Gilbert Sedbon/PARIS

EUROCOPTER IS launching a fresh drive to improve productivity and cut costs as the Franco-German helicopter group prepares for the effects of pending French defence cuts and the continuing weak dollar. French engine manufacturer Snecma has already declared plans to accelerate rationalisation in the face of the threats.

Eurocopter president Jean-Francois Bigay says that the group aims to cut costs by Fr800 million ($160 million) during 1996. Some 800 jobs will be cut at Eurocopter France, with a further 350 jobs to be cut from Eurocopter Deutschland as part of what Bigay calls the "inevitable downsizing" of the helicopter group.

He adds that the move follows a "very difficult" year in 1995, although Eurocopter managers saw turnover edge up slightly to Fr9.3 billion over the year, with the delivery of 114 helicopters. Orders held up at Fr7.2 billion, with sales of 111 new and 53 used aircraft.

The group estimates that it won 40% of the total world market for civil helicopters, but only 4.5% of military orders. Bigay puts the blame for this on Dutch and UK decisions to buy the Apache attack helicopter instead of the Eurocopter Tiger.

Bigay reveals that there has been intensive lobbying to save the Tiger and the pan-European NH-90 transport helicopter from French defence cuts, and says that there is increasing optimism that a compromise will be reached on service- entry dates. He warns that delays to the programme could have serious consequences for export chances.

Snecma chairman Bernard Dufour had already revealed that the group is to step up its cost cutting drive, in an effort to stem heavy losses. The group's year-old recovery plan, implemented by Dufour after he took the reigns at Snecma, already appears to be producing savings.

During 1995, the workforce fell to 11,000, after the shedding of more than 2,000 jobs and another 805 are to disappear from the payroll this year. The plan calls for annual savings of Fr1 billion by the end of 1997, which should be enough to put Snecma back in the black.

Dufour says that the recovery is on course, with the Fr2.2 billion of losses made in 1994 halved over the past year. Although Snecma's orders continued to slide in 1995, falling by 16% to Fr8.6 billion, Dufour estimates that they are likely to climb back above Fr9 billion this year as civil markets pick up.

He warns, however, that cut-throat competition is continuing to drive down prices in the big turbofan market, where Snecma competes as a 25.5% partner, on the General Electric GE90. Around one-third of Snecma's losses are attributed to its participation on the programme.

Source: Flight International