Airbus flying away from Europe

Marketplace Staff Dec 4, 2007
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Airbus flying away from Europe

Marketplace Staff Dec 4, 2007
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TEXT OF INTERVIEW

Doug Krizner: European plane maker Airbus is reportedly considering a new factory in Alabama. A weak dollar and a soaring euro are the reasons why.

Let’s bring in David Gow from London’s Guardian newspaper. David, you describe this as the chief of Airbus issuing a wake-up call for Europe.

David Gow: Those were the words he used. He said that Europe has to wake up to the decline of the dollar and the impact that this has on European industry and manufacturing in particular. That it’s going to force companies to outsource or relocate more and more of its production to the dollar zone.

Krizner: Now, is the relationship between the dollar and the euro a life-threatening situation for Airbus, do you think?

Gow: Yes. Because basically, every 10 cents fall in the value of the dollar costs Airbus 1 billion euros, which in American terms is the equivalent of $1.4-$1.5 billion.

Krizner: So you are reporting in your article for the Guardian that Airbus officials are confirming that they are considering a plan to set up this new factory in Alabama. What would they produce there?

Gow: First of all, they would produce, if they win the Pentagon contract for these air-to-air refueling planes, they would build them there. But at the same time, they could also build parts for planes which would be destined for the U.S. airlines.

Krizner: So I want to zero in here. What you’re saying, then, is that this entire move toward Alabama is contingent upon Airbus winning the Pentagon contract, or not?

Gow: That’s right. There’s a huge — it’s one of the biggest lobbying campaigns in aerospace that the military in America you’ve seen for many, many a year. Supposedly, a decision will be taken early next year.

Krizner: David Gow is business report for The Guardian in London. We’ve been speaking to him this morning from Brussels. David, thanks so much.

Gow: OK, thank you!

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