Airbus shares fall after plane tragedy

Shares in Airbus fell yesterday after the fatal crash of an A400M military plane weighed on Europe’s largest and already struggling defence project, while the planemaker pledged to overcome the tragedy.

The huge military plane crashed outside Seville on Saturday, killing four crew and prompting Britain, Germany, Malaysia and Turkey to ground their fleets of Europe’s new troop and cargo carrier.

France said it would keep flying its planes, while Airbus pledged to resume flight testing today with the head of its military aircraft business, Fernando Alonso, on board.

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Shares in Europe’s largest aerospace group, which hit a record high in April, fell as much as 4.5 per cent in trading, erasing gains seen in the previous week.

The A400M Atlas was developed for seven European NATO nations – Belgium, Britain, France, Germany, Luxembourg, Spain and Turkey – at a cost of 20 billion euros (£14.3bn), making it Europe’s biggest single arms contract.

So far Malaysia is the only export customer.

The plane entered service in 2013, more than three years behind schedule, and 12 out of the 174 sold have been delivered so far.

Problems in the development of the West’s largest turboprop engines helped to generate billions of euros of cost overruns and a bailout by the seven launch nations in 2010.