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EADS lands a huge contract with the U.S. air force.

Translated Friday 14 March 2008, by Gene Zbikowski

Aeronautics. The 179 Airbus A330 air-freighter type aircraft will be assembled in the United States. For the CGT, a French trade union, this piece of good news will not reverse the on-going downsizing plan.

Toulouse, by our regional correspondent.

An exceptional contract has been landed by the parent company of Airbus, the EADS group, which put in its bid in partnership with the American company Northrop Grumman. The Pentagon has decided to attribute the first phase of the modernization of its fleet of air tankers to the European aircraft maker.

The 35-billion-dollar contract is for 179 KC-30 aircraft, a modified version of the Airbus A330. The overall contract is estimated at 100 billion dollars over 30 years. Boeing had already obtained a similar order in 2003, which was cancelled due to proven fraud.

“This is an unprecedented triumph, a matter of great pride for EADS,” Louis Gallois, the executive president of EADS, said. With the “2020 vision” plan, EADS’ objective is to increase its market share in the defense sector. Nicolas Sarkozy and François Fillon have also hailed this huge aeronautical order. The French president stated that “the consolidation of defense capacities, including industrial defense capacity, will be one of the priorities when France assumes the rotating presidency of the European Union. For his part, the prime minister argued that the contract will create jobs at the Méaulte and Saint-Nazaire sites, which are involved in making the airplane’s nose and fuselage.

On the other hand, the directors of EADS have announced that the A330 air freighter assembly line and the creation of 1300 jobs will be relocated to Mobile, in the American South. A few days ago, Tom Enders, the president of Airbus, backed this decision, which is “in line with the strategy of the group, which is to become more international, (...) to allocate more work to the dollar zone.” The executive president of EADS, Louis Gallois, made no secret of his decision, taken at the end of 2007, to relocate part of Airbus’s production to the dollar zone. An A320 assembly line is being built in China.

The trade union leaders at Airbus are happy at the contract that their group has landed while worrying about a new and significant transfer of production, this time the United States. Today, the A330 is assembled in Toulouse. “We would evidently have preferred that the assembly of air tankers be done in Europe, but the establishment of the assembly line in the United States was part of the contract. It’s an excellent compromise for us,” Gilbert Plo, the main CFTC trade union leader at Airbus, told Reuters. “We are delighted by this announcement, the attribution of the contract by the American air force is no run of the mill matter, so we may well celebrate,” said Maryline Brugidoux, the CFE-CGC trade union leader at Airbus.

On the other hand, Xavier Petrachi, the CGT union leader at Airbus said that “While this huge command is a very good piece of news for Airbus, it cannot make us forget our bitterness and worry, because it won’t at all change the on-going savings and downsizing plan, or the sale of industrial sites like Méaulte and Saint-Nazaire.” The union leader added that “the contract may even accelerate the realization of the Power 8 savings and job cut plan, despite Airbus having a record number of orders in its books.”

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