Forecasting Hard Times, EADS Vows to Preserve R&D, Design
By PIERRE TRAN – As defense cuts loom in the big European defense countries, EADS’ priority is to preserve research and development capabilities and to maintain its design labs, said Hervé Guillou, chief executive of EADS Defense & Communications Systems.
The French government should also speed up the outsourcing of non-critical services as a means of freeing up cash for the state, Guillou said.
With Britain, Germany, Italy and Spain poised to cut or announcing reductions, EADS was preparing for hard times that would likely last some years.
“The important thing is to avoid a rupture in technological capability,” Guillou said at the Eurosatory land armaments show which opened June 14.
That break in capability had happened before, he said: when the French government cut spending on development of UAVs in the early 1990s as part of the peace dividend.
The French Army flew the CL 289 and Crecerelle tactical drones in the 1990s because they were already available, but the curtailing of R&D led to the present 10-year lag in UAV technology which France might not be able to make good, he said.
One way to mitigate the impending defense cuts in Europe would be to get countries to agree which national programs could be cut to avoid cancelling the same type of work, he said. That would help preserve competences at the European rather than national level, much as defense minister Hervé Morin called for in his opening speech earlier in the day.
France, meanwhile, could release cash by contracting out services to the private sector, such as Spain has done in professional mobile radios with Telefonica, and Finland with the Astrid program, a nationwide network based on the tetra radio communications system, he said.