8th Jun 2015 05:52
LONDON (Alliance News) - Airbus is considering throwing open GKN PLC?s multimillion pound contract to supply parts for the A320 aircraft in a row over cost-cuts, The Sunday Times reported without saying where it got the information.
The European aerospace giant is believed to be considering inviting other suppliers to pitch for GKN?s work on the short-haul workhorse as it attempts to transform the meagre profit margins it makes on planes by demanding cost-cuts from suppliers, The Times said. Last year Airbus earned margins of about 6% on commercial aircraft, compared with more than 12% in GKN?s aerospace division.
Airbus wants GKN to cut costs by at least 10% but is believed to have run into opposition from the car and plane parts company, which employs thousands on Airbus work in Britain, the newspaper added.
Airbus told the Times that there is no dispute with GKN. ?Airbus is talking to all its suppliers on single aisle [craft] in light of the previously announced rate increases and seeking cost reductions in the region of 10%,? it said. ?This is standard business practice.?
GKN declined to comment to the newspaper.
http://www.thesundaytimes.co.uk/sto/business/article1565439.ece
By Steve McGrath; [email protected]; @stevemcgrath1
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