AEROSPATIALE IS holding "high-level discussions" with the French Government on a new proposal to fund France's share of the Future Large Aircraft (FLA) military transport.

The latest twist in the French industry's efforts to salvage the project, after funding was cut by the French Government in February, amounts to a novel solution for financing a major military-aircraft programme. The manufacturer is presenting a plan under which the Government would act as guarantor on bank loans to pay for France's FLA requirement, now amounting to 52 aircraft out of the 250-300 total to be produced.

The move would revive France's commitment to the project, which has been at a low key since Government funding was withdrawn in the 1996 defence budget.

Each of the FLA participatory nations (France, Germany, Italy, Spain and the UK, with Belgium and Portugal as associate partners) is expected to find its own financing for the FLA.

Major doubts remain over Germany's stake, but it is hoped that these will be resolved at the Franco-German summit meeting scheduled for December, possibly using the French funding scheme as an example.

The UK, according to Aerospatiale director of military business Philippe Picq, continues to be "solidly behind" the military-transport programme, however.

Aerospatiale says that it has already lined up "several" banks interested in providing the long-term financing required.

"We're very optimistic," says Aerospatiale's FLA programme chief, Pierre Froment, who explains that it means that the cash-strapped Government would no longer have to find the upfront money for the programme, instead taking responsibility only for repaying the interest on the loans.

Froment says that the series price of the FLA, expected to be around $75 million per aircraft, "-will include development, production and financial costs".

Source: Flight International