France’s deadline to resolve EADS crisis expires

Rory Mulholland
PARIS, June 27, 2006 (AFP) – The French government’s self-imposed deadline to resolve a crisis at EADS, and get the company’s Airbus unit back in the battle against arch-rival Boeing, was due to expire later Tuesday.

 There was widespread speculation that the position of EADS’ co-chief executive Noel Forgeard was insecure and that he might be replaced by Louis Gallois, the head of the French state-run railway SNCF.

French President Jacques Chirac said late Monday that "something probably needs to be done and something will be done" to resolve the crisis that erupted when EADS announced a six-month delay in the delivery of Airbus’ A380 superjumbo aircraft.

Finance Minister Thierry Breton held talks on Monday with key private shareholders in EADS, the French media and technology group Lagardere and the German industrial giant DaimlerChrysler. The French state owns 15 percent of EADS.

But sources said that Breton would have difficulty in meeting the deadline he set himself on Saturday to resolve the situation within 72 hours.

The turbulence started at EADS when its aircraft unit, Toulouse-based Airbus, said on June 13 there would be further delays in delivering the A380, the world’s biggest commercial aircraft and the company’s biggest weapon in its fight against US competitor Boeing.