European buyers have given their formal backing to a â‚¬3.5billion (£3.1bn) rescue deal for the troubled Airbus A400M at a signing yesterday.
The bailout from seven NATO nations is the result of a roller-coaster political battle to prevent Europe’s largest single defence project from collapsing under the weight of cost overruns and delays with the loss of 10,000 jobs.
Since the deal was first agreed in March 2010, Europe has been sucked into a growing budget crisis and the bailout was threatened by new objections from the British coalition government, amid sharp defence spending cuts.
Turkey also put forward last-minute demands as delegates tried to turn the tentative agreement into a legal contract.
The confirmation will come as a relief to for staff working on the A400M at the Airbus plant in Filton where the wings and the landing gear for the plane are built.
But technical problems and mismanagement kicked the project four years behind schedule and â‚¬7.6bn over budget.
Under the rescue plan, the seven key buyers agreed to a â‚¬2bn increase in the total price of the transport planes. Part of this will be financed by taking fewer aircraft for the same price, reducing the total order to 170 from 180.
Germany has cut its order by seven planes to 53 and Britain will take 22 planes instead of the 25 initially ordered.
Airbus’s next priority will be to try to win back South Africa as an export customer after the country cancelled an A400M purchase.