Paris to soften landing for Airbus subcontractors

14th November 2006, Comments 0 comments

PARIS, Nov 13, 2006 (AFP) - The French state is to provide financial aid to small and medium-sized sub-contractors retained by troubled aircraft manufacturer Airbus, Prime Minister Dominique de Villepin said in an interview to appear Tuesday.

PARIS, Nov 13, 2006 (AFP) - The French state is to provide financial aid to small and medium-sized sub-contractors retained by troubled aircraft manufacturer Airbus, Prime Minister Dominique de Villepin said in an interview to appear Tuesday.

He told the newspaper La Dépêche du Midi he would travel to Airbus headquarters in Toulouse, southern France, on Tuesday "with concrete proposals to help sub-contractors," notably with "reimbursable advances of around 80 million euros (102 million dollars) for 2007 and 2008."

At Airbus, struggling to overcome serious production setbacks with its A380 superjumbo program, delays in payments to sub-contractors can amount to as much as 120 days. The manufacturer was recently reported to have asked sub-contractors to accept an additional delay of 30 days.

The delays cause financial headaches for subcontractors who in many cases must pay their suppliers in 30-40 days.

The A380 program, which is critical to Airbus efforts to catch up with US rival Boeing, is now running two years behind schedule. Airbus has also been forced to redesign the A350 mid-size jet, which will push back initial deliveries for that project as well.

Villepin told the newspaper that the French government, which has a 15 percent stake in Airbus parent EADS, would ensure that Airbus has a long-term strategy to protect jobs in the Toulouse region.

"Employment is the government's absolute priority," he said. "Airbus, its sub-contractors, but also the whole region of Toulouse must know where we are going," he added.

Villepin also said he would "strongly defend" a plan for building the A350 on the Toulouse production lines currently used for the A330 and A340 models. "It seems natural to me that this line should be used for the A350."

Copyright: AFP

Subject: French news

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