Downturn squeezes cash pile: EADS

I / Paris December 7, 2009, 16:21 IST

The European Aeronautic Defence and Space Company (EADS) which builds Airbus airliners said today that a slowdown in activity was squeezing the group's cash mountain but assured that the programme for the new A350 was safe.

The EADS Chief Executive Louis Gallois told the Financial Times newspaper that the group was gearing up to begin production of the first A350 long-haul jetliner early next year.

The aircraft is set to enter service in 2013.

However, Gallois also said that a decision to slow down production of the group's superjumbo A380 airliner and of some mature models, owing to the global economic downturn, together with decisions for deferred delivery of aircraft, were "creating an impact on the cash situation of Airbus".

The A350 programme is estimated to cost $17.9 billion. Gallois said that although he expected the governments which support EADS, those of France, Germany, Britain and Spain, to help with loans, EADS was financing most of the cost out of its own resources.

However, he said that the "A350 is fine" and EADS had no intention of seeking funds from shareholders.

"We have net cash of more than euro 8 billion," he told the newspaper. "When you are in such a situation, you do not ask your shareholders for funds."