Denel may wind down manufacturing for Airbus A400M

JOHANNESBURG – South African state arms company Denel is in talks with Airbus about winding down production of parts for the European planemaker’s A400M military aircraft, Denel said on Saturday.

Denel, a cornerstone of South Africa’s once mighty defence industry, is battling to emerge from a financial and operational crisis. In February it said it could sell stakes in some divisions as part of a strategy to return to profits within two years.

Denel said it was yet to finalise terms with Airbus for the winding down of production for the A400M.

“The two companies agreed that the continued manufacturing of aircraft parts by Denel is no longer sustainable in its current form,” Denel said in a statement. “Alternative options are now being considered between the two parties.”

Denel will try to minimise the impact on jobs at its Aeronautics division, it added.

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