The company has signed a Declaration of Intent with the A400M Launch Customer Nations defining the framework for achieving a mutually binding contract amendment later in the year.
Airbus has signed a Declaration of Intent (DoI) with the A400M Launch Customer Nations (Germany, France, United Kingdom, Spain, Turkey, Belgium, Luxemburg) defining the framework for achieving a mutually binding contract amendment later in the year.
Airbus, European defence agency OCCAR and the Customer Nations have agreed to work on a number of contractual elements including a revamped delivery plan as well as a roadmap for the development and completion of military capabilities for the A400M.
Continuing problems with the European airlifter overshadowed the group's results last year, as it took a further charge of €2.2bn on the programme, on top of the €841m booked over the two preceding years. CEO Thomas Enders said that de-risking the A400M programme was a top priority for the coming year.
In an attempt to limit the financial damage, the company has been seeking to renegotiate existing contracts with government customers.
Airbus says the DoI is an important step towards reaching a contractually binding agreement with OCCAR and the Launch Customer Nations in 2018 to mitigate risks and to ensure the future of the programme. OCCAR is managing the A400M programme on behalf of the seven Launch Customer Nations.
CEO Tom Enders has repeatedly underlined that the programme has suffered above all from a flawed contractual set-up and insufficient budget. He says the company now has a good chance “to stop or at least reduce the bleeding”.
An increase to the Loss Making Contract provision on the programme, which may be material, is under assessment for the Full Year 2017 results which will be disclosed on 15th February. According to Airbus, with a clear roadmap in place, the remaining exposure going forward would be more limited.