EADS vows to limit redundancies in jobs cull

Paris (AFP) - European aerospace giant EADS vowed Tuesday to limit the number of redundancies in a programme of sweeping job cuts it insists are essential for its future survival.

"We have to act now," said EADS chief executive Tom Enders, defending a decision unveiled a day earlier to slash 5,800 jobs across the group over the next three years.

The cuts will be shared equally across EADS's aerospace and defence activities.

Military orders were down and international competition on emerging markets was becoming increasingly fierce, Enders argued.

"Inaction would be irresponsible and would result in a far more severe situation for our employees and for the performance of the company just a couple of years down the road," he told a telephone news conference.

EADS human resources director Thierry Barril said that 1,300 temporary contracts would not be renewed in 2014.

In addition, 500 positions would be scrapped in the group's central functions.

On top of this, around 2,000 jobs would be axed in Germany, 1,260 in France, 557 in Spain, 450 in Britain and 180 in the rest of the world.

After transfers within the group, early retirement programmes and voluntary redundancies, EADS management is pencilling in 1,000-1,450 forced layoffs.

EADS' strategy chief Marwan Lahoud said some 700 forced redundancies could be made in Germany, and 300 in France.

But Enders said it was too early to say exactly what the final number will be.

Management will start talks with unions to explore ways of limiting the layoffs, such as modifying working hours, Barril said.

Lahoud said EADS would discuss the changes with unions in order to reduce forced redundancies.

"If we don't have agreements by mid-2014 we'll be forced to go ahead with redundancies," he said.

French Labour Minister Michel Sapin insisted job cuts at profit-making EADS were "not acceptable" while Industrial Renewal Minister Arnaud Montebourg called for transfers, voluntary departure or retirement packages only.

In Berlin, the German economy ministry urged caution in implementing the job cuts and said EADS must remain even-handed in spreading them across the group.

"We call on the aerospace group to implement the planned cuts as cautiously and in a way that is as socially acceptable as possible," the ministry wrote.

And it added: "We assume that the cuts will not be one-sided to the detriment of the German sites. The aim must be to make it as transparent to the workforce as possible what awaits them."

"Very relaxed about political reactions"

CEO Enders said all of the governments -- in Madrid, Paris, London and Berlin -- had been forewarned about the cuts and that he felt "very relaxed about the political reactions."

Unions -- IG Metall in Germany and Force Ouvriere in France -- slammed the plans which they said were dictated solely by financial considerations.

"We heard the same criticism" -- of greed, of chasing profits and jeopardising the company's future -- seven years ago when plane-maker Airbus was restructured, Enders countered.

Back then, a less-than-planned 7,900 jobs were axed and the programme was a success, he insisted.

Under the new shake-up, the aerospace and defence divisions Astrium and Cassidian will be merged with the military transport activities of Airbus to form a single unit Airbus Defense and Space.

The head of the new division, Bernhard Gerwert, said that 2,470 posts would be axed in aerospace and 2,830 in defence.

"This business is not competitive at all," Gerwert said, noting that US group SpaceX offered placing satellites into orbit for 30 percent less than Europe's Ariane.

Management has not yet drawn up a list of sites that will be closed.

Enders pointed out that all defence groups are currently undergoing restructuring.

And if EADS had merged with British defence firm BAE Systems a year ago, "we would have had less reduction of positions than on a stand alone position," he said.

It was primarily the objections of Germany which forced the EADS-BAE merger to be abandoned, because Berlin feared the tie-up would cost jobs.