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Rising euro forces move for France's Dassault
Rising euro forces move for France's Dassault
Sunday December 02, 2007
France's Dassault Aviation will move some of its activities out of the eurozone because of the high level of the European currency against the dollar, the company's chairman said in an interview published Saturday.
"We are in the process of preparing measures to adapt the company to the new situation created by the latest slide in the dollar," Charles Edelstenne told the Paris daily Le Monde.
"They will be announced to the work force at the beginning of January."
Edelstenne said assembly of Dassault aircraft, which include the Falcon business jet and the Rafale fighter, would stay in France along with high technology work, "which guarantee the quality of our planes."
"Apart from that, everything can be relocated."
Edelstenne said that Dassault, whose main competitors are in the United States, could not cope with a 30 percent depreciation of the dollar against the euro in the past two years.
"The natural approach will be the relocation to dollar or low-cost zones, as has been done by the automobile industry," he said, adding, "we must reduce our costs further to remain competitive."
The Dassault chief said moves could affect the manufacture of certain components, and some office work, but not aircraft design.
"It will all be done gradually, we have to be sure that our chosen partners meet our quality standards."
Dassault Aviation saw its net profits soar by 46 percent in the first half of 2007, thanks to the success of the Falcon, but it has failed to sell the Rafale to anyone but the French armed forces.
European planemaker Airbus has also sounded the alarm about the strong euro, with the head of parent company EADS, Louis Gallois, warning last month its long-term survival was at stake.
Gallois also spoke of moving part of production out of the eurozone.
Like Dassault, Airbus's production is centred on Europe and its costs calculated in euros, but its sales are in dollars in common with the rest of the industry.
Fijilive
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