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A400M Transport Plane Faces New Delay

Wednesday 26/09/2018 - Source: Boeing


Europe's largest military project suffered a new blow on Thursday when Airbus parent EADS indefinitely postponed the maiden flight of the A400M transport plane in a row over engine development, abandoning efforts to fly it this year.

The latest delay in perfecting urgently needed airlift capacity for seven European NATO nations looks set to widen a rift between EADS and Europe's top engine makers. It comes on top of a two year delay in building the Airbus A380 civil superjumbo.

However shares in EADS jumped more than 6 percent as its rival Boeing faced deepening production problems of its own, with an assembly strike well into its fourth week.

The date for the A400M's first flight has slipped progressively from an original goal of January 2018 and EADS had most recently said it "hoped" to get it aloft by year end.

EADS did not give a new target date for flying the plane, which it is developing at a cost of EUR20 billion euros (USD$29.46 billion) and which it rolled out in front of the King of Spain in June.

But it put the spotlight on engines built by a group led by Britain's Rolls Royce and Safran of France as well as the related systems and software.

"The first flight depends on the results of the test campaign to be done on the flying test bed, which should start in the coming weeks, and on the readiness of the propulsion system," EADS said in a statement.

"Only after this and further discussions with customers, can the financial, technical and schedule implications be reliably assessed."

The flying testbed is a Lockeed C-130 Hercules, the model the A400M was designed to replace, converted for engine testing.

EADS last year took EUR1.4 billion of provisions for delays in developing the A400M, citing engine problems, and said this took account of delays between six and 12 months.

Extending the first flight delay beyond a year increases the risk of corresponding delays in deliveries, which could lead to deferred cashflow and penalties being applied by customers.

Senior Airbus officials say there is a close link between the timeline for flight testing and any delivery delays.

However EADS said it was sticking to its financial targets for 2018, indicating it did not immediately foresee further provisions due to the new delay. EADS is targeting 2018 sales of over EUR40 billion and operating profit around EUR1.8 billion.

A German magazine last week reported that EADS, whose Airbus unit has already had to pay hundreds of millions of dollars in damages for late delivery of the A380 superjumbo, had appealed to European governments not to impose fines for A400M delays.

EADS declined to comment on the report which comes amid wider tensions over some nations' reluctance to honor orders of the Eurofighter, suggesting a possible trade-off over penalties.

The German defence ministry, a key client for the new aircraft, said it was still expecting A400M delivery in 2011.

"We believe the contracts are still valid," the spokesman said, noting fines could be imposed for late fulfillment.

Delays in supplying the West's largest turbo-prop engines for the A400M have produced months of friction between EADS and the consortium of engine makers and exposed the risks of developing a new plane and new engines simultaneously.

Airbus originally planned to use off-the-shelf engines from Pratt & Whitney Canada but was ordered by commissioning governments -- France, Germany, Britain, Spain, Turkey, Belgium and Luxembourg -- to favour a European solution.

Britain in particular put pressure on Airbus to include Rolls Royce in the project, according to defence sources.

"It is a mess. Too many political decisions were taken early on," said an industry executive familiar with the project.

Enginemakers refused to shoulder the blame.

"The engine was delivered at end-2017 and we delivered flight-worthy software in April and have been waiting since then for the aircraft to fly. Nothing from the engines prevents it flying," said a senior executive, asking not to be named.

An EADS source argued no military aircraft in the last 40 years had been delivered on time. None of the sources agreed to be identified because of the sensitivity of the matter.

In one recent snag, engineers successfully ran the A400M's TP400 test engine on the ground but the heat it produced damaged part of the testbed Hercules, an Eisenhower-era warhorse built to survive the toughest conditions. Heat shields were added.


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