EADS Internal Battle Exacerbated by Defense Industry Requirements (updated)

You want scary this Halloween? Well, you could be managing EADS. DID has discussed Airbus’ difficulties before, mostly in the context of BAE’s divestiture and likely investments in the defense field. A related corporate issue also feeds back into the defense sector, however; it concerns the balance of French and German representation within Airbus and EADS, and related political pressures from interested governments.

Of course, Halloween eventually ends, and it would appear that EADS has now resolved the issue…

The problem as explained by Defense Aerospace’s Giovanni de Briganti was this:

EADS shareholders recently agreed in principle to appoint Eurocopter CEO Fabrice Bregier as Airbus COO and deputy to fellow Frenchman and EADS co-CEO Louis Gallois, who also took over as Airbus CEO in July 2006. An announcement was expected on Oct. 20 or early this week, but it has not been made. The problem is that the German government, which has significant influence over EADS, sees the moves as a French power grab. The natural political response is to appoint other German executives within EADS to mollify the German government. Unfortunately, there are few to no senior positions available – and the reason has to do with agreements and regulations related to its defense subsidiaries.

On October 31, however, EADS finally put out the awaited announcement.

Fabrice Bregier was officially as Airbus Chief Operating Officer (COO), EADS CFO Hans Peter Ring was appointed as Airbus CFO effective January 1, 2007 and will remain CFO of EADS, and Lutz Bertling has been appointed to succeed Fabrice Bregier as President and CEO of Eurocopter and to join the EADS Executive Committee. He will report to EADS CEO Tom Enders.

Airbus’ current CFO Andreas Sperl will “move to another operational function within the EADS Group.”