The Defiance
TOULOUSE (Own report) Today, Tuesday, the mammoth airliner, A 380, developed by EADS was unveiled to the public, with the German Chancellor in attendance. The new super-jumbo is considered the final proof of the technological lead in the area of civilian production of this German/French corporation over its US rival, Boeing. The weapons department of EADS is still lagging behind, in spite of a few major contracts. It has been expanded with determination, under the direction of the German reserve officer, Thomas Enders, in the last few years. The entire EADS enterprise, in which Enders is to become one of the 2 Chief Executive Officers (CEOs), wants to establish the site in Berlin as the holding company for the German and French arms industries. In so doing, EADS would become the nucleus of the future arms industry complex of the European Union. This centralization would be advantageous in the rivalry with the US arms industry.
Also in attendance at the ceremony of the unveiling of the A 380 super-jumbo jetliner, alongside Chancellor Schroeder, were the heads of the governments of the other participating states involved in the Airbus-consortium, France, Great Britain, and Spain. The A 380, the largest passenger plane ever constructed, will insure the EADS filial, Airbus, the position of being the indisputable world leader. Airbus has already surpassed its US rival, Boeing, on the civil aviation market. A first major contract with China, for approx. 2.3 billion Euro is ready to be signed. As a reaction, Boeing has announced a modernized version of its 747 Jumbo jets, which it hopes will prohibit, its European competition from taking away its monopoly on jumbo jetliners. The fierce rivalry of the two airliner constructors is continued at the political level. Because of alleged competitive distortions through state subventions, the opponents were threatening each other with lawsuits. Only with great effort, could a suit before the World Trade Organization be, for the time being, avoided. The legal dispute threatens to extend to other branches. Airbus and Boeing have, at present, 3 months to reach an agreement. In spite of the subvention controversy, Airbus is entering the next round and is demanding more of the state subventions (starting up aid), that is so criticized by Boeing. They are demanding 1 billion Euro.
Ceasefire
The transatlantic competition is being accompanied by strife between the European partners. Berlin and Paris each wants to insure the own national influence, through their national representatives in the EADS' leadership. This leads to mutual attempts at cheating. The German side suspects Paris of wanting to replace the French/German EADS co-chairmanship with a French president. The planned absorption by EADS of the French arms producer, Thales, nourished Berlin's fear of domination. Thales could tip the scales of the EADS components in favor of the French, is how it is expressed in German business circles. The personnel conflict was reconciled through a formal compromise, whose general acceptability was considered limited; Airbus President and Chief Executive Officer Noël Forgeard and the current head of EADS's armaments division Thomas Enders are to function as equal Chief Executive Officers (CEO). The question of the balanced weight of the national EADS component enterprises, that could be dislocated with the takeover of Thales, remains open.
More Armament
With the nomination of the German reserve officer Enders, to the new CEO post, the armaments division of EADS takes on even more preponderance. Enders can point to the fact that he developed the armaments division into a profitable sector. In the past year the proportion of the armament sector profit was further enhanced in relation to the civilian sector. Analysts judge that, the 50 billion Euro in outstanding orders for armaments, for the concern is ,,extremely high." 1)In the last few weeks, EADS was able to conclude two contracts worth billions of Euros for the delivery of air tankers to two US allies, Australia and Great Britain. 2)What's more, EADS hopes to win the 23 million US-Dollar contract for air tankers for the US Airforce. The deal would have to be concluded in cooperation with Boeing, its rival. The South African Defense Ministry has announced its interest in the Airbus military transport plane ,,A-440M"and promised the investment of at least 750 million Euro. The French government, after all, has ordered ballistic missiles worth 3 billion Euro from EADS, to furnish its atomic submarines.
European Holding Company
The consolidation of the European armaments complex, of which EADS represents the hub, speeds Berlin's plans for autonomy in the military sector. 3)In order to be more independent of the USA, the German government officially announced in 2004, for the first time, that it intends to develop EADS into the mother company of the German and French arms industry. According to these plans, EADS will not only be the umbrella under which the French arms industry, Thales carries out its business, but also will integrate the German merged military and shipbuilding industry. EADS has already made known its interest in an eventual partnership with the German warship construction industry, currently under the leadership of Tyssen-Krupp. In the military industry, through the withdrawal of the Roechling family from Rheinmetall, the door to a merger was opened. EADS is seen as a possible buyer.
Catch-Up
With this restructuring not only the German weight in EADS will be substantially greater. The German-French firm would assure a key role in the ,,new-ordering"of the European arms industry. 4)At the same time Berlin and Paris can, at long last, also in the arms industry sector be able defy their mighty US rival, explained the state's secretary in the German Ministry of Economy, Ditmar Staffelt (SPD): ,,Our objective is an European arms company, that can, not only in the airliner, but also in the military sector, actively keep step with the USA." 5)
1) EADS ruestet auf; Financial Times Deutschland 13.01.2005
2) see also Sentiments of Spring
3) see also Independent Armament for ,,necessary power base", Criminaland Buy European First
4) see also The End of ,,Civilian Power"
5) EADS soll Europas Waffenschmiede werden; Spiegel online 09.12.2004
Sources:
Rheinmetall: Heftiges Werben; Manager Magazin 29.11.2004
EADS koedert Boeing mit Kooperations-Angebot; Financial Times Deutschland 06.12.2004
EADS draengt auf den auf den US-Ruestungsmarkt; Die Welt 07.12.2004
Berlin and Paris in dogfight over control of EADS; The Times 07.12.2004
Berlin sieht EADS in entscheidender Rolle; Handelsblatt 07.12.2004
EADS legt Fuehrungsstreit mit Nominierung Forgeards bei; Dow Jones Newswires 17.12.2004
EADS: Australien unterzeichnet Kaufvertrag ueber 5 Tankflugzeuge; Dow Jones Newswires 20.12.2004
,,Thales wird fuer die EADS im Jahr 2005 auf der Tagesordnung stehen"; Frankfurter Allgemeine Zeitung 20.12.2004
Frankreich bestellt bei EADS Atomraketen fuer 3 Milliarden Euro; www.finanzen.sueddeutsche.de 23.12.2004
Boeing bekaempft Airbus. Subventionsstreit ist laengst nicht beigelegt; Handelsblatt 14.01.2005
Wallfahrt zum Superjumbo, Frankfurter Allgemeine Zeitung; 15.01.2005
EADS-Konsortium sichert sich Tankflugzeug-Auftrag; Handelsblatt 16.01.2005
Enthuellung des Flagschiffs - der ,,A380 Reveal"; www.eads.com 17.01.2005
Airbus verhandelt ueber Superjumbos A380 fuer China; Berliner Morgenpost 17.01.2005
Boeing will mit vergroessertem Jumbo kontern; Handelsblatt 17.01.2005
