Aircraft

Prime Minister Dominique de Villepin has announced a two-year, €80 million ($100 million) lifeline for France's aerospace businesses and has warned Airbus that it must speed up payments to contractors.

Speaking at the fifth Financing for Innovation and Competitiveness Forum in Toulouse, De Villepin pledged to ease any knock-on effect of Airbus's current difficulties on its small and medium-sized (SME) suppliers, and said €40 million would be set aside in both 2007 and 2008 for repayable loans to French aerospace SMEs.

"This is in response to their very real concerns about cashflow," said de Villepin. "French industry needs the hundreds of SMEs that feed it. Industry survives through their commitment and dynamism. That is where job creation happens. That is where innovation is advanced and is where our future lies."

The French leader said he wanted Airbus to "propose establishing a charter of confidence with all its subcontractors, and this charter should address, in particular, the question of late payment".

He added: "It is a crucial cashflow issue for those businesses that are the most fragile. In other European countries, payment by large businesses is a lot better and eases the supplier's life. I want us to examine the whole issue, including legislative solutions to set maximum payment limits."

De Villepin said he had charged transport minister Dominique Perben with setting up working groups to assess the state of the French aerospace supply chain and finding "appropriate solutions".

He said a further €50 million would be made available to support aeronautics, embedded systems and composite materials centres of research excellence, and €10 million to develop an aerospace campus.