Eurocopter sees German defense deal in two-three months

BERLIN Wed Sep 12, 2012 7:35am EDT

BERLIN (Reuters) - Eurocopter, a unit of European aerospace and defense company EADS EAD.PA, expects to reach an agreement with the German government in about two to three months on a downsized order for helicopters, its chief executive said.

"We are in very constructive talks," Lutz Bertling told journalists at the ILA Berlin Air Show on Wednesday.

German Defence Minister Thomas de Maziere wants to cut major defence orders as part of sweeping reforms of the military.

The army, for example, wants 40 instead of 80 of Eurocopter's Tiger military helicopters and 80 instead of 122 units of the NH-90 transport helicopter.

Eurocopter is now trying to negotiate a deal in which the government orders about 15 naval versions of the NH-90, in addition to the 80 army models, Bertling said.

"We cannot imagine doing a deal without re-designation of some orders to naval helicopters," he said, but added talks on the Tiger were currently going better than those on the NH-90.

Bertling's comments were more upbeat than remarks made by parent company EADS's CEO Tom Enders earlier this week.

He said at the opening press conference for the ILA air show that talks with the German government were "tough but constructive" and warned that involved companies might eventually have to think about utilizing their capacities for other purposes, such as civil projects.

De Maziere's plans also include cutting by 37 to 140 the order for Eurofigher aircraft and reducing an order for Puma tanks to 350 from 410.

Eurocopter, which is also the world's largest civil helicopter maker, expects sales to rise 10-11 percent to just about 6 billion euros ($7.7 billion) this year thanks to a rebound in the U.S. market in the second half and demand from the oil and gas industry.

The company generates about 45 percent of its revenues with military contracts, while the rest is related to civil orders.

At the ILA Berlin, it signed a framework agreement to sell 130 million euros worth of EC145 T2 and EC135 helicopters to ADAC, Germany's auto club.

Eurocopter has also been showcasing its X3 high-speed helicopter technology at ILA, which it says can fly and descend at 50 percent higher speeds than conventional helicopters.

The company recently completed a six-week U.S. demonstration tour with the technology, which it says could eventually be used on anything from passenger transport to offshore oil and gas transportation or border security.

Bertling said it will probably take another six or seven years until Eurocopter brings a finished product to market, though he said the feedback from potential customers in the United States was "overwhelming".

(Reporting by Maria Sheahan; Editing by Mark Potter)