French State To Support Airbus Via Banks
January 25, 2009
The French state plans to inject EUR5 billion euros (USD$6.5 billion) into banks with the aim of financing aircraft purchases to help European plane maker Airbus, a French government source said on Sunday.
"There is indeed a plan to lend EUR5 billion to the banks to finance Airbus contracts," the source said, confirming an earlier report in the business newspaper Les Echos. The source gave no further details.
The newspaper said the state would inject the money into banks with a record of lending to the aeronautical industry. It named Calyon, Societe Generale and BNP Paribas.
"The aim is to prevent airlines from canceling orders citing difficulties in raising money," said the newspaper, which did not give its sources.
A French industry source said the plan, which appeared to have originated from the prime minister's office, would provide help on a broad basis to the banking industry and aerospace was one of several industries expected to benefit directly or indirectly.
The plane maker said on January 15 deliveries could fall and orders were set to drop as the global recession curbs demand for airliners.
Both Airbus and rival Boeing are bracing for more turbulence in an industry damaged by recent fuel price spikes as the economic downturn hits air travel. They also face a battle to prevent airlines canceling or deferring orders.
Copyright © 2009 Aviation News Release
