The planned merger of Germany's DaimlerChrysler Aerospace (Dasa) and Spain's CASA has sparked a bout of honesty from Europe's major industry players, suggesting that further consolidation is now a distinct possibility on a handful of crucial fronts, but that the grand project of pan-European integration across all sectors is fading fast.
On one hand, with respect to Airbus Industrie, the deal seems set to kick-start the process of establishing the business as a single corporate entity (SCE), a process that has been stalled since the all-French marriage of Aerospatiale and Matra Hautes Technologies was announced last year.
On the other hand, however, the meltdown of Europe's major industry players into a single aerospace and defence company (EADC) now appears to be a non-project, with British Aerospace (BAe) distancing itself from the ideal and the continent's other big manufacturers playing down the importance of further European moves and, like the UK giant, talking up the need for a global strategy and the lure of "transatlantic options".
The acceleration of Airbus towards SCE status may be aided by a request from industry ministers representing the consortium's four nations for new proposals - to be submitted in the next three months - on consolidating the business, and the (albeit tentative) linkage between the acceptance of a new plan and the availability of research and development funding for the A3XX.
It is, though, the Dasa-CASA deal, and not funding threats, which look most likely to free up the SCE process. BAe, for one, is convinced that the shrinking of a four-member consortium to a three-member one will have a major impact, even if CASA seeks to retain a voice at meetings.
One more deal, it reasons, and a SCE can be achieved through a simple merger of the two remaining Airbus entities, and to this end it effectively offered at the Paris air show to make BAe Airbus immediately available for merger with the Airbus businesses of either Aerospatiale or Dasa-CASA.
Some sources even suggest that BAe is no longer fully intent on retaining a stake in the Airbus SCE that will eventually emerge, and that it may be willing to sell off its holding in the consortium and focus its energies fully on the military market. The same sources point out that its commitment to the regional air transport sector has already weakened.
Recent reports in Spanish newspapers suggest that state-owned Spanish holding company SEPI is keen to promote the new Dasa-CASA as a vehicle for further integration, with its president, Pedro Ferreras, eager to broaden the ownership of the new company to include the other companies that bid for CASA - BAe, Aerospatiale and Italy's Finmeccanica.
A senior source at Finmeccanica suggests that the approach would probably centre on the consolidation of Airbus interests rather than wider aerospace operations, while admitting Italy into the business, as recently requested by Rome.
As far the EADC is concerned, recent moves seem to have done little to restore momentum to what seems to be a fast-fading ideal. At a Paris press conference, BAe chief executive John Weston was at pains to emphasise that the UK giant never sought the consolidation of all of Europe's major players - spread across at least six countries - into one.
"We did not see the European structure we were trying to put together as 'everything must go in'," he says. "It was the UK, France and Germany, and we brought Spain, Italy and Sweden in. But as far as we were concerned it was always impractical to bring eight companies together. We were not talking about 'fortress Europe'."
BAe now claims that it has always viewed European integration as part of a policy of building up a worldwide presence, and Weston is at pains to stress that the company's move for Marconi Electronic Systems was inspired by neither UK imperatives nor European ones, but by the need to build up BAe's size in order to enter the global bidding as a serious player. He also implies that a merger with a US manufacturer is now close to the top of his company's agenda.
"We want to compete in one of the two companies that will come out of the globalisation process," he says. "And we think BAe-Marconi is a step towards that goal and leaves us only one or two steps away from it. We see a future built on strategic alliances."
"Our vision was always that if we were on our way to a global company at some point we needed a transatlantic link - but at BAe we were not large enough to make that link without putting the company up for sale. So we wanted to grow so that when we come to do that we are of sufficient size."
BAe's next move is, to an extent, likely to be dictated by the actions of other European players. If Aerospatiale Matra is prepared to return to the table then an Anglo-French deal may no longer be out of the question, while further consolidation on a sectoral basis is certainly one of its aims.
Here, Finmeccanica's stance regarding Alenia Marconi Systems (AMS), a joint venture with BAe's new UK partner, is crucial. BAe is keen to fold the business into Matra BAe Dynamics, with Aerospatiale's missiles venture also thrown in, but Finmeccanica is playing hard-ball, insisting that AMS should not be broken up and demanding a high price for any compromise.
Whereas Finmeccanica is regarded as a desirable suitor by Europe's bigger players, Thomson-CSF, so far left trailing in the wake of the mega-mergers, is seen either as a poor fit or a poor prospect. Neither are US companies keen to move for Thomson, wary as they are of the French statist tradition.
While not talking up the US option in the manner of BAe, Dasa is known to have cast its gaze across the Atlantic, and at Aerospatiale Matra, senior executives - including Jean Luc Lagardere - have begun to speak freely of the need for adding a global aspect to their operations.
Airbus, then, seems to be on the bring of real transformation, with a much wider deal still far over the horizon, and the likelihood of a ground-breaking Euro-US tie-up - US regulatory hurdles notwithstanding - looming larger all the time.
Source: Flight International