* Airbus, Safran set to form jv in space launchers -sources
* Move follows warnings over impact of low-cost rival SpaceX
(Adds details, background)
By Tim Hepher and Cyril Altmeyer
PARIS, June 15 Airbus Group and Safran
are set to boost co-operation with a joint venture in
space launchers, aiming to galvanize Europe's competitive
response to U.S. low-cost rival SpaceX, people familiar with the
The heads of the two companies, both leading contractors on
the Ariane space launcher, are due to meet French President
Francois Hollande early on Monday, Hollande's office said, but
no official reason for the meeting was provided.
Two people familiar with the matter said space would top the
agenda, amid growing pressure from industrial groups for a
shake-up of Europe's public-private system of building rockets.
The move is expected to involve closer partnership between
Airbus Defence & Space, which builds the Ariane launcher, and
the Herakles space propulsion unit of French aerospace group
Safran, which makes its solid rocket motors.
It is the first concrete step towards consolidation after
Airbus Group Chief Executive Tom Enders, speaking exclusively to
Reuters last month, called for a shake-up to prevent Europe
becoming "irrelevant" in the $6.5 billion space-launch industry.
His call for a bigger industry was triggered by the arrival
of low-cost U.S. based Space Exploration Technologies (SpaceX),
run by electric car mogul Elon Musk.
But industry sources say there have been disagreements with
France's CNES space agency over the right strategy to adopt.
Musk's SpaceX company offers lightweight rocket launchers to
send up communications satellites at lower prices than those
currently on the market, including Europe's Ariane 5.
Europe aims to replace the Ariane 5 rocket launcher with an
Ariane 6 by 2021, but is wrestling with complex structures
behind the design, manufacture and marketing of space launchers
as well as strict conditions on the national share of work.
Under the current system, government agencies such as CNES
in France and the DLR in Germany design launchers, and pass the
designs to Airbus Group to manufacture the product, which is
then passed to a third party, Arianespace, to market.
Airbus Group owns around 30 percent of Arianespace, whose
biggest shareholder is the French space agency, CNES. Safran
owns just under 11 percent.
By seizing the industrial initiative, Enders and Safran
Chief Executive Jean-Paul Herteman are effectively offering to
lead Europe's fight-back against SpaceX but must also tackle
sensitivities among public bodies involved, observers said.
Enders has likened the threat posed by SpaceX to a wake-up
call that forced European planemaker Airbus to reorganize after
rivals Boeing and McDonnell Douglas merged almost 20 years ago.
Without a new industrial set-up, Ariane 6 and the
intermediary Ariane 5 ME will be a failure, he believes.
Les Echos newspaper, also reporting a new co-operation
venture, said Airbus and Safran would propose a new technical
configuration for Ariane 6 as part of the move. France and
Germany have been at odds over the rocket's design, which must
be resolved ahead of a ministerial meeting in December.
(Editing by Gus Trompiz and Sandra Maler)