Hallbergmoos, June 2012

The Economic Impact of Eurofighter - Spain

The Eurofighters economic impact in Europe The value of the three contracts signed to date for the Eurofighter programme is: Tranche 1 - 7 Billion euro (148 aircraft) Tranche 2 18 Billion euro (236 aircraft) Tranche 3 9 Billion euro (112 aircraft) Austria 1.7 billion euro (15 aircraft) Saudi Arabia around 8 billion euro (72 aircraft)

Total employment on Typhoon is estimated at more than 100,000 personnel employed directly and indirectly in over 400 companies throughout Europe. i) ii) ii) iii) Germany: 25,000 Italy: 20,000 Spain: 22,000: UK: 40,000

Eurofighter partner companies (Alenia Aeronautica; BAE Systems; EADS Deutschland; and EADS CASA) are all involved in the design and production of major aircraft components including final assembly, supporting approximately 50,000 jobs. The EJ200 engine. Managed by EUROJET Turbo GmbH, some 4000 personnel are employed in the EJ200 programme. Of which: Rolls-Royce (UK): 500 direct and 3000 if the supply chain is considered MTU (Germany): 600 direct/indirect, plus 400 in the supply chain ITP (Spain): 200 direct, 300 in the supply chain Avio (Italy): 350 direct Typhoon is a fundamental programme for the European engine sector, totalling about 15% of the total business of MTU and Rolls Royce. Supplier companies: mainly small and medium-sized firms with design and production responsibility and/or production responsibility for sub-components and parts supporting approximately 50,000 jobs.

Eurofighter suppliers have average annual sales of 201 million euros; employing around 1600 personnel; defence sales were 64% of total sales and employment on Typhoon accounted for some 5%-10% of total company employment. These firms also have suppliers working for their company this would typically be around 30 suppliers involved in their Typhoon production with some 5-6 suppliers accounting for 75% of the purchased inputs for Typhoon production. Typhoon supports employment in development work which requires highly-skilled scientists and engineers; including among other roles, production work which is skill-intensive; and in support activities often in high technology, such as the simulation industry. Many of the Typhoons labour skills are highly transferable (e.g. to motor car and electronics industries; and to work on Airbus A380) The Eurofighter programme is a successful and significant contributor to the nations economic wellbeing, employing some of the brightest minds in thousands of high-value manufacturing and engineering jobs. Typhoon offers a variety of industrial benefits. These include the maintenance of an independent European high-tech aircraft industry, including independence from the USA. The Programme has contributed to equipment standardisation amongst the partner nations and export customers. The Eurofighter Typhoon Programme also provides a world leading competitive defence industrial capability required for a strong future European Defence Technological and Industrial Base. Typhoon is also contributing to the creation of a range of modern business practices which are being applied throughout the supply chain. Industrial benefits and spin-off Carbon fibre technology, with further applications to civil aircraft is key to the programme Typhoons is 70% carbon fibre made. The carbon fibre manufacturers on Typhoon are centres of excellence in each partner nation, with Typhoon providing these firms with a stable work-load. This technology has spun-off and been applied to heavy machines (e.g. milling machines) and motor cars. Spin-offs have included to the civil sector ranging from aircraft to motor car industries and their supply chains. For example, Alenia Aeronautica is using its carbon fibre technology from Typhoon for its role in work on the Boeing 787 and other aircraft projects. Similarly, Typhoon technology has been applied to Airbus jet aircraft. In addition, super plastic forming and fusion bonding have produced new production methods without the need for traditional manual operations. In aero-engine technology, The Eurofighter EJ200 engine is a world leader. It could be used on other military aircraft; and there are further applications of its technology to civil aero-engines. It involves the casting of high temperature blades where there are some world leaders; blade technology; repair technology and high technology welding. Other examples of spin-offs include power generation engines for civil work; applications to the health sector (e.g. surgery; joints); cameras used to inspect the engine have been applied to dentistry; the development of better materials able to withstand high temperatures; and benefits to software technology firms. Other examples include applications of the brush seals

technology developed for the EJ200 engine. This technology is being applied to power generation; electrical motors; construction machining; and mining equipment.

The Economic and Industrial Benefits of the Eurofighter Typhoon

Programme Economic and Industrial Benefits Employment Technology Exports and (including spin- Import-Savings offs) e.g. Carbon fibre Exports valued 100,000 jobs at Euros 10 billion. technology; High wage/high skill jobs, especially aero-engine Import-saving development; and technology. valued at Technology jobs secured for Euros 33.5 - 54 externalities over 40 years. billion. valued at Euros Total 7.2 billion balance (minimum) payments contribution Euros 3.5 -64 billion Others

Typhoon

European independence and security of supply. Demonstration of ability to integrate complex systems and to manage a 4-nation collaboration.

Export The estimated demand for fighters in the next 20 years is 800 a/c the Potential Market Share for Eurofighter Typhoon is between 250 and 300 a/c. Campaigns: Switzerland; Greece; Japan; Romania; Turkey; India; South Korea. Interests: Bulgaria, Croatia; Czech Republic; Slovakia; Poland; Saudi Arabia; Oman; Kuwait; Qatar; Bahrain; Canada; Malaysia; Denmark. Exporting the Eurofighter Typhoon will bring important benefits. 300 aircraft would mean a further 5-6 years of production with additional employment and contributing to securing jobs for the long term, thus strengthening Europes defence industrial base. It has been calculated that winning the tender in India will bring to 125,000 jobs secured today by the programme in Europe. The Austrian Typhoon order of 15 aircraft involved a significant offset deal and the Kingdom of Saudi Arabias contract for 72 aircraft is valued at 8.9 Billion dollars, supporting over 11,000 jobs for the duration of the contract. Exports provide additional employment. Typhoon exports include initial spares, maintenance, equipment and training over the life-cycle of the Typhoon which will include at least one major

mid-life up-grade. The value of this life-cycle business might be an extra 50% to 100% of the initial price over 35 years. Typhoon exports usually involve an industrial participation by the customer nation. For Typhoon exports to Austria, there is a 200% offset agreement. Offsets are direct on Typhoon and indirect on other aircraft programmes and non-aircraft programmes, using Eurofighters industrial conglomerate contacts and its suppