The development of new products, services and processes that bring competitive advantage to customers are at the core of EADS’ strategy. This has led to the family concept for Airbus planes, greater use of composites in planes and helicopters, the first fly-by-wire helicopters and the first PFI for military communications.

EADS invests substantially more than any of its competitors in innovation. In addition to institutional and government-financed research and development (R&D), the Group spent €2.1 billion on self-financed R&D during 2005, equivalent to over 6% of revenue. The Group also invested more than €600 million in research and technology to develop technologies for future products, services and processes.

To enhance the pace and relevance of innovation, management is reinvigorating technology research and product development. Speed is a key factor, and the Group will focus on ensuring the readiness level of new technologies at a much earlier stage. EADS’ capabilities will be continuously benchmarked, ensuring that the Company remains at the forefront of developments and, in particular, responsive to breakthrough technologies.

EADS will further strengthen its approach to systems architecture and engineering skills and tools by streamlining the use of design and engineering tools. Ambitious targets to reduce development times by up to half for major platforms have been set. There will be fewer tools, but these will be used Company-wide, as well as implemented in suppliers’ and partners’ organisations, increasing overall homogeneity.

New technologies are being introduced to save both cost and time. One day, virtual mock-ups will take over from flight tests and iron birds. The wind tunnel will be replaced by digital simulation tools. Development programmes will be shared seamlessly across the Company, with suppliers and partners around the globe striving for progress independent of time zones and Company structures.

To cover all aspects and achieve its ambitious goals, EADS will open up more to the outside. Technological programmes developed with either academic or industrial partners on an international basis will therefore have at least doubled by 2010.

Defined areas of focus for technology innovations are, for example, advanced sensor systems, material and structures, alternative energy concepts and human-friendly platforms.

A typical example of recent developments is the first flight in September 2005 of a helicopter using adaptive rotor blades, which can significantly reduce noise and vibrations. The technology demonstrator’s rotor flaps are powered by actuators made from ‘smart materials’. Following successful flight testing of the experimental system, it will be developed for series production.

Another example is the completion of the Airbus Visual Line (AVL) system on the shop floor at its final assembly stations in Toulouse. With its large electronic displays, it has replaced all paper printouts, providing detailed information about the work in progress, any problems and their resolution.

EADS will strive to go to the very limit of the achievable, delivering relevant breakthroughs and mature technologies as early as possible. This is challenging, but rewarding, and will bring further competitive advantage and nurture further growth; securing jobs, as well as bringing superior long-term shareholder value.