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EADS ANNOUNCES REORGANISATION OF DEFENCE SEGMENT

10 Sep 03. Dr Stefan Zoller gave a detailed description of the major reorganisation which have taken place to spliT the EADS unit into two separate divisions, EADS Defence and Electronics and EADS Defence and Communications Systems. This is a dramatic move away from the policy outlined at the 2001 Paris Air Show where Zoller told his audience that he intended to create a €3bn defence electronics segment within 3 years. At the time, given market conditions and limited acquisition opportunities, BATTLESPACE expressed doubt that this could be achieved. Zoller told BATTLESPACE Editor, Julian Nettlefold today that, “The objectives and assumptions made at the beginning have not been met.” He was asked whether the Electronics product segment now with sales of only €.6bn and 3334 employees could sustain itself as a stand alone company. Zoller said that discussion shad been held with EUROSYSTEMS amongst others but he did not expect any developments in the foreseeable future given that the unit was profitable and now able to sell to users outside EADS.

He announced the formation of a new EADS Defence and Security System house to meet the growing needs of the Network Enabled warfare Community in Europe. He said that given EADS’ wide customer base in Europe and the rest of the world the company was well placed to met the demands of the defence community in Europe whose NEC capability was lagging far behind the US and the UK.

The new segment, which would have sales of€1.2bn and approximately 5500 employees, would require a considerable investment from the parent to install the required simulation and advanced electronic equipment required to meet the demands of its new customer base. The segment, called a System Design Centre will encompass five key areas, Air & Naval Defence, which would include the UK’s GBAD requirement, which is drawing on extensive German experience in this field, C3I activities including tactical communications, ISR systems, all manned airborne mission systems and UAVs including EUROHAWK, Public Safety which will address Homeland Security issues and Communication and Information Networks which will address infrastructure solutions.

Zoller said that these changes had to be made to meet the growing demand from his customers for a system based solution using EADS’ expertise in integration.. The new segment will draw on the expertise from other areas of EADS such as Eurocopter, MBDA and Airbus to meet these complex solutions.

Two years ago Zoller stressed the importance of defence electronics to EADS to support its platform business, with the developments announced today, BATTLESPACE wonders whether the stand alone electronics segment is big enough to remain independent and to meet the growing needs of R&D and product development over the coming years or whether it will become part of the EUROSYSTEMS company, only time will tell.

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