Decision to go ahead with second tranche of 236 aircraft welcomed by suppliers after earlier delays hit margins
Industry suppliers to the Eurofighter Typhoon are breathing a sigh of relief after the long-delayed signing of a €16 billion ($21 billion) order for the second tranche of 236 aircraft.
Eurofighter chief executive Aloysius Rauen says the order, signed on 14 December, was achieved only after "hard but fair" negotiations, adding that it "meets the structure of the umbrella contract signed in 1998 splitting production into three tranches". Production is now guaranteed, he adds, until 2013.
Suppliers had become increasingly concerned after Eurofighter had warned earlier this year that the four-nation programme was in danger of a costly gap in production. They warned that further delay would affect their business plans and many had already introduced "soft" measures to protect against losses resulting from the existing slippage.
In September, major supplier Cobham complained that the delays had hit margins to the tune of 1%. Cobham chief executive Allan Cook says the order "is not only good news for Cobham, but excellent for the UK industry. We're delighted to see the results of many hours and days of detailed negotiations between the partners and government."
Suppliers of long-lead items faced the greatest difficulty, although many were given assurances by the UK Ministry of Defence that they could go ahead with initial procurement and preparation for production. Eurofighter admits that the delays "have made it very uncomfortable" for suppliers, adding that the order is a "huge relief for the four partners".
EADS, one of the Eurofighter partners, says: "We were always confident it would come, but of course we are delighted the contract has been signed."
JULIAN MOXON / LONDON
Source: Flight International