Friday, June 16, 2006

Mr Incompetent

Noël ForgeardStraight from the school of "nothing is true until it has been denied by a minister" – or a company official - funding for the planned military wing of Airbus, the A400M airlifter, "is completely secure and will not be affected by problems surrounding the company's flagship A380 airliner".

So says an "Airbus top official" as the row surrounding Enron Airliners intensified with probes being launched into the collapse of the share price of the company’s parent, EADS.

Reuters is also telling us that Frenchman and CEO of EADS – in that order - Noël Forgeard, is clinging to his job after accusations of insider trading. It appears that he conveniently offloaded a tranche of shares just before the price dive, and is now claiming that he was unaware of costly delays to the A380 until after he had sold shares.

In France, opposition Socialists are calling for a parliamentary inquiry and a small shareholder group said EADS leaders should either be fired for incompetence or jailed for dishonesty.

Forgeard is not the only one who appears to have been "caught out" however, as Ambrose Evans-Pritchard records in this morning's Telegraph. He retails how three other top EADS executives had – completely innocently, of course - cashed in shares worth millions of euros in March, just weeks before the discovery of grave defects in the A380 wiring system. It was all an unfortunate coincidence said Mr Forgeard. None of them knew anything about the A380 problems at the time.

Arnaud Lagardère, the French co-president of the board, seems to be one of those who conveniently divested themselves of large chunks of stock, halving his 15 percent stake in EADS last month. He too insists he had been given no inkling of trouble at a board meeting in May. "If we had been dishonest, we would have sold all our stock. I have the choice of appearing dishonest or incompetent, a man unaware of what is happening in his own factories. I plead the latter," he said.

And that is just the sort of person you want at the head of the board of a high-tech aerospace company that wants you to trust your life to its products.


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