PAUL LEWIS /WASHINGTON DC
Politicians and industrialists claim political intervention blocked cheaper P&WCoffer in favour of European rival
The US Congress and United Technologies (UTC) are outraged at EADS's selection of Europrop International (EPI) rather than Pratt & Whitney Canada (P&WC) to power the Airbus Military A400M transport. They claim the decision was politically rather than price-based after Airbus had earlier stated the PW180 offer was 20% cheaper.
The EPI TP400-D6 turboprop choice has exacerbated already strained transatlantic political relations and threatens to rekindle an aerospace trade war with talk of rule violations and retaliatory action. "It's not an economic decision, a rational decision, but a political decision that will make the relationship between France and the USA even more difficult," Representative John Larson told the AFP news agency.
Although EADS's decision was made in line with an Airbus recommendation, US anger is directed at French President Jacques Chirac and his alleged insistence on a European engine being selected. UTC chairman George David believes the PW180 was Airbus's first choice. "We had a compliant, solid, really good winning proposal, where Airbus seemed like they wanted to select us and where it got deselected at the 11th hour and 59th minute," says David.
A complaint could now be lodged with the World Trade Organisation. Senator Joe Lieberman says: "This blatant protectionism threatens the confidence necessary for free trade to flourish and invites similar tactics."
Over the past few weeks, the engine choice had become highly political in Europe and, as a result, EPI was given a last chance to match P&WC's price. Snecma chief Jean-Paul B‚chat says the P&WC offer "incited us to lower our own hopes on this programme", and that recent declarations by Airbus chief executive Noel Forgeard favouring the Canadian engine because it was cheaper "pushed us into making a few additional efforts". MTU, Rolls-Royce and Snecmaeach have a 28% stake in EPI, with Spain's ITP holding the remainder.
B‚chat admits that EPI "will probably not earn a great deal" on the contract. "We had political logic on our side but we were against very tight price objectives," he says, adding that the choice of a European engine "is extremely logical and a choice that should not have come as a surprise".
The decision clears the way for the pan-European procurement agency OCCAR to sign the A400M contract with Airbus Military, once the seven participating nations have signed the memorandum of agreement. EPI intends to have the first engine in test in the third quarter of 2005.
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