further loss of credibility for the company, analysts say.
Louis Gallois, who replaced Noel Forgeard as France's top executive at EADS, issued a joint statement with his German co-CEO Tom Enders, who survived the reshuffle, pledging to make a "recovery" at Airbus the top priority.
"We'll work hard and we'll work jointly to bring EADS back on course," the statement said.
The crisis at the defence group followed its announcement last month that the 555-seater A380 superjumbo was likely to suffer new delays of up to seven months.
The revelation caused EADS shares to plunge 26 per cent on June 14, and France's Financial Markets Authority said it was investigating Forgeard and five other directors who sold EADS stock just weeks before the company ordered an internal assessment of the production problems.
But concern had already been mounting among Airbus share-holders and employees after top officials recognised that they had underestimated the threat from rival Boeing Co. in the middle of the market.
Airbus has received only 100 orders for its planned A350 jet, billed as a mid-sized, long-range, fuel-efficient rival to the Boeing 787 Dreamliner - which has 350 orders. Toulouse, France-based Airbus is widely expected to announce a more ambitious redesign at Britain's Farnborough Air Show, which opens in two weeks.
WORKING IT OUT
"It's clear that's what the market wants," said an official close to the plane maker, who asked not to be identified because the plans for the program are confidential. An EADS spokesman declined to comment.
Christian Streiff, named Sunday to replace ousted Airbus CEO Gustav Humbert, would be signing up to a decision he had little or no role in preparing, industry observers point out - but one which could be make-or-break for Airbus' attempts to remain a serious rival to Boeing.
Streiff, a former executive with building materials company Saint Gobain, could find it difficult to take the lead on such a major decision in his first two weeks "given that he doesn't know the aircraft market personally," said Agnes Blazy, an analyst with CM-CIC Securities in Paris. "A collegiate decision will therefore have to be taken."
Streiff's appointment coincides with moves by EADS to impose tighter supervision on Airbus, as it acquires Britain's BAE System's 20 per cent of the jet maker.
But the shake-up stopped short of making changes to the split Franco-German structure at EADS, which divides board and management posts scrupulously between the French shareholders - the government and Lagardere SCA - and Germany's DaimlerChrysler AG.
"This is not the way normal companies are run," said Richard Aboulafia, an aerospace analyst with U.S. consultancy Teal Group. "But this is the best they could do given the time they had."
