NATO Countries Discussing Continuing Delays On A400M

(MoneyWatch)  The troubled multi-national A400M transport program continues to wait a decision from its customers on whether to continued development or end the development. EADS would be forced to pay back millions to the different nations as penalties related to the delays in delivering the aircraft. The decision has been delayed consistently through the year from March to June and now 31 July.

England facing large budget problems has been the most vocal in perhaps not pursuing the aircraft while France who is generally supportive of EADS also talked at times of ending things. Right now, though, it is France that is recommending the decision be postponed even longer. EADS believes that the first flight of the transport may occur before 1 January and France is asking that the customers wait until then. The flight test is almost three years late and deliveries were supposed to occur in 2009 but now will be 2012 or 2013 in the best case.

The delay will also give more opportunity to perhaps renegotiate the contract or at least allow EADS to get the aircraft flying. Like the U.S. the NATO countries involved in Afghanistan need lift from helicopters and aircraft like the A400M. If the delays continue for the program it might make more sense to end it and buy existing systems such as the C-130, C-17 or even Russian aircraft. The failure of this program will not only be a blow to military capabilities but also to the European defense industry as a whole as the A400M featured some advanced engines and software and it would be embarrassing. There is also the possibility of foriegn sales for the aircraft which would only help the price for the domestic customers.