Nov. 5 (Bloomberg) -- Airbus SAS lost an order from South Africa for eight units of its A400M military transporter, leaving the company with only one remaining export contract.

South Africa scrapped plans to buy the airlifters after production glitches and exchange rate fluctuations increased the purchase price from 837 million euros ($1.2 billion), or 6.4 billion rand, in 2004 to 40 billion rand today, government spokesman Themba Maseko told reporters in Cape Town.

The cancellation leaves Airbus with a Malaysian order for four aircraft as the sole export deal on the A400M. The project’s seven partner nations have placed 180 orders for the transporter, which is four years behind schedule, mainly because of problems developing the engine. South Africa had sought the plane for peacekeeping missions in the rest of Africa.

Germany, France, Spain, the U.K. and three other nations commissioned a 20 billion-euro order in 2003. For South Africa, the deal would have placed an “unbearable burden” on taxpayers, Maseko told reporters today.

“The termination is due to extensive cost escalation and the supplier’s failure to deliver the aircraft within the stipulated timeframe,” he said.

European Aeronautic, Defence & Space Co., Airbus’s parent company, fell as much as 23 cents, or 1.7 percent, to 12.98 euros and traded at 13.16 euros as of 14:02 p.m. in Paris, giving the company a market value of 10.7 billion euros.

“Airbus Military is surprised by the announcement of the Government of South Africa to cancel the order,” the company said in a release. “It very much regrets such an announcement, especially at a time where the program is making very good progress towards first flight before the end of the year.”

Airbus has completed trials on a test bed of the engine that will power its military transporter and will now move on to other tasks before a first flight of the plane by as early as December in Seville, Spain, where the plane is being assembled, the company said in October.

Airbus in July won an extension until the end of this year to renegotiate with the governments that ordered the plane. The original contract gave purchasers the right to back out if the first test flight didn’t take place by April 2009.

To contact the reporters on this story: Mike Cohen in Cape Town at mcohen21@bloomberg.net

Last Updated: November 5, 2009 08:06 EST