Aerospace manufacturing activity in Europe no longer tenable: EADS CEO Gallois
17 Apr 2008
EADS CEO, Louis Gallois, has said that his Group, Europe's largest aerospace and defence manufacturer, and subsidiary Airbus, which, along with Boeing, is one of the world's two largest aircraft manufacturers, is doing a serious rethink about the way it does business and is strongly mulling moves to relocate or start more of its manufacturing activities outside Europe.
Though similar sentiments have been expressed earlier by Gallois and Airbus executives, Gallois' statement is perhaps the strongest expressed so far. He took the help of an analogy from Greek myths to highlight the fiscal plight of EADS and Airbus.
Speaking to reporters in Paris yesterday, Gallois spoke about the impact on aerospace manufacturing in Europe that the rising euro/sinking dollar was having. "We are at levels which are becoming unbearable," he said. "We cannot stay under this Damocles sword, which is starting to fall."
Gallois said that each 10 cent rise in the euro, compared to the dollar, costs Airbus €1 billion ($1.59 billion) as it manufactures in euro costs and sells in dollars. "We will have to take structural decisions on desensitizing the company to the dollar," he said.
