German decision on £40bn project may drag on till November

The German parliament may not release Eurofighter production funding until November, even though chancellor Helmut Kohl told British prime minister Tony Blair last Friday that Germany needs the aircraft and a funding decision could be made in the coming weeks.

Thousands of British engineering jobs are hinged on the success of the four nation, £40bn Eurofighter project.

Germany’s cabinet will discuss German production funding on 11 July. The Bundestag is not expected to consider any decision before September and this process could drag on into November.

Eurofighter was also at the centre of last week’s talks between German defence minister Volker Ruhe and his British counterpart George Robertson. After the meeting, Ruhe said Eurofighter’s chances were now `better than 50-50′.

A possible solution to Bonn’s funding problems might see German Eurofighter partner Dasa repaying DM1bn (£355m) of Airbus subsidies to the German government early, allowing the money to be spent on Eurofighter.

UK Eurofighter partner British Aerospace said a November decision would still permit Eurofighter to enter RAF service as planned in 2001 `but beyond that we couldn’t say’. BAe had previously said that without a production decision by this June, the in-service date would slip to 2002.

Preparation for Eurofighter production is already underway at BAe’s Salmesbury plant in Lancashire, where modular construction work has taken place. `Some machinery has been installed, but we need new machinery worth another £90m at Salmesbury,’ a BAe spokeman said.

UK production will not start until 1999, with final assembly of RAF Eurofighters at Warton in Lancashire.

About 2,400 BAe staff work on Eurofighter.