Post on 01-May-2018
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Global Investor Forum 2008
A400MCarlos SuarezCEOMTAD & Airbus Military
Tom WilliamsExecutive Vice-President ProgrammesAirbus
Seville, 17th / 18th January 2008
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The Company disclaims any intention or obligation to update these forward-looking statements. Consequently the Company isnot responsible for any consequences from using any of the below statements.
Certain of the statements contained in this document are not historical facts but rather are statements of future expectations and otherforward-looking statements that are based on management‘s beliefs. These statements reflect the Company‘s views and assumptionsas of the date of the statements and involve known and unknown risk and uncertainties that could cause actual results, performance orevents to differ materially from those expressed or implied in such statements.
When used in this document, words such as “anticipate” , “believe”, “estimate”, “expect”, “may”, “intend”, “plan to” and “project” areintended to identify forward-looking statements. Such forward-looking statements include, without limitation, projections forimprovements in process and operations, new business opportunities, revenues and revenues growth, operating margin growth, cashflow, deliveries, launches, compliance with delivery schedules, performance against Company targets, new products, current andfuture markets for the Company products and other trend projections.
This forward looking information is based upon a number of assumptions including without limitation:· Assumption regarding demand· Current and future markets for the Company‘s products and services· Internal performance including the ability to successfully integrate EADS‘ activities to control costs and maintain quality· Customer financing· Customer, supplier and subcontractor performance or contract negotiations· Favourable outcomes of certain pending sales campaigns
Forward looking statements are subject to uncertainty and actual future results and trends may differ materially depending on varietyof factors including without limitation:· General economic and labour conditions, including in particular economic conditions in Europe and North America,· Legal, financial and governmental risk related to international transactions· The cyclical nature of some of the Company‘s businesses· Volatility of the market for certain products and services· Product performance risks, and programme development and management risks· Collective bargaining labour disputes· Factors that result in significant and prolonged disruption to air travel world-wide· The outcome of political and legal processes, including uncertainty regarding government funding of certain programs· Consolidation among competitors in the aerospace industry· The cost of developing, and the commercial success of new products· Exchange rate and interest rate spread fluctuations between the Euro and the U.S. dollar and other currencies· Legal proceeding and other economic, political and technological risk and uncertainties
Additional information regarding these factors is contained in the Company‘s “registration document” dated 25th April 2007
Safe Harbor Statement
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Background
• Long lasting sales campaign dating from FLA.• Launch date came out at the worst point for Airbus.• Lack of non specific design activity in previous Airbus
partners. • Multi mission role leads to a complex set of requirements.• Lack of experience in Airbus for High Wing, “T” tail, turbo
prop aircraft and military qualification.• Strong pressure from Nations to adopt the EPI engine as
opposed to the cheaper and less risky PW solution for the most powerful engine propeller combination ever developed.
• Fixed Price Contract (“Commercial Approach”) with unbalanced Risk taking.
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Programme execution
• Complex work share• Still using the NatCo based development teams.• Better integration of design tools and PDM.• Significant early changes in aircraft configuration.• IFA represents a major stretch for the local team (a mini
FAL), they were not sufficiently supported by the Airbus organisation.
• EPI not organised as a proper programme management organisation.
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Key challenges for 2008
• Recover the engine delays.
• Manage the outstanding work (particularly the cargo handling system, …).
• React to the issues coming from first flight.
• Manage the military equipment development.
• Manage the ramp up.
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Supporting actions
• New leadership for the programme.
• New programme organisation in EPI. Audit launched with EPI.
• Stronger support at Bremen through the new integrated CoE fuselage.
• High level focus through weekly reviews with CEO.
• Stronger coordination between Airbus, MTAD (Airbus Military) and DS
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TP400-D6 Engine Development Milestones
TODAY’S
STATUS
CONTRACTUAL DATE
30 Oct. 2007
N.A.
