BERLIN – European aviation and aerospace firms expect a recovery this year after two years of crisis in the industry, the head of the German Aerospace Industries Association BDLI said Monday.

“I expect in the course of this year and certainly next year a recovery for the European aerospace industry,” BDLI president Rainer Hertrich said on the opening day of the 2004 Berlin Air Show.

Hertrich cited the Galileo satellite navigation system, the start of the A400M European military transporter programme and the Airbus A380 passenger plane as projects leading the recovery.

In a further boost, EADS, the European aerospace and defence group, sealed a contract worth EUR three billion to build 30 Ariane-5 satellite-launching rockets.

The contract was signed in the presence of German Chancellor Gerhard Schroeder who opened the air show at Berlin-Schoenefeld airport.

Last week EADS said that, after registering losses of some EUR 400 million in 2003, its aerospace division is expected to break even this year and become profitable again in 2005.

Schroeder underlined the importance of the industry to Germany, saying the government backed measures to increase the country’s role in aviation and aerospace technologies.

The European aerospace industry was now on a par with the United States but it was important “to point out the quality and value of our products”, he said.

It was the German government’s aim to increase the share of spending on technological research from 2.5 percent to 3 percent of gross domestic product.

Schroeder said military products would have greater significance in the future, citing the A400M transporter and the multi-role NH90 helicopter which is to be presented at the exhibition on Tuesday.

Despite the industry’s upbeat prospects, Germany’s leading aircraft engine maker, MTU Aero Engines, announced it would be slashing 1,000 of its 8,000 workforce by the end of 2006.

Chairman Klaus Steffens said high fuel prices, unfavourable dollar exchange rates as well as a drop in orders and industry price-cutting had contributed to the decision.

However, the company hopes to increase turnover by EUR 100 million this year and to have recovered from the crisis by 2006.

In the industry’s hopes for a turnaround this year, European aerospace officials have been boosted by orders for the 555-passenger Airbus A380 twin-deck plane which will enter service in 2006.

Hertrich said orders have already come for 129 of the huge planes, already more than half needed for break-even on the project.

German aerospace officials say that despite the success of Airbus, the Airbus consortium was taking seriously the challenge presented by U.S. rival Boeing’s planned 7E7 Dreamliner.

The aircraft, which is expected to enter service in 2008, will have most of its primary structure, including the fuselage and wing, made of composite materials.

The Dreamliner will succeed the Boeing 757 and enter competition with 250-seat aircraft such as the Airbus A300-600 and Airbus A310. Boeing says the plane will be more fuel efficient than comparable models and bring big-jet ranges to a mid-size plane.

Ditmar Staffelt, the German government aerospace industry coordinator, said the Dreamliner will present a further challenge to the European aviation industry to focus on technological developments such as the use of composite materials.

“We think we can come up with the right answer, technologically as well,” he said after a traditional meeting of government ministers from the Airbus partner nations, Germany, France, Britain and Spain.

The expansions of the European Union and North Atlantic Treaty Organisation are to be the dominant topics of this year’s show, which runs until Sunday and features some 1,000 exhibitors from 43 countries.

DPA

Subject: German news