PLANS BY Daimler-Benz Aerospace (DASA) to offer its high Deutschmark costs by placing work in Italy have been hit by delays over the failure by prospective Italian aerospace partner Alenia to produce long-term guarantees that it can offer substantial cost benefits.
DASA had hoped to tie up the alliance by the end of 1995, but admits that talks have dragged on over the issue of costs. The company says that it is looking for "substantial and durable low-price guarantees" before a deal is signed. Alenia blamed DASA's financial problems for the delay.
A memorandum of understanding was signed with Alenia in 1995 which promised to see DASA place "several work packages" in Italy, provided the subcontractor promises to run the work at competitive world rates. The work is expected to centre on fuselage parts.
DASA's problems were highlighted by 1995 losses ten-times higher than the previous year's. In spite of this, the company claims it will be back in the black 1997.
Revealing a 1995 deficit of DM4.3 billion ($2.9 billion) on a turnover of more than DM15 billion, DASA president Manfred Bischoff claimed that it had been a "difficult, yet successful year". By comparison, the company made a DM438 million loss on a DM17.4 billion turnover in 1994.
"Our goal is a positive result in 1997 at the latest," says Bischoff. The losses include a DM2.3 billion write-off following the withdrawal of financial support from stricken Dutch daughter company Fokker.
Speculation is rising that Bombardier has made a bid for Fokker.
The result was also affected by the weak dollar and DASA's restructuring plans, which will lead to the sale of three plants and a cut in the workforce of 17,784 personnel, to 38,000 by the end of 1998.
The successes Bischoff referred to included a return to profit in the defence field, and the acquisition of new projects in the space sector.
Aircraft group president Dietrich Russell says that the five divisions - Airbus, Fokker, Dornier Luftfahrt, Military Aircraft and Eurocopter - achieved a 1995 turnover of DM8.5 billion.
While Airbus lost a substantial slice of market share in 1995, Russell emphasises that it has become an even stronger focal point for DASA in the light of the Fokker withdrawal.
Source: Flight International
