Airbus Targets A400M Military Airlifter Sales Push at Paris Show

Airbus SAS plans to use next month’s Paris air show to bolster export prospects for its A400 military cargo plane as it rushes to meet a mid-year deadline to deliver the first model to the French air force.

“Le Bourget is going to be a break-out point for exports,” Domingo Urena-Raso, the Airbus Military chief executive officer, said in an interview, referring to the airport north of Paris where the aerospace industry will gather starting June 17. With the A400M now entering service, new customers will have greater confidence in the product, he said.

Export campaigns are critical for Airbus to make money on the plane that is unprofitable with the 174 existing orders after technical issues delayed the program by years and increased costs. Malaysia so far is the only export buyer for the turbo-propeller plane being built for Germany, France, Spain, the U.K., Turkey, Belgium and Luxembourg.

“Winning exports this year is not reasonable, but why not next year,” Urena-Raso said by telephone. “I will maintain the pressure to get that.”

Two A400Ms are scheduled to be at the Paris show, with one participating in the daily flight display for the first time after an engine glitch grounded the plane during the event two years ago. Demonstration flights in potential export markets could take place before year end, Urena-Raso said.

Procurement authorities in France are finalizing acceptance of the first A400M before July after Airbus last year once again delayed the handover. A delivery ceremony at the Paris show would be an artificial deadline, Urena-Raso said.

First Handovers

Airbus plans to hand over four A400Ms this year, including to the Turkish air force, ten next year and 21 in 2015.

Exports campaigns are also in process for the company’s A330 airliner-based multi-role tanker transport. Airbus is bidding on a contract from Singapore as it seeks a replacement for Boeing Co. (BA) KC-135 refueling planes, Urena-Raso said.

Discussions also continue to finalize a contract in India where Airbus was named preferred bidder in January.

Airbus Military plans to deliver six A330 tankers this year, three to the U.K. under the Future Strategic Tanker Aircraft project, one more to the United Arab Emirates, and two to Saudi Arabia. The U.K. has begun operating its FSTA planes to carry troops and Urena-Raso said approval to start refueling operations could come this month.

France also plans to buy refueling planes and signaled in a new defense strategy released April 29 it may limit the purchase to 12 aircraft from 14 as part of a broader reduction in equipment spending. Urena-Raso said it is to early to draw conclusions over France’s intentions, and that the real the test will be the formal military budget plan due late this year.

To contact the reporter on this story: Robert Wall in London at rwall6@bloomberg.net

To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net

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