New Airbus chief backs A350, warns of job cuts

PARIS — The new head of Airbus pledged Tuesday to go ahead with plans for a mid-sized jet and cost reductions identified by his predecessor, who quit after a leadership struggle.

Louis Gallois, appointed Monday to succeed former CEO Christian Streiff, said he was in favor of pressing ahead with the planned A350 jet to rival Boeing Co.’s 787.

“I believe that Airbus has to be present across the whole market, and the A350 is the middle of the market,” Gallois said in an interview with Europe-1 radio. The A350’s mid-size category accounts for “40 percent of the market” by value, he added.

Gallois also said the Airbus turnaround plan will involve “painful” job cuts, without giving details.

French financial daily La Tribune reported on its Web site that Airbus managers are discussing measures to cut 10,000 of the company’s 56,000 European employees. The company has denied that report.

Shares in European Aeronautic Defence and Space Co., which owns 80 percent of Airbus, rose 3.6 percent to close at 20.89 euros ($26.33) in Paris. The stock is still down 35 percent since the start of the year and 7.8 percent below its Oct. 3 closing price — just before the European plane maker announced a second year of delays to its A380 superjumbo.

After concentrating massive resources on its 555-seater flagship A380, Airbus has been outmaneuvered by Boeing’s two-engine 787, which delivers better fuel economy than older four-engine Airbus jets in the same size category — a sales argument that has grown more persuasive as fuel prices rise. Boeing has more than tripled the number of orders won by Airbus so far this year.