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EADS takes global lead in aerospace and defence R&D

Amsterdam/Paris, 04 November 2003

* CEO, Philippe Camus, forecasts €2.3 billion investment in R&D in 2003
* Calls for greater commitment to defence R&D funding from European governments and increased transatlantic industrial cooperation and competition

EADS, the global number two in aerospace and defence, is committed to further strengthening its high level of research and development. In opening remarks at the 2003 EADS Technology Forum being staged at the company's Corporate Research Centre at Suresnes near Paris, Philippe Camus, CEO of EADS, showcased the role that innovation and R&D has played in the transformation of the company since its formation just three years ago in 2000. "The best companies will succeed only when they embrace a culture of continuous and all-encompassing innovation," he said. "This means a willingness to be daring in the application of advanced technology, design and engineering."

The annual seminar is being attended by over 100 participants, including 70 business and technology journalists from 15 countries around the world, and involves presentations on technological advances across all EADS's spheres of businesses in commercial aviation, helicopters, military aircraft, missiles, space and defence electronics. Mr. Camus drew attention to the financial nature of EADS's commitment, referring to the 17 percent of total revenues invested in R&D in 2002. He then forecast a total of €2.3 billion self-financed investment in R&D within EADS in 2003, which reaches a new peak for the company. The R&D investment of EADS is substantially higher than that of its closest competitors.

The EADS CEO listed the practical results of this investment in the form of the ground-breaking A380 programme in commercial aerospace, the growing commitment to developing the A400M military transport programme, air tankers and other multi-mission aircraft, the development of advanced standoff weapons, and also the company's strong focus on combining space-based systems with ground-based command centres to answer the need for sophisticated C4ISR (Command Control Communications Computers Intelligence Surveillance Reconnaissance) capabilities in modern warfare.

Daniel Deviller, the EADS Chief Technology Officer (CTO), explained: “From the €5 billion dedicated to R&D in the EADS group more than €450 million are being spent on mid- and long-term Research & Technology (R&T) projects providing innovation for existing and new products, services and cost-efficient processes in the EADS Divisions. In 2003, €85 million are being invested in more than 120 shared projects of the EADS R&T Network, which is focused on long-term strategic research projects and technologies for cross-Group applications.”

The CTO underlined that key elements of the portfolio are projects oriented toward EADS's role as system provider and integrator, EADS's plan to grow in the defence business and to optimise cost efficiency in processes that are part of the EADS value generation chain.

Looking at the broader context of governmental involvement in R&D, Mr. Camus noted the under-investment by European governments in defence R&D over the last decade. "This was perhaps understandable given that cold war threats had disappeared. But it is no longer satisfactory for the future. European governments must face up to their responsibility within the Western alliance to adequately fund advanced R&D," Mr. Camus stated. "This is not only indispensable for the European effort to strengthen its defence capabilities and contribution to NATO and EU missions. It is also a prerequisite for future competitiveness of the European defence industry."

Mr. Camus went on to endorse current efforts to establish a European Armament Military and Research Agency, stating that this agency would offer an integrated and thus more efficient approach to future research projects and stimulate crucial European investment in advanced defence technologies: "The creation of this agency is crucial to establishing a process for harmonising European requirements and procurement planning. Its very existence should make future large-scale defence and security procurement programmes in Europe more efficient, more timely and more cost-effective for the governments concerned."

He went on to stress that governments should support increased industrial cooperation across the Atlantic: "The Western allies should foster an environment in which transatlantic and other industrial partnerships can focus on delivering the most advanced systems in the most cost effective manner."
About EADS:

EADS is a global aerospace and defence company and is the world's second largest in terms of revenues with € 29.9 billion in 2002. EADS has a workforce of more than 100,000 and is a market leader in defence technology, commercial aircraft, helicopters, space, military transport and combat aircraft, as well as related services. Its family of leading brands includes the commercial aircraft manufacturer Airbus, the world's largest helicopter manufacturer Eurocopter and MBDA, the world's second largest missile company. EADS is the biggest partner in the Eurofighter consortium and heads the A400M military transport aircraft programme. The company has over 70 sites in Germany, France, Great Britain and Spain. It is active in many regions worldwide, including the U.S., Russia and Asia.

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