Take-off three years late for giant plane – and the cost is soaring too

Published on Friday 11 December 2009 21:42

THE A400M military transport plane which has been causing Airbus and European defence ministers budgetary and logistical headaches finally took to the skies for its maiden flight yesterday.

But even as the hulking giant took off from the Spanish city of Seville, defence officials met to decide how to continue with the much-delayed and over-budget project.

The A400M programme was launched six years ago with an order for 180 planes from seven governments – the UK, Belgium, France, Germany, Luxembourg, Spain and Turkey. The project is running at least three years late.

The original price was 20 billion (18 billion), but a preliminary report by auditors PricewaterhouseCoopers said EADS, the owner of Airbus, might need an extra 4.5 billion – inflating the final bill by 25 per cent, a source close to the talks said.

Airbus chief executive Tom Enders declined to talk about the A400M's funding gap yesterday, saying: "There are ongoing negotiations. I hope we can conclude them in the weeks ahead."

Yesterday's flight tested the landing gear and the flaps. It marks the beginning of a three-year flight test programme.

EADS has asked governments to renegotiate the initial contract, which was agreed along the lines of Airbus's standard fixed-price commercial contracts, rather than a risk-sharing military deal.

Mr Enders has attacked the contract agreed by his predecessor, which saddles the planemaker with most of the costs of delays. But asking governments to pay more has become difficult at a time when countries' budgets have ballooned as they fight off the worst of the economic crisis.