April 2, 2009 / 9:25 AM / 10 years ago

UPDATE 3-German snooping scandal engulfs Airbus

* Airbus admits spying on its own workers

* ‘Spybus’ revelations deepen German privacy scandal

* Chairman of Airbus parent EADS tapped for Deutsche Bahn

* Labour unions seek pledge on jobs

(Rewrites, adds EADS no comment, background)

By Markus Wacket and Brian Rohan

BERLIN, April 2 (Reuters) - Airbus parent EADS was swept up in a German snooping row on Thursday as Berlin moved to poach its chairman to resolve a railway spying scandal — on the very day that Airbus itself admitted to prying on its workers.

Battling to contain a political row over employee privacy, the German government said it would nominate EADS EAD.PA chairman Ruediger Grube, 57, to take the helm at scandal-hit national rail network Deutsche Bahn [DBN.UL].

The previous Deutsche Bahn chief executive, Hartmut Mehdorn, was forced to announce his resignation on Monday following disclosures that the state-owned firm spied on most of its 220,000 employees as part of an anti-corruption campaign.

Planemaker Airbus, which is part of Franco-German-controlled EADS EAD.PA, admitted on Thursday it too had spied on staff between 2005 and 2007 in an effort to prevent corruption.

Former management at Airbus’s German business ordered checks to see whether bank account numbers for staff matched those of suppliers, it said in a statement. All staff members in Germany were examined in the probe which ended in mid-2007.

The ‘Spybus’ revelations threaten embarrassment for EADS, whose secretive Innovation Works labs design sophisticated snooping equipment for global defence forces, and add to a growing clamour in Germany over corporate Big Brother tactics.

Last year, Deutsche Telekom admitted it had illegally monitored phone records.

POWER BALANCE

Grube’s transition to the railways from EADS would also have to be handled sensitively to avoid upsetting a fragile power balance at Europe’s largest aerospace group, controlled by German car firm Daimler (DAIGn.DE) and a French entity comprising media group Lagardere (LAGA.PA) and the French state.

Grube’s replacement would have to be nominated by Daimler, where he is also responsible for strategy and acquisitions.

German Chancellor Angela Merkel and French President Nicolas Sarkozy agreed in 2007 to end a rocky power-sharing system which had saddled EADS with two chairmen and two chief executives since it was founded in 2000 and was blamed for in-fighting.

Corporate governance at EADS is seen as one of the keys to often prickly economic relations between France and Germany, and neither leader will be keen to upset the boat as they promote a message of unity at major international summits this week.

It was not immediately confirmed whether Grube would have to step down as non-executive EADS chairman if he were confirmed in the Deutsche Bahn position, though passenger jets and high-speed rail are increasingly seen in competition for the same business.

EADS declined to comment.

Deutsche Bahn’s board, which must still confirm Grube as the new Bahn chief, is scheduled to meet on Thursday but trade unions said no decision would be made before Monday.

“I know from the wealth of evidence we’ve assembled he’s a brilliant manager. He’s not likely to re-politicise Bahn,” Finance Minister Peer Steinbrueck told Hessische Rundfunk radio.

Mehdorn won plaudits for turning Deutsche Bahn into a profitable global transport leader but was criticised for his confrontational approach to unions and for backing the partial privatisation of the rail operator.

The privatisation was scheduled for last autumn but was cancelled due to volatile market conditions — a situation the Social Democratic contender for chancellor in September’s election said would likely remain the case for some time.

“The crisis in international financial markets makes privatisation or partial privatisation unrealistic for a long time,” Foreign Minister Frank-Walter Steinmeier told Passauer Neue Presse newspaper.

Rail labour unions said they would discuss Grube’s candidacy at a meeting on Monday and that labour representatives on Deutsche Bahn’s board would not give their approval before then.

“Our demands have not yet been met. Above all, we are calling for a clear commitment to an integrated Bahn and to a company-wide labour market that protects jobs,” the GDBA and Transnet unions said in a joint statement. (Writing by Brian Rohan, Kerstin Gehmlich, Tim Hepher; Editing by Simon Jessop and Elaine Hardcastle)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below