Wednesday, May 30, 2007

EADS Insider Trading and the A380

I believe we blogged this a while ago, but the Associated Press is reporting that Airbus execs are on the hotseat again as a result of the investigation that's going on related to dumping EADS stock in advance of the bad news about A380 delays becoming public knowledge.

It seems that Technical Director Alain Garcia discussed this subject in detail during a meeting of EADS honchos on 7 March 2006, but no official record exists of that discussion. There is, however, a recorded telephone conversation in which Garcia admits as much.

What's significant about all this is that two weeks after the meeting of 7 March Noel Forgeard and 85 per cent of other EADS top execs exercised stock options and dumped their shares.

On June 13, the EADS Board met again, announced what we now know were the first official announcements of decomposition in the A380 program, and issued a profit warning that caused EADS stock to decline 26 per cent in value in one day.


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