Like once-indulgent parents whose patience with the wayward antics of their offspring has been exhausted, EADS's board of directors will in future keep a much closer watch on the everyday operations of Airbus. After years of operating independently of its main shareholder, Toulouse - it might be said - is no longer too loose.
Changes announced last week have seen the board - under joint chairmen Manfred Bischoff and Arnaud Lagardère - tighten its grip on its biggest division. The most important sees Fabrice Brégier switch from running EADS's helicopter business to the number two position at Toulouse. As chief operating officer, the 45-year-old - who has proved his mettle at Eurocopter and missile house MBDA - will be Airbus chief executive Louis Gallois's representative on Earth. His main task will be to ensure the A380 programme and challenging €2.1 billion a year ($2.68 billion) "Power8" cost-cutting drive announced by Gallois's short-lived predecessor Christian Streiff four months ago are kept on track.
Brégier's job is similar to the one held by Gustav Humbert who for years was Noel Forgeard's chief operating officer before being elevated to chief executive last year when Forgeard was himself promoted to the top job at EADS alongside Tom Enders. Humbert resigned along with Forgeard after the A380 programme's problems became evident earlier this year.
It will mean the two most senior positions at Airbus are held by Frenchmen, a significant development given the efforts EADS has gone to in the past to maintain the delicate balance between citizens of its two biggest shareholding countries when dishing out top jobs. Has the Franco-German giant accepted that appointing the best person is preferable to ensuring the right passport?
"Where Brégier may be able to make a difference is in achieving a smooth integration - in short, overcoming the issues of nationality," says analyst Sandy Morris of ABN Amro. He argues that Brégier's time running the Franco-German Eurocopter as well as the BAE Systems, EADS and Finmeccanica-owned MBDA has left him well-equipped to straddle national rivalries inherent in cross-border aerospace ventures.
Morris also believes Brégier is being groomed for a bigger role, once 62-year-old Gallois retires. "You sense Brégier has the ability to make it to the top, and becoming COO of Airbus is a good stepping stone," he says.
Brégier's appointment is not the only significant change in the Toulouse boardroom. EADS's chief financial officer, Hans Peter Ring, will add the same role at Airbus from January. Ring, a German, will replace Andreas Sperl, who will "move to another operational function" in EADS. This highlights the determination of the board to prove to investors that the airframer's tough financial targets are being taken seriously. However, Sperl's sidelining also extends the purge of key managers - including Humbert and his successor as Airbus chief operating officer, Charles Champion - seen as responsible for the A380 delays. Morris says the axing of well-regarded executives has been inevitable: "The A380 happened on their watch."
Another paragraph in last week's announcement says that Enders and Gallois will "regularly report on all major projects, programmes and matters of importance - including Airbus - to the two EADS chairmento better prepare board discussions and decisions". As the EADS board prepares to decide whether to give the green light to the launch of the A350, this is a clear admission by the board that it was being kept in the dark in the past over problems at Airbus.
EADS's desire for what it calls "increased transparency" will be helped by the fact that it can finally call Airbus its own. EADS's £1.9 billion ($3.6 billion) offer for BAE Systems' 20% share in the airframer was formally accepted by the UK company's shareholders last month. Although British expertise in wing design was crucial to the old Airbus when it was a four-nation consortium, BAE's minority stake in the combined Airbus entity was a management complication. The need for Airbus chiefs to report simultaneously to both parent companies made week-to-week control by its 80% shareholder difficult.
Brégier's replacement at Eurocopter is less well known. Until April - when he was promoted to head Eurocopter Deutschland, one of Eurocopter's two manufacturing arms - Lutz Bertling, 44, held the relatively lowly position of executive vice-president, governmental helicopters. He joins the EADS executive committee, reporting to fellow German Enders.
EADS may have abandoned its tortuous requirement that French senior managers report to Germans and vice versa, but national questions still loom large over EADS ownership. With German car giant DaimlerChrysler looking to cut its shareholding from 22.5% to 15% next year, the Germans could draw up a complicated arrangement whereby the remaining 7.5% is sold as a bond to a consortium of German banks to keep enough ownership in Germany. With the Spanish government keen to up its 5.5% share and Russian state-owned bank Vneshtorgbank buying a 5.6% share in EADS in free floating shares last month, there are still plenty with faith in Europe's great aerospace project.
Source: Flight International
