EADS Loses £692m as New Military Plane Costs Spiral Upwards

EADS, the parent company of European aerospace giant Airbus, lost 763m euros (£692m) last year after paying 1.8bn euros in penalties and extra costs over its controversial new military transporter plane. EADS also warned that the losses could be much bigger because it has not finalised agreements to compensate European governments which are set to receive delivery of the transporter planes three years late. Following its failure to deliver the new A380 super-jumbo on time and on budget, the news strikes a further blow to Airbus' reputation for being able to handle major programmes. The A400m transporter plane was designed to replace the "workhorse of the skies" favoured by the military all over the world, the Hercules, lifting heavy kit like tanks and helicopters into warzones. But the programme to build 180 of the planes, originally supposed to cost 19.1bn euros, is already billions of euros over budget and has seen scores of contracts cancelled. The UK government, which had ordered 25, recently indicated it was scrapping two or three planes,.