It seems old software blunders never die. At least that’s
the way it must feel at Airbus, the aerospace manufacturing unit of European
Aeronautic Defence & Space Co. (EADS).
Earlier this week, French stock market regulators said they would press insider trading charges
against 15 present and former executives at EADS and Airbus as a result of an investigation
into manufacturing delays and cost overruns in its A380 double-decker,
superjumbo jet program.
The manufacturing snafu the company encountered in the
latter half of 2006, which Airbus figured cost the company $6 billion in lost
profits, stemmed in large part from the four-nation aerospace consortium’s
botched use of computer-aided design (CAD) software.
The use of two different versions of the same CAD program, Dassault Systèmes
Catia, at its jet manufacturing operations in
France
and
Germany led
to wiring harnesses that didn’t fit, causing the A380 superjumbo to be delayed
by two years.
Following an Airbus announcement on
June 13, 2006, that the superjumbo
project was having manufacturing difficulties, EADS shares plunged 26 percent
in one day. Additional delays were announced in September and October of that
year.
France’s
Autorité des Marchés Financiers also announced it will file insider-trading
charges against French media group Lagardère SCA and German auto manufacturer
Daimler AG, which sold part of their EADS holdings in April, 2006. French securities
authorities are investigating whether EADS executives, board members and
shareholders knew about troubles with the A380 before the announcements of
difficulties were made.
The French government holds a 15 percent stake in EADS.
Lagardère owns 7.5 percent. Daimler is the largest EADS investor, with 22.5 percent.
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