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Airbus profits hit by A400M costs


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Airbus profits hit by A400M costs

Airbus has announced even more costs from its much delayed A400M military transport plane, hitting its earnings.

Revealing a 63 percent fall in profits for the aerospace group in 2016 it said the aircraft had swallowed up another 2.2 billion euros in charges last year.

The company now wants new talks with its customers, the governments of Belgium, Britain, France, Germany, Luxembourg, Spain and Turkey, to ease the “heavy penalties” imposed for delivery delays.

Major headache

Europe’s largest defence project has been a major headache for Airbus since it was conceived in 2003.

Chief Executive Tom Enders declined to say whether Airbus would threaten to stop building the plane but he denied that the project is in the same dire financial straits as seven years ago.

In 2010 Airbus won a 3.5 billion euro bailout from the seven NATO nations after being saddled with liability for massive cost overruns on the plane’s engines.

Record deliveries

The costly A400M problems overshadowed stronger than expected full-year net earnings of 995 million euros boosted by record deliveries of commercial airliners though there was a drop in orders.

On two broadly successful civil projects which have seen delays creep into the schedule in the past year, Airbus said the production ramp-up of A350 and A320neo jets remained “challenging”. But bottlenecks in the A350 supply chain had improved and its output targets remained on track.

Airbus confirmed a projection of more than 700 jetliner deliveries in 2017, up from a record 688 in 2016.