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Airbus Group to merge with planemaking unit
September 30, 2016 / 6:28 AM / a year ago

Airbus Group to merge with planemaking unit

PARIS (Reuters) - Airbus Group (AIR.PA) said on Friday it would merge with its planemaking unit, strip out bureaucracy and simplify its brand, marking a break with its complex corporate roots as it prepares for tougher expected competition.

A flight test engineer holds an Airbus Group flag after the first flight of the Airbus A320neo (New Engine Option) in Colomiers near Toulouse, France, September 25, 2014. REUTERS/Regis Duvignau/File Photo

Europe’s largest aerospace group will be renamed “Airbus” after its core planemaking brand under the shake-up, the latest piece of corporate tinkering since it emerged from a cluster of French, German and Spanish aerospace interests in 2000.

Airbus confirmed the promotion of Fabrice Bregier to the new role of chief operating officer for the whole group, with overall responsibility for reshaping digital operations as well as for the global supply chain and quality.

He will continue to carry out his existing job in charge of the planemaking business, renamed Airbus Commercial Aircraft.

“We are bringing Team Airbus closer together, recognising that our commercial aircraft division is by far the largest contributor to our company’s revenues and financials,” Chief Executive Tom Enders said in a statement.

The company curbed the influence of French and German governments in 2013 and adopted its best-known jetmaking brand a year later by renaming itself Airbus Group, but left in place an overlapping structure and confusion over which Airbus was which.

People familiar with the plans said earlier that this distinction would now disappear as the vehicle for the original merger, known as Airbus Group SAS, and the planemaker, Airbus SAS, merge into a single company based in Toulouse under a sole chief executive, German-born Enders.

Both are currently subsidiaries of the listed entity, Airbus Group SE, which is based in the Netherlands.

Enders has promised to bring new digital thinking into production, development and support to speed decision-making and prepare for future competition across the group’s products which range from aircraft to satellites and defence systems.

He told staff in a letter last week the changes would result in consolidation and cost-reductions at the top of the company.

    French labour unions ranging from Force Ouvriere to the CGT, CFDT and CFE-CGC said they feared possible job cuts.

    Force Ouvriere said in a statement it would “watch all the components of this restructuring, notably its social impact”

    CGT official Xavier Petrachi told Reuters: “We do not know yet the scope of this restructuring. Will it be limited to the support functions of Airbus Group and of Airbus SAS or will it impact the structures of Airbus Operations and entities of the helicopters and defence and space units ?”

    The heads of the company’s two other divisions, helicopters boss Guillaume Faury and defence and space chief Dirk Hoke, are expected to assume additional group-wide roles to help drive through Enders’ so-called “digital transformation” project.

    The company said these units would benefit from reduced costs due to the internal merger, which will take effect in January. It did not provide any financial details.

    Reporting by Tim Hepher, additional reporting Johanna Decorse; Editing by Victoria Bryan, Greg Mahlich

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