Gilbert Sedbon/PARIS,

SERGE DASSAULT, speaking as president of French aerospace-industry association Gifas, warns of another bleak year for the country's embattled industry and renews calls for reform of the French military-procurement system.

Presenting the association's year-end report, Dassault warns that 1995 is likely to bring a further fall in sales and employment as the industry continues to battle with shrinking order books and an undervalued US dollar.

Around 5,100 jobs were shed in 1994, bringing the industry's workforce to a little above 100,000. That marks a fall of some 17% since the peak five years ago.

Dassault says that more jobs will go because of the continued squeeze on military budgets, and sluggish civil markets. Hardest hit are the equipment manufacturers, which have seen a 26% fall in employment over the past five years, compared with an 11% fall by the airframe prime contractors.

Industry sales dipped by nearly 3.5%, to Fr105.7 billion ($20 billion) over the year on a non-consolidated basis, some 13% down on the 1991 peak. The total is expected to edge down, by another 2% in 1995, warns Gifas.

Dassault holds out a slight prospect of recovery in 1996 as work feeds through from the orders received back in 1992, including his own company's contracts for 60 Mirage 200-5s for Taiwan and another 12 for Qatar.

The upturn is likely to be little more than a brief respite given the weak performance on orders, over the past two years, cautions Dassault. Intake of new orders picked up a little in 1994 from the depressed levels of the year before, but the recovery was not enough to maintain the industry's backlog, which shrank by around 2.6% to Fr229 billion.

To help companies weather the downturn, Dassault calls for urgent reform, of the French military-procurement system. He is pressing the French Government to guarantee a steady stream of work, rather than "piecemeal" orders "drip fed" in each year's defence budget.

"When the state knows that it is going to order 325 [Rafale] combat aircraft, it is not risking much by ordering them in batches of 30 or 50, even if the financing is done on a yearly basis," he says, arguing that this would allow manufacturers to lower unit costs.

Dassault also complains over the levels of state funding for research in civil and military sectors. He voices particular concerns over the latest Government spending freeze, which has put a stop on Fr2 billion of defence-research funds due over the next five years. The comments come as France prepares for presidential elections in April.

Source: Flight International