Tim Ripley
America's giant defence and aerospace market is a major target for the newly-formed EADS (European Aeronautic Defence Space company), according to Jean-Louis Gergorin, its executive vice-president for strategic co-ordination.
"Our next step is transatlantic the US is the largest defence market in the world and we know we have major clients for A3XX in the US," Gergorin told the Financial Times World Aerospace and Air Transport Conference prior to Farnborough 2000. "We want to make small, limited involvement in US companies, to see joint ventures between the US and Europe in defence electronics, helicopters and space. We intend to benefit from that. We have strategic dialogue with the four major players in the US. There is co-operation with Boeing on the Meteor air-to-air missile and intense dialogue with Raytheon."
Gergorin stresses that these are long-term ambitions: "Our priorities in the coming months are internal, to fully realise synergies (from the merger that formed EADS) in an environment of growth."
The company was still looking to develop new European partners and aiming to consolidate its existing partnerships. "In future there will be less spectacular consolidation in Europe, perhaps more in northern and central Europe."
Future
He adds the company's priorities for future consolidation include restructuring existing partnership with BAE Systems in Airbus, extending the Astrium space joint venture to include Italy's Finmeccanica, expanding export sales of Eurofighter, and opening a strong partnership with Finmeccanica in the European military aircraft joint venture. "We have talked to Thomson-CSF, we have a lot in common with them. We want to create new links into the European defence business," Gergorin says. EADS formally came into existence earlier this month after a link-up between France's Aerospatiale-Matra, Germany's DASA and Spain's CASA. Gergorin says the driver for the consolidation was a shrinking European defence budget, the need to consolidate research and increase efficiencies. He says the Europe consolidation process was different from that in the US: "70% of our constituent business was already organised in programme partnerships or joint ventures. US mergers forced competitors together, in Europe it involves existing partners.
"EADS is not pulling together competing businesses, as is the case of Lockheed Martin and Boeing, we are eliminating and reducing layers of management in existing joint ventures, such as Astrium, Airbus and Eurocopter.
"EADS has eliminated French government involvement in any operational management. We are aiming for ñ500 million ($465m) in additional synergies, half from purchasing savings and half from getting rid of layers of management. We have two chief executive officers, that is the only redundancies in our structure. In functional and operational jobs there is only one head. We have two CEOs to address German and French defence markets."
Source: Flight Daily News
