Eric Trappier (Dassault Aviation): "The dual civil military model keeps the plants in France»
How's Dassault Aviation, between the economic crisis and the reduction of military budgets?
Dassault does not go bad. But that does not mean that there are no difficulties. Our turnover is 30% in the military and 70% civilian. And these 70%, 80% of our clients are businesses. When they reduce their investments, sales of Falcon in feel. The worst of the crisis, we had more cancellations than orders. Fortunately, we had a backlog fairly well stocked allowing us well through the crisis. It was not easy, because we increase our rates. We have been able to do so fairly sweet, with a bit of technical unemployment, but without redundancy. This is one of our characteristics as knowing adapt quickly, as well as the peak production declines.
Falcon sales have they benefited from the growth of the new rich in China or Russia?
Image "I'm rich so I bought a Falcon" does not correspond to reality. Customers tend Falcon business leaders seeking efficiency. That said, behind the appearance of these new rich, there is especially a new generation of entrepreneurs who invest primarily for their business. They spend their life in the air. I know even in Africa who prefer to sleep in their aircraft on the ground rather than the hotel.
Business aviation is it out of the crisis?
Today, we have no cancellations, which makes us say that we came out. But then we thought off again quickly, the recovery is rather flat, especially in the United States, which remains our main market, with approximately 50% of Falcon service. Companies are ready to order, but still hesitant. We hope clicks in 2014. Moreover, the situation has returned to normal. In South America, Brazil and Mexico continue to buy. China has slowed down a bit after a very strong start. But the outlook is very favorable, with the gradual liberalization of airspace. Africa also works very well. Russia remains very user business aircraft to go from coast to coast.
Two months after its launch, the new Falcon 5X does he deliver?
The beginnings were very promising. I will not say how, but we raked firm orders, not just purchase commitments. We will unveil the numbers in a few months.
Competitors will they stay long mainly North American?
On the high end, it is at the top of technology. To reach this maturity, must have experience. We, we have sixty years of experience. That's why new entrants are not many on the market for business jets. Besides the Brazilian Embraer, I do not see many others. One day, there will be Chinese. They start at the bottom of the market, with regional aircraft, but it will take time.
Dassault remains there a French industrial group?
Dassault is undoubtedly a French group. This is his first great feature. Managers, consultants and most jobs are in France: 10.000 12,500 employees, the others are the United States, Little Rock, to the interior of the Falcon. The second major feature of Dassault is to be an exporting company. Exports account for about 75% of turnover. This is not new. Over the last fifty years, 78% of our production was exported.
78% of export sales, production in France Does it still make sense?
There is a certain interest, despite the constraints. The first is cost pressure in euros, which penalizes us against competitors such as the United States Gulfstream and Bombardier in Canada. The other major constraint is everything related to the French competitiveness hourly costs and taxes. We see the difference with our factory in the United States. The additional cost is about 10% in taxes, both in labor costs. The relief announced helped stabilize this cost differential, but not to reduce it. Despite all this, we still manage to sell and earn money.
How do you compensate?
In a very compact size society. We also use massive digital design tools. We also have many robotic our factories. Last but not least, we have a totally dual use our resources between the civilian and military. The offices, manufacturing sites are common. Merignac assembling both civilian and military aircraft. A Martignas it manufactures both civilian and military wings. This gives us tremendous flexibility. Civil activity can be drawn and when the civil going so well, the military is there to maintain the activity. In addition, two outlets feeding by dual technologies. The military has developed electronic controls, for example, and we also delivers superior to that of our competitors, however, are exclusively civilian quality.
We must remain in the military, even if budgets are falling?
Absolutely! It is this dual civil and military model that allows us to maintain plants in France.
The military planning law has bet that 7 will be exported Rafale in 2016. Is it too late?
No. The White Paper on Defence decreased the size of the air force 225 fighter planes. There are still hundreds to deliver. Budgetary problems are known and identified. So the Ministry of Defence and Dassault have made a bet to overcome this difficulty by export. If ever this bet was not won, we planned to meet again in 2015.
We can therefore expect the end of 2015 for you to sign the first contract?
Rather say early 2015.
Where negotiations with India?
They are progressing well. It is long because it is complex. The negotiations involve the sale of 126 combat aircraft, but also on the licensed production of virtually all components of the aircraft. This implies much agree with local industry, HAL in particular. The second difficulty is elections in India in the spring. It is mobilized to finish everything before. If it is after, it will take a government to be formed, which will be fast, and he revisit the subject. But as the case is prepared by the administration and the army, which remain, they, could be finalized before the end of 2014.
The death of the Indian chief negotiator would have disrupted the negotiations ...
Totally false.
What camp Eurofighter, which lost in the final against the Rafale, made to destabilize you?
Whatever he does, it's not an issue for me. Eurofighter will not return. Why do you Indians start from scratch after spending so much energy for years? Therefore while the Rafale was considered better and cheaper with a willingness to transfer important technology for the modernization of Indian industry?
The lesson of failure in Brazil is not it that the Rafale can interest a handful of countries?
If you mean by handle at least five, then yes. The Rafale is made to make war. It therefore affects countries that show a certain maturity in the field. This is the case of the India.
The last EU summit called for a program of drone intelligence is born. Will it work this time?
We will make a Male drone intelligence in Europe. There will not that U.S. drones in Europe. Whether for a UAV surveillance or combat, is a problem of sovereignty. After Europe is organized as she wants. Governments to decide. Our responsibility is to make proposals. We did a lot. They never went after. Duly noted. We made "‹"‹a last (with Airbus and Finmeccanica Group, Ed), and I think this is the last. We can live without Male drone manufacture in Europe, but combat aircraft will be lost part of our know-how.
You would be willing to leave the leadership to Airbus if a program is created?
We have no taboo.
The development of military drones should not go along with that of civilian drones?
Arguably, the chain pulling drones from a military requirement, which is usually higher than the civilian needs of a technological point of view, we will derive a civil sector which, tomorrow, will allow some of the automation Civil Aeronautics. This is the case cockpits. Before, when you pulled on the handle, it was moving control surfaces. Today, it is the computer that does. The next step for UAVs will deport these commands on the ground, but it will require a major effort, which should be supported by the State and Europe.
Civilian drone Dassault, is it relevant?
No. But never say never, even though I can not imagine a Falcon unmanned.
The European defense, do you believe?
Europe, as it is represented today is not a European sovereignty in charge of foreign policy and defense. There has been significant progress over the last ten years, but not enough to reach a sovereign as the United States. It will take much time.
Should push forced march consolidation of the defense industry in Europe?
This would mean destruction for the forced march does not mean anything. Defense industries are dual. Forced marriage manufacturers who do not want no sense. Engineers leave. Your consolidation is something else. EADS and BAE wanted, but not the government, for reasons of sovereignty. Every country wants to use it, which seems normal.
You are in favor of a European preference in military procurement?
I advocate a European preference for everything related industries strategic sovereignty to the European economy. When the United States poured billions in Boeing, it is not protectionism. They protect their country.
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