| Airbus was incorporated in 2001 under French | | | | delivery of its A380. In the wake of the |
| law as a simplified joint stock company or | | | | announcement, the value of associated stock |
| S.A.S. (Société par Actions | | | | plunged by up to a quarter in a matter of |
| Simplifiée). Airbus was formerly known as | | | | days, although it soon recovered somewhat. |
| Airbus Industrie. | | | | Allegations of insider trading on the part of |
| | | | Noël Forgeard, CEO of EADS, its majority |
| Airbus was jointly held by EADS (80%) and BAE | | | | corporate parent, promptly followed. The loss |
| Systems (20%), Europe's two largest defence | | | | of associated value caused great concern on |
| contractors. BAE Systems announced its | | | | the part of BAE, The Independent describing a |
| intention to sell its 20% share of Airbus in | | | | "furious row" between BAE and EADS, with BAE |
| April 2006 and exercised its "put option" in | | | | believing the announcement was designed to |
| June 2006 to force EADS to buy the share. The | | | | depress the value of its share. A French |
| put option appointed investment bank | | | | shareholder group filed a class action |
| Rothschild to establish an independent | | | | lawsuit against EADS in a Dutch court for |
| valuation. Rothschild's valuation, reported | | | | failing to inform investors of the financial |
| in 2006, was L1.9 billion (€2.75 | | | | implications of the A380 delays while |
| billion), well below the expecations of BAE | | | | airlines to which deliveries were promised |
| and EADS. Unhappy with the valuation, BAE | | | | are expected to demand compensation. As a |
| appointed independent auditors to investigate | | | | result, EADS chief Noël Forgeard and |
| the value of its 20% share. On 6 September | | | | Airbus CEO Gustav Humbert announced their |
| 2006 the BAE board announced it would | | | | resignations on 2 July 2006. Forgeard's |
| recommend to shareholders to sell its share | | | | severance package is expected to include |
| for €2.75bn (L1.87bn or $3.53bn). | | | | three years' of salary plus the 2005 bonus; a |
| | | | total of at least €6 million, possibly |
| Airbus employs around 57,000 people at | | | | topping €7 million. |
| sixteen sites in four European countries: | | | | |
| Germany, France, the United Kingdom, and | | | | On July 2nd 2006 Rothschild valued BAE's |
| Spain. Final assembly production occurs at | | | | stake at L1.9 billion (€2.75 billion); |
| Toulouse (France) and Hamburg (Germany). | | | | well below the expectation of BAE, analysts |
| Airbus also has three subsidiaries in the | | | | and even EADS. On 5 July 2006 BAE appointed |
| USA, Japan and China. | | | | independent auditors to study why the value |
| | | | of its share of Airbus had fallen from the |
| Airbus Industrie was formally set up in 1970 | | | | original estimates to the Rothschild |
| following an agreement between Sud-Aviation | | | | valuation. The pushed back any potential sale |
| (France) and Deutsche Airbus—itself a | | | | until September at the earliest. [11] On 6 |
| German aerospace consortium consisting of | | | | September 2006 BAE agreed to sell its stake |
| Bölkow, Dornier, Flugzeug-Union Süd, | | | | in Airbus to EADS for L1.87 billion |
| HFB, Messerschmitt, TG Siebelwerke, and VFW. | | | | (€2.75 billion, $3.53 billion), pending |
| The grouping was joined by CASA of Spain in | | | | BAE shareholder approval. On 4 October |
| 1971. Each company would deliver its sections | | | | shareholders voted in favour of the sale. |
| as fully equipped, ready to fly items. The | | | | |
| name "Airbus" was taken from a | | | | On the 9th October 2006 Christian Streiff, |
| non-proprietary term used by the airline | | | | Humbert's successor, resigned due to |
| industry in the 1960s to refer to a | | | | differences with parent company EADS over the |
| commercial aircraft of a certain size and | | | | amount of independence he would be granted in |
| range, for this term was acceptable to the | | | | implementing his reorganization plan for |
| French linguistically. | | | | Airbus. He will be succeeded by EADS co-CEO |
| | | | Louis Gallois. This brings Airbus under more |
| In 1972 the A300 made its maiden flight and | | | | direct control of its parent company. |
| the first production model, the A300B2 | | | | |
| entered service in 1974. Initially the | | | | Civilian products |
| success of the consortium was poor but by | | | | |
| 1979 there were 81 aircraft in service. It | | | | The Airbus product line started with the |
| was the launch of the A320 in 1981 that | | | | A300, the world's first twin-aisle, |
| guaranteed Airbus as a major player in the | | | | twin-engined aircraft. A shorter, re-winged, |
| aircraft market - the aircraft had over 400 | | | | re-engined variant of the A300 is known as |
| orders before it first flew, compared to 15 | | | | the A310. Building on its success, Airbus |
| for the A300 in 1972. | | | | launched the A320 with its innovative |
| | | | fly-by-wire control system. The A320 has |
| It was a fairly loose alliance but that | | | | been, and continues to be, a great commercial |
| changed shortly after major defence mergers | | | | success. The A318 and A319 are shorter |
| in 2000. DaimlerChrysler Aerospace (successor | | | | derivatives with some of the latter under |
| to Deutsche Airbus), Aérospatiale | | | | construction for the corporate biz-jet market |
| (successor to Sud-Aviation) and CASA merged | | | | (Airbus Corporate Jet). A stretched version |
| to form EADS. In 2001 BAE Systems (formerly | | | | is known as the A321 and is proving |
| British Aerospace) and EADS formed the Airbus | | | | competitive with later models of the Boeing |
| Integrated Company to coincide with the | | | | 737. |
| development of the new Airbus A380 which will | | | | |
| seat 555 passengers and be the world's | | | | The longer range products, the twin-jet A330 |
| largest commercial passenger jet when it | | | | and the four-engine A340, have efficient |
| enters service in late 2007 according to the | | | | wings, enhanced by winglets. The Airbus |
| revised schedule announced in October of | | | | A340-500 has an operating range of 16 700 |
| 2006. | | | | kilometres (9000 nautical miles), the second |
| | | | longest range of any commercial jet after the |
| BAE sale and A380 controversy | | | | Boeing 777-200LR (range of 17 446 km or 9420 |
| | | | nautical miles). The company is particularly |
| On April 6th 2006 BBC News reported that BAE | | | | proud of its use of fly-by-wire technologies |
| Systems was selling its share, then | | | | and the common cockpit and systems in use |
| "conservatively valued" at €3.5 billion | | | | throughout the aircraft family, which make it |
| EUR ($4.17 bn USD). The move was seen by | | | | much easier to train crew. |
| many analysts as a move to make partnerships | | | | |
| with U.S. firms more feasible, in both | | | | Airbus is studying a replacement for the A320 |
| financial and political terms. BAE originally | | | | series, tentatively dubbed NSR, for "New |
| sought to agree a price with EADS through an | | | | Short-Range aircraft." |
| informal process. However due to the slow | | | | |
| pace of negotiations and disagreements over | | | | In March 2006 Airbus announced the closing of |
| price, BAE exercised its put option which saw | | | | the A300/A310 production line, ending over 30 |
| investment bank Rothschild appointed to give | | | | years of production. The last delivery will |
| an independent valuation. | | | | take place in 2nd quarter 2007. |
| | | | |
| In June, 2006, Airbus became embroiled in a | | | | Until its retirement in 2003, Airbus supplied |
| significant international controversy over | | | | replacement parts and service for the |
| its announcement of a further delay in the | | | | Concorde. |