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Airbus emerged from one damaging battle but looked set to plunge into another, as workers staged walkouts and threatened wider strikes over expected job losses, plant sales and other restructuring measures to be announced today.

 

 

A day after directors of Airbus parent EADS unanimously approved the "Power8" turnaround plan, ending a week-long dispute between French and German shareholders, the European aircraft maker's main French labor union called the cutbacks "a declaration of war."

 

As widely reported, the plan will lead to about 10,000 job losses among Airbus staff and subcontractors, a person close to the company said. Airbus currently employs about 56,000 workers.

 

About 4,300 of the job cuts will be made in France, 3,900 in Germany, 1,000-1,500 in Britain and 500 in Spain, said the person, who asked not to be named because the plans were still confidential.

 

 

Airbus will seek buyers for its Meaulte and Saint-Nazaire-Ville production sites in France, Germany's Nordenham and Varel plants and the Filton site in Britain, the person said. The company is seeking investors to run the sites as subcontractors on Airbus jet programs but may be forced to close the Saint-Nazaire plant, which employs 900 workers.

 

Staff at the Meaulte facility, which makes nose cones for Airbus airliners of all sizes, staged a stoppage yesterday in protest at the anticipated cuts. Almost all the plant's 1,700 workers took part in the spontaneous strike, Airbus confirmed.

 

"That was a warning strike. It's supposed to show what can happen if the rumors about the job cuts come true," said Peter Scherrer, head of the European Metalworkers' Federation in Brussels, where officials from Airbus unions in France, Germany, Britain and Spain met yesterday and warned of bigger strikes.

 

Force Ouvriere, the strongest Airbus union in France, called on workers from all four countries to "get together and get mobilized" to defeat the plan.

 

"If the Saint-Nazaire or Meaulte sites are closed or sold, Force Ouvriere will take this measures as a declaration of war," the union said in a statement.

 

First announced last year after a two-year production delay to the double-decker A380 wiped US$6.6 billion off profit forecasts for 2006-2010, the Power8 program aims to claw back the same figure in cost reductions over the period and generate US$2.8 billion in annual savings in later years.

 

Airbus has been badly hit by the weakness of the US dollar, the currency in which its planes are priced, and is expected to shift more of its supplier costs and contract work to dollar-linked economies as part of the restructuring effort.

 

It also has to fund development of the A350, its US$15.3 billion answer to the runaway success of US rival Boeing Co.'s 787 in the lucrative market for long-range, mid-sized planes.

 

Airbus CEO Louis Gallois had been forced to postpone the restructuring announcement, originally scheduled last week, and propose changes to the plan after the main EADS shareholders failed to agree on the distribution of job cuts and new technologies between France and Germany at a February 18 board meeting.

 

Core German shareholder DaimlerChrysler AG's 22.5 percent share of voting rights is matched by the combined EADS stake held by the French government and Paris-based Lagardere SCA. Unlike the French state, which owns 15 percent, Berlin has no direct stake in the company but leans heavily on decision-making as its largest single defense customer.

 

German Economics Michael Glos, who earlier this month said EADS could lose defense contracts if it cut too many jobs in the country, said the burden of cuts appeared to have been spread equally by final version of the Power8 plan.

 

"According to the information I have, I don't know the details, a good solution has been reached after tough negotiations," Glos said in Brussels.

 

Under the plan, final assembly of the A350 will be based exclusively in France, the person close to Airbus and a German official familiar with the discussions both said, instead of being split between Germany and France as programs traditionally have been. In exchange, a future revamp of the single-aisle A320 plane will be assembled in Germany.

 

The increased use of composites in the A350 has raised doubts over the future of the Nordenham plant in Germany, where over 2,100 workers produce metal fuselage panels for current Airbus models.

 

EADS and Airbus refused to give any details on the planned cuts or production shake-up, saying details would be announced only after staff representatives are informed this morning.

 

Shares of European Aeronautic Defence and Space Co. fell 1.8 percent to close at US$33.67 in Paris.

 

(Shanghai Daily March 1, 2007)