Two of Europe's leading aerospace groups, EADS and Dassault, are to shift some of their production to dollar-based zones, putting pressure on governments to take action to check the rise of the euro.
EADS' aircraft unit Airbus, struggling to compete with US rival Boeing, has been particularly hard hit by the slump in the value of the dollar against the European single currency.
The weakness of the dollar 'is our main problem' and 'the only way to prepare the company for a dollar that no one can control is - unfortunately - to set up shop in a dollar zone,' Louis Gallois, CEO at the European Aeronautic Defence and Space Company, said.
Over the week end Dassault head Charles Edelstenne told the newspaper Le Monde that the company would move some of its production out of France 'to dollar or low-cost zones.'
A Dassault Aviation spokesman said today that Edelstenne was referring only to production of the Falcon business jet and not to Dassault's military programme.
The aerospace sector employs about 448,000 people in the 27-nation European Union.
No other sector has suffered so heavily from the surge in the euro, which 10 days ago came close to breaking through the symbolic $1.50 barrier.
Dassault and Airbus sell their planes in dollars but must cover most of their costs in the European single currency. With the dollar steadily depreciating against the euro, the value of their earnings has plummeted.
