CHRISTINA MACKENZIE / PARIS
The French government is investing another €1 billion ($1.1 billion)in ailing state-owned defence manufacturer Giat Industries. Defence minister Michéle Alliot Marie says the government decided to keep the company open because "we want to keep a land armaments industry in France". But she adds that in return Giat will have to cut 4,000 of its 6,262 employees and close three factories. The French government has invested €3.4 billion in Giat in five previous restructuring efforts over the last decade, but the company has continued to make losses. In the long term, says chief executive Luc Vigneron, Giat needs to team up with another European arms manufacturer, and becoming more competitive and profitable are "indispensable conditions for any future alliance".
In 2002 Giat made a net loss of €118 million, its best performance of the past five years, but took only €45 million in orders.
Giat's aerospace activities will not be affected by the cuts. The company is in partnership with General Dynamics Armament Systems to produce the turreted 20mm gun system for the Boeing Sikorsky RAH-66 Comanche combat helicopter, and will supply THL30 30mm gun turrets for the Eurocopter Tiger HAP, starting this year. Giat also produces gun pods for the Dassault Mirage F1 and Mirage 2000.
Source: Flight International
