Airbus says 3,700 jobs hit by slower A380, A400M deliveries

By Cyril Altmeyer

PARIS (Reuters) - Airbus on Wednesday confirmed lower production rates of its A380 superjumbo and A400M military aircraft and said up to 3,700 jobs would be hit in France, Germany, Britain and Spain.

Dubai's Emirates saved the A380, the world's largest passenger jet, from death row in January with an order worth $16 billion at list prices. But demand elsewhere remains weak and Airbus said it would fall to six A380 deliveries per year as of 2020, from an anticipated 12 deliveries this year.

Meanwhile, its A400M programme has been beset by delays and cost overruns. Deliveries of the new troop transporter will slow to eight in 2020, compared with 15 this year and 11 in 2019, following discussions with nations which are launch customers.

Airbus had presented the adjustments to its European Works Council and would now enter formal negotiations with staff representatives at European and national levels, the company said in a statement.

"About 10 sites will be impacted in Europe. Most workers will be redeployed," an Airbus spokesman said, without giving further details on the sites involved.

Trade unionists present at the Works Council meeting said Britain's Filton site, plants in Germany's Bremen and Augsburg, and Spain's factory in Sevilla would be the main ones affected.

Yvonnick Dreno, a senior Force Ouvriere unionist said 1,925 jobs would be affected in Germany, 860 in Spain, 465 in Britain and 470 in France.

"We believe the redeployment to other programmes will be relatively easy in France," he told Reuters, adding that reassigning workers would be harder in Spain and Britain where production is more focused on the A400M.

WEAK SUPERJUMBO SALES

Emirates' order for 20 of the double-decker A380, with an option of 16 more, handed a lifeline to the slow-selling aircraft, in service for just 10 years, and rescued one of Europe's most visible industrial symbols overseas.

At a delivery rate of six per year, the A380 programme will make a loss. Airbus hopes the Emirates agreement spur orders from other airlines.

"At a baseline of six deliveries per year, Airbus can produce the A380 in an industrially efficient way over the coming years. This baseline allows Airbus to pursue further sales campaigns which may lead to higher production levels," Airbus said in its statement.

IAG, which operates British Airways, Iberia, Vueling and Aer Lingus, said on Tuesday it would consider buying more A380s if the aircraft was cheaper.

Sales of the A380 have disappointed in the face of strong competition from smaller, more flexible twin-engine jets that are at least as efficient. The A400M, Europe's largest defence project, has faced chronic delays and glitches.

Airbus struck a draft deal last month with European buyer nations of the A400M to revamp delivery schedules and ease cash retention clauses but was forced to write off another 1.3 billion euros on the loss-making project.

(Reporting by Cyril Altmeyer; Additional reporting by Sudip Kar-Gupta in Paris and Alexander Hubner in Munich; Writing by Richard Lough; Editing by Leigh Thomas and Edmund Blair)