http://www.nytimes.com/2006/10/09/bu...rtner=homepage
October 9, 2006
C.E.O. Resigns in Latest Upheaval at Airbus
By MARK LANDLER and NICOLA CLARK
FRANKFURT, Germany, Oct. 9 — When Christian Streiff took over as chief executive of Airbus after a boardroom purge in July, he described his first days at the embattled European planemaker as a “vertical takeoff” with “full thrust.” Three months later, Mr. Streiff’s ride has ended after an equally swift nosedive.
The European Aeronautic Defense and Space Company, the corporate parent of Airbus, said today that he had resigned and would be replaced by one of EADS’s co-chief executives, Louis Gallois.
The shakeup came after Mr. Streiff, 52, clashed bitterly with EADS over how much autonomy he had to overhaul Airbus, which has been beset by manufacturing chaos and delays in its flagship new aircraft, the A380.
Mr. Streiff demanded considerable freedom to impose 2 billion euros ($2.5 billion) a year in cost cuts at Airbus. But EADS has been determined to assert its control over Airbus since last June, when it was caught off guard by costly delays in the production of the A380.
“We said Airbus would be integrated more closely into the EADS group,” said Christian Poppe, the head of communications at EADS in Munich. “He would have been aware of that when he took the job. Obviously, he didn’t pay too much attention to this political orientation.”
A spokeswoman for Airbus, Barbara Kracht, declined to comment, saying the matter was a decision of the board of EADS.
(Born of a merger principally between French and German aerospace companies in the late 1990’s, EADS always has two co-chief executives, one of them French — Mr. Gallois — and the other German, Thomas Enders.)
The choice of Mr. Gallois to take over Airbus clarifies the tangled management of the company somewhat. An industrialist who once ran the French national railway, Mr. Gallois will keep his title at EADS and be responsible for commercial aircraft. Mr. Enders, who used to oversee Airbus, will also continue as co-chief of EADS, and take charge of its military businesses. Still, analysts say, the latest shakeup will magnify the doubts that have coalesced around Airbus, which has been in more or less continual turmoil since the production of the A380 went off-track earlier this year.
“Streiff was making drastic changes in production arrangements,” said Richard Aboulafia, an aerospace analyst at the Teal Group in Fairfax, Va., “His ability to do this was a step in the right direction.”
Mr. Gallois is expected to retain the broad outlines of Mr. Streiff’s plan, which was approved by EADS on Oct. 3. But executives at Airbus said they expected the pace of change to be slower after the departure of Mr. Streiff, a hard-charging executive who came from the glass-making firm Saint Gobain.
Some of Mr. Streiff’s bolder ideas — such as moving some production of the A380 from Hamburg, Germany, to Toulouse in southwest France — collided with political interests in Germany, which, along with France, is the primary state backer of this grand European industrial project.
On Monday, the German finance minister, Peer Steinbrück, told reporters, “It’s important to us that German factories be treated equally, in view of the current difficulties.”
Mr. Poppe said Mr. Gallois would fill in the details of Mr. Streiff’s plan, which is called Power8, and would make another presentation to the board of EADS, probably early next year. He said it was too soon to speculate about whether Airbus would shut plants or shift production around Europe.
The announcement late today capped three frenzied days of negotiations, during which Mr. Streiff submitted and then withdrew at least one letter of resignation, according to executives.
Following a weekend of reports and denials that his departure was imminent, he won a late endorsement on Sunday evening from the French prime minister, Dominique de Villepin, who said in a televised interview, “He is doing a formidable job, and there is no reason for Christian Streiff’s resignation.”
But Mr. Streiff had lost the confidence of Mr. Enders and of the major German shareholder in EADS, DaimlerChrysler.
“He was saying, ‘I’ll come to Munich three times a year and present my case, but otherwise, I want to be left completely alone,’ ” said an executive at DaimlerChrysler, referring to the German headquarters of EADS in Munich. “People thought it was really strange.”
Among the challenges facing Mr. Gallois will be securing orders for the A380, which is two years behind schedule.
Executives at Airbus said John J. Leahy, the chief commercial officer, just completed a tour of airlines that have already ordered the plane. While none cancelled or cut back their orders, the prospect of more turmoil at Airbus could cause them to rethink their willingness to stick with the company.
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my thoughts, seems that Airbus is really falling apart, I guess the big plane they are trying to make is going to sink the ship?
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