Airbus to announce additional cost cutting measures

Deals

Airbus, a subsidiary of the European Space and Defense Co. (EADS), is planning to announce “additional cost cutting measures within the framework of the Power 8 program” before this summer, the group’s CEO Louis Gallois has said.

Gallois, who was speaking Friday afternoon during an interview with the La Depeche newspaper, took time to reaffirm his desire to ensure that “the essential activities of Airbus remain in Europe and particularly around the Toulouse region.” Defending the yet to be announced “additional measures,” the EADS CEO said that “their effect would be felt in 2011 and 2012,” and at the same time refuted rumors that tensions were hitting up between the company’s management and labor unions. “As regards employment, there is no tension either among us (Airbus) or among the employees of our subcontractors because of the increased workload,” said Gallois. During the interview, the CEO also reiterated his view that the aerospace group needed to “take account of the dollar” in its operations in order to “protect the heart” of its activities in Europe.

In addition, the EADS chief executive said that the company was working “to reinvigorate the aeronautics industry” by “contributing €30 million (about $48 million) towards the establishment of a €100 million investment fund with other partners.” Commenting on the breakdown of relations between Airbus and the air craft manufacturer Latecoere over the sale of several industrial sites, Gallois was quick to say that the company was looking out for “long-term investors.” “If they are financially viable, we will ensure that these sites continue to be managed as much industrially as it would have been the case with Latecoere,” he said.

Regarding the implementation of the Power8 restructuring plan that provides for 10,000 job cuts between 2007 and 2010, the CEO said that progress was much faster in France, Britain and Spain, but lagged behind in Germany owing to what he termed “cumbersome legal procedures for the approval of social plans.” In addition to prescribing job cuts both within Airbus and its subcontractors, the Power8 plan, which was announced on Feb. 28, last year, provides for the sale or transfer of certain industrial sites in France, Germany and Great Britain.

Meanwhile, EADS, whose senior employees are being investigated by France’s Financial Markets Authority (AMF) for possible insider trading, will this summer create an office to be charged with ensuring compliance with regulations within the company. “A system will be established, with the appointment of a chief compliance officer who will have direct access to the Board of Directors,” said a spokesman, confirming information published by a section of the European media. Seventeen members of the executive committees of EADS and its subsidiary Airbus, as well as the main two EADS private shareholders Lagardere and Daimler, are suspected of insider trading, according to an AMF report. (people.com.cn)

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