30 Oct. 2007
30 Jan. 2007
30 Jun. 2007
30 Nov. 2006
30 Dec. 2005
30 Aug. 2005
July 2008TP400 Engine First Flight Clearance
Oct. 2008 TP400 Certification Std. Engine Delivery (HPC redesign)
19 Nov. 2007 Engine Delivery for Flight Test Bed
April 2008Flight Test Bed First Flight
Mar. 2009TP400 Engine Certification
Feb. 2008Engine Delivery or First A400M Test Aircraft
23 Feb. 2006First Engine & Propeller Test
28 Oct. 2005First Engine Test
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0
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RU
NN
ING
HR
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ETPv03 (2-09-2005)ETP06.01(September 2007)
ACTUAL (7-01-2008)
ETP06.01 FTB Flight Clearance
ETP06.01 Initial Flight Clearance
ETP06.01
ETP03
ETP Status: Running Hours
684:58 hr
Engine Contract Milestone (M8) 1150 hours
• Approx. 1200hr are needed to build up maturity confidence before First Flight
• Current Flight Test Engine Standard will impose Flight Limitations and some test need to be repeated when final Engine Standard available (HPC redesign)
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First Flight Schedule
July August September October November December January February March April May June July August20082007
St50
St 60 Outstanding Work St 40 SGT
Outstanding Work & St 35
St 30
St 20
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FlightLineSt 25
St 72 St 70
45a
Empennage Join-up
Fuselage Join-up A/C Integration & Equipping
45b
Engine equipping
Software reloading
Weighing
Wing Join-up Wing Equipping & Test
Ready for First Flight
Ready for First Flight
Indoor Ground Tests
Outdoor Ground Tests
Painting
Software Loading
GT
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IOC Flight Testing
And EIS
SOC Flight Testing
Impact to EIS
Contract
Qtr 1
2008 2009 2010 2011
FF IOC/EIS SOC
IOC/EISFF
MSN1
2m
SOC Flight Test
6 months delay
6 months delay
Engine clearanceOSW completion
Systems Integration
Engine unknownsSystems development
Unknowns form Flight test
MMC/GADIRS/FMSintegration
Qtr 2 Qtr 3 Qtr 4 Qtr 1 Qtr 2 Qtr 3 Qtr 4 Qtr 1 Qtr 2 Qtr 3 Qtr 4 Qtr 1 Qtr 2 Qtr 3 Qtr 4
SOC
6 m risk to SOC
MMC/GADIRS/FMS integrationCHS/ADS development
Military Qualification
IOC Flight Test
6 m risk to IOC/EIS
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A400M Programme Organisation
Sub-Contracts
Third PartiesEngine
ManufacturerEngine
Manufacturer
PropellerManufacturer
PropellerManufacturer
...
ShareholderAgreements
Shareholders
IndustrialAgreements
Partners
LaunchContract
OCCAR
Organisation for JointArmaments cooperation
---------------Organisme Conjoint de Coopération
en matière d'Armement
MoU
N
A
T
I
O
N
S
Development
Management
Contract
MTAD
MTAD
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A400M Rapid Response: Logistic and Tactical
Tactical Capability
Logistic Capability: Payload / Range
… fills the logistic/tactical gap
Tactical Transports
C-130
Strategic AirliftersAn-124, C-17
A400M
… complements C-17 capability
… affordable
Proprietary Information
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An impressive Market Segment3130 Medium size transports in service, in storage and on order, early 2007
1630 C-130177 C-160
520 An-12 800 IL-76/78
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Market Requirement for A400M type transports
Europe
North America
Latin AmericaAfric
a
Middle EastAsia
Australasia
CIS+China
plus Deliveries to current A400M Customers (192 a/c)
050
100150200250300350400450
~1100 aircraft in 60 countries up to 2025
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Capacity Requirement A400M type transports
North America
~400
CIS, China ~320
Customers192
Export Potential:400 aircraft in56 countries
~ 1300 Deliveries 2006 – 2025+
New demand plus replacements translate into a worldwide need for some1300 deliveries of A400M type aircraft
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Export Potential : 400 aircraft in 56 countries
0102030405060708090
Asiaexcluding Current Customers, North America, CIS, China
Middle
East
Africa
Latin A
merica
Europe
Austra
lasia
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A400M Delivery Potential ~ 400 aircraft
North America
~400
CIS, China ~320
Customers192
Export Potential:400 aircraft in56 countries
Export Potential200
Other Transactions200
A400M Delivery Potential to Customer and Export Nations:
~ 400
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Strong Market Prospects
• A400M marketing efforts have achieved 192 orders before first flight.
• There is a strong market interest in the aircraft which will strengthen as soon as the first aircraft starts flying.
• Even assuming conservative assumptions the A400M should achieve 400 sales.
• HOWEVER this assumes no penetration into the USAF which represents a further 400 units requirement.
• Just half of this US market would enable the currently planned production rate (~30 aircraft/year) to be maintained for >15years
EADS is convinced that their confidence in the A400M programme will be vindicated.
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A400M Operational Capabilities
Notwithstanding the immediate challenges ahead the A400M will meet the demanding requirements of both operational and humanitarian missions because:
. . . capabilities which put the A400M into a class of its own.
• A400M provides true Logistic (Inter-Theatre) Airlift:
• High Cruise Speed, Long Range, Outsize Load Capacity
• A400M is a better Tactical Airlifter than current fleets:
• Greater Manouvrability…Softer Field Capability…Better Self-Protection
• A400M has a built-in Air-to-Air Refuelling capability:• Fast / high enough for fast-jets…plus slow / low enough for helicopters