EADS blames UK for placing programme at risk

Europe's four-nation Eurofighter programme is facing a break in production and a huge cost overrun as a 31 July deadline to agree a framework for a Tranche 2 contract appears set to pass without resolution.

At Farnborough International, Eurofighter chief executive Aloysius Rauen warned that the programme's partner companies - Alenia Aeronautica, BAE Systems and EADS - have already held initial consultations with unions over a possible break in production of the aircraft. Workers could be placed on reduced hours and orders for long-lead production items could lapse, resulting in a one-year programme delay. Eurofighter estimates this ramping-down of production activities would result in extra costs of €1-2 billion ($1.24-2.5 billion), he says.

EADS has singled out the UK as placing the programme at risk, noting that Germany and Spain have provided the necessary commitments and Italy is "close". Tom Enders, head of EADS's defence and security systems division, says: "The four governments wanted to have the Tranche 2 contract signed by the end of July to avoid delivery problems in 2007. He adds: "It seems three parties have done their homework and one hasn't."

Visiting the show on 20 July, UK secretary of state for defence Geoff Hoon said he was "confident we will reach an appropriate decision for the partners and for industry", but crucially declined to provide a timescale for closing this process. The UK also wants to introduce a limited air-to-ground weapons capability with its last Tranche 1 production aircraft, but the partners have yet to agree on how the costs should be divided.

Another implication of missing the deadline will be Eurofighter's need to negotiate a new Tranche 2 contract with the NATO Eurofighter and Tornado Management Agency, says Rauen.



Source: Flight International