Airbus chief Louis Gallois announced plans to lay off 4,300 workers in France, 3,700 in Germany, 1,600 in Britain and 400 in Spain over the next four years. Roughly half the cuts will come from the 57,000-strong Airbus work force and the rest from subcontractors, which currently employ a further 30,000 staff.
The company said that it will seek to avoid forced redundancies by using voluntary schemes such as early retirement, but made no promises. "Should these schemes not generate the expected level of reductions within the next twelve to eighteen months, other measures will have to be considered," Airbus said.
Nevertheless, the announcement immediately spurred strong reactions from workers both in France and Germany, with spontaneous walk-outs by staff and other work stoppages. Joint actions are being planned.
No decision has yet been taken as to which, if any, of Airbus's 16 factories, spread across the UK, Spain, Germany and France, could be closed – largely due to the failure of these countries to reach a compromise on the matter.
The four EU members must now decide whether they wish to introduce a request for aid from the EU under its €500 million globalisation fund, available since 1 January this year, to give a helping hand in cases where more than 1,000 workers are made redundant because of "major structural changes in world-trade patterns" (EurActiv 14/12/06).
The lay-off plans are part of a general restructuring programme, disclosed on 28 February and dubbed Power8, aimed at making Airbus – which has admitted that its current financial situation is "unsustainable" – more efficient in view of facing up to increased competitive pressure.
Airbus hopes that its cost-cutting scheme will liberate €5 billion in cash by 2010. It needs the money to pay for the development of a new wide-body plane, the A350, to challenge Boeing's 787 Dreamliner.
Competition between the two aeronautics giants is raging. Since 1999, Airbus had succeeded in overtaking its American rival, but in 2006, as the European company struggled to deal with internal issues, Boeing caught up again, booking considerably more orders for future delivery.
France, on 1st March, said that it would provide €100 million in new financial support for Airbus, to fund the development of carbon-fiber composite technologies, essential for the construction of the new A350.
This risks exacerbating the conflict with the US – with whom the EU is already engaged in a battle at the WTO over allegations of illegal subsidies. Indeed, the US has warned the EU as well as the four countries involved in Airbus that any government- spending on the A350 would violate international rules (EurActiv 16/11/06).



