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EADS Plea For Airbus A400M Funding Trimmed

Seven nations that ordered the military transporter willing to contribute maximum of $2.81 billion in extra funding, far less than the $8.96 billion EADS asked for.

BERLIN (AP) -- The seven nations that have ordered the Airbus A400M military transporter would be willing to contribute a maximum of euro2 billion ($2.81 billion) in extra funding for the troubled project, German officials say.

A German parliament newsletter published Thursday quoted the Defense Ministry as saying the governments rejected as "unfounded" Airbus parent EADS' request for euro6.4 billion in additional funding during talks in Berlin this week.

Defense Minister Karl-Theodor zu Guttenberg said the nations are willing to continue negotiations on the project as there is "no alternative" to the A400M as a security and transport project. However, he said the sum the countries are prepared to contribute is at most euro2 billion, the newsletter said.

A German defense ministry official involved in the negotiations was quoted as saying that the nations -- Belgium, Britain, France, Germany, Luxembourg, Spain and Turkey -- "expect an offer from EADS."

French Defense Minister Herve Morin also increased pressure Thursday on EADS.

"We still need to discuss sharing the cost overruns, but EADS needs to make an effort," Morin said.

"The governments acknowledge that this is a military program, and all military programs have cost overruns, so they are ready to make an effort, but their effort must be matched by an effort at least as great, if not greater, by EADS."

The aircraft is now four years behind schedule and more than euro5 billion ($7.3 billion) over budget.

Talks between the two sides broke off on Wednesday and the German Defense Ministry said Thursday no round meeting had yet been scheduled.

Airbus has asked for a decision on funding by the end of January. Defense ministers will meet in Istanbul, Turkey, on Feb. 4 and 5.

The A400M had its maiden flight last month. The four-engine turboprop is seen as inhabiting an important niche market between the Lockheed Martin C-130J Hercules, which carries only half the payload, and Boeing's C-17 Globemaster III, which is larger, costlier, and less tactically versatile.

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