Jan. 31 (Bloomberg) -- Airbus SAS, the world's biggest planemaker, may eliminate as many as 8,000 production jobs in Germany after delays in the A380 superjumbo slashed earnings, union officials said.

The Toulouse, France-based planemaker may sell manufacturing sites, buy more parts from outside suppliers and move work now done in Germany to France, Horst Niehus, a works council leader at the company's Hamburg factory, told union members in a memo.

``Should all scenarios be realized, it is expected that 5,000 through 8,000 jobs will be lost at Airbus Deutschland and 2,500 through 4,000 at Hamburg,'' Niehus said in the memo dated Jan. 29.

Airbus plans to slash 2.1 billion euros ($2.7 billion) from annual costs by 2010 as it tries to pay for development of another new plane, the A350, to compete with Boeing Co.'s 787 Dreamliner. Airbus parent European Aeronautic, Defence & Space Co. said Jan. 17 that the planemaker will record its first full-year loss ever for 2006 because of cost overruns on 555-seat A380, which is at least two years behind schedule.

``There's going to be pain, and it's probably going to take various forms,'' said Sandy Morris, an analyst at ABN Amro in London who has a ``sell'' rating on the shares. ``But I don't see any reason why German sites would get worse hit than those in France. It may simply come earlier in Germany.''

Shares Decline

Shares of EADS rose 21 cents, or 0.8 percent, to 25.46 euros in Paris. The stock has lost 21 percent over the last 12 months compared with a 31 percent gain for Chicago-based Boeing.

``Nothing is decided and we don't comment on speculation,'' said Barbara Kracht, an Airbus spokewoman based in Toulouse.

Chief Executive Officer Louis Gallois will present the proposed cuts to the works council on Feb. 20, Niehus said. The union, which is planning protest demonstrations in Germany on Feb. 2, already has internal company information suggesting ``serious repercussions.''

Daniel Friedrich, a spokesman for IG Metall, confirmed the contents of the Niehus memo sent to Airbus employees in Germany. IG Metall, the union representing Airbus's German workers, expects about 10,000 employees to take part in the demonstrations.

The works council will meet today with German Economy Minister Michael Glos to discuss the situation, the minister said at a Berlin briefing.

Political Intervention

``I will do everything to call on the French partner and those who run Airbus to make sure that any job cuts will be in both countries and not to the disadvantage of German sites,'' Glos said. ``I will listen to the worries and help wherever I can within a government framework.''

Boeing, the world's only other maker of large commercial planes, today reported fourth-quarter profit more than doubled after aircraft deliveries surpassed company forecasts. Net income climbed to $989 million from $460 million a year earlier.

Boeing beat Airbus in the dollar value of commercial orders and deliveries last year for the first time since 2001. Boeing now says it will take the lead in aircraft deliveries worldwide by 2008, partly helped by the success of the midsized, long-range 787 model. It has sold 448 Dreamliners to date compared with about 100 sales for Airbus on its A350 XWB.

The meetings on Feb. 2 for Airbus's German workers are meant to provide employees with information about the situation as well as make management ``consider their reorganization plans carefully,'' Friedrich said.

Moving Work

Among potential cost-cutting measures are moving all cabin work on the A380 to Toulouse from Hamburg; moving cabin interior furnishings work on the single-aisle A320 to Toulouse from Hamburg; and a decision to give Hamburg no work on building fuselages or installing equipment on the A350, the new plane scheduled to enter service in 2013.

Germany currently employs 19,000 people at seven sites in Germany. Hamburg, where Airbus assembles the single-aisle A319, A318, and A321 planes, has 11,000 employees, making it the world's third-largest aerospace site after Toulouse and Seattle, where Boeing builds its planes.

Other German sites include Bremen, with 3,300 workers, which makes landing flaps, slats and spoilers; Nordenham, with 2,300 employees, making fuselage shells; Laupheim, which specializes in cabin and cargo customization; Stade, where vertical tail fins are made; Varel, which makes highly complex components; and Buxtehude, specializing in production of electronic aircraft cabin systems.

Airbus Loss

Airbus parent EADS said Jan. 17 that charges for penalty payments to customers because of A380 delays, writedown of assets and the cost of a reorganization plan will be taken in 2006 instead of 2007 as expected, producing a loss before interest and tax at Airbus. EADS will report earnings March 9. Airbus's Gallois has said he will publicize the details of Power8 cost-cutting plane by late February.

EADS also said Jan. 17 that it may take additional charges tied to the two-year slip in deliveries of the A380 superjumbo, which cost at least $13.5 billion to develop. The delays have prompted demands from airlines for compensation. Distracted by the A380, Airbus failed to quickly produce a rival plane to Boeing's 787.

Gallois is Airbus's third chief executive in 19 months. His predecessor, Christian Streiff, spent only three months on the job. It was Streiff who first unveiled the Power8 cost-cutting plan on Oct. 3. He quit a week later after the pace of his proposed reorganization and his style in pushing it upset politicians and Airbus's parent EADS.

To contact the reporter on this story: Andrea Rothman in Toulouse, France at aerothman@bloomberg.net

Last Updated: January 31, 2007 12:23 EST