U.K. Airbus A400M Airlifter Costs Exceed Plan by $1.2 Billion

The Airbus Military A400M airlifter for the U.K. is now running over budget by 770 million pounds ($1.2 billion), according to the British Ministry of Defence. 

There is also a cost overrun on a Thales SA (HO) Watchkeeper drone program and a Northrop Grumman Corp. (NOC) electronic system for aircraft, Philip Dunne, a minister for defense, told Parliament in written answers to questions. 

The U.K. is acquiring 22 A400M transports to replace Lockheed Martin Corp. (LMT) C-130s, a program running 73 months behind plan, the National Audit Office said. The airlifter is scheduled to enter service with the Royal Air Force in 2015. Lead customer France should get its first plane by the middle of this year. 

“Project performance can be affected by a number of reasons, not all of which are in the contractor’s control,” Dunne said. The increases are against the ministry’s total cost baseline, and not contracts with the companies, he said. 

Airbus SAS and countries funding the development of the A400M restructured the program in 2010 to address cost increases and schedule delays. The U.K. trimmed its purchase to 22 units instead of 25 as part of the review. 

The Watchkeeper unmanned aircraft program for the army is 57 million pounds above estimate and Northrop Grumman’s aircraft identification beacon is 6 million pounds above projections, Dunne said.

Atlas - New planes with an extra lift

Pilots Aircraft: Malaysian Air Force No. 2 impressed with the A400M Atlas, which will start service in 2015

Deputy Royal Malaysian Air Force chief Lt Gen Datuk Roslan Saad (left) giving the thumbs up to the A400M Atlas after a test flight in France yesterday. With him is Ed Strongman, Airbus Military chief test pilot.

Deputy Royal Malaysian Air Force chief Lt-Gen Datuk Roslan Saad recently tested the nation's next-generation transport aircraft in France.

Following the test flight, which took place in Toulouse, the country's second highest ranking military pilot gave the thumbs up to the Airbus Military A400M airlifter, which was recently given the codename Atlas.

"It is an enormous pleasure to fly the aircraft that is going to be at the heart of the RMAF's transport capabilities in the future.

"It is a real 'pilot's aircraft' and I look forward to seeing it enter service so that we can apply its capabilities on a wide variety of missions," said Roslan.

The government is expected to take delivery of the first aircraft in January 2015.

The agreement to buy the A400Ms was first highlighted in December 2005. A few days later, a memorandum of understanding for the procurement of four aircraft for the RMAF was signed between the government and Airbus Military.

The negotiations also centred on making the Malaysian aerospace industry a partner in the A400M programme.

Along with the deal for the aircraft, Airbus Military also signed a RM907 million agreement in designing and manufacturing composite A400M airframe parts with Composites Technologies Research Sdn Bhd.

Larger than the C-130 Hercules transport plane, which is currently used by the RMAF, the A400M was purchased to boost the RMAF's capabilities to transport cargo and troops. It has a length of 43.8m with a wingspan of 42.4m and a height of 14.6m.

It is a multi-role military tactical airlifter built to compete with other aircraft companies in replacing the ageing fleets of Hercules and C-160 Transall planes in air forces around the world.

With a payload of 37 tonnes, the A400M can carry twice the load of the Hercules. It is capable of conducting strategic operations, tactical missions and delivering fuel.

The aircraft has a high-flotation landing gear which allows take-offs and landings on short, unpaved airfields. This is crucial in battlefield conditions where the aircraft can land on semi-prepared airstrips with less than 1km of runway.

A total of 174 aircraft had been ordered by Belgium, France, Germany, Luxembourg, Malaysia, Spain, Turkey and the United Kingdom.

The aircraft programme, however, had been plagued by problems that caused customers to receive their planes late. The RMAF was supposed to take delivery of its first plane next year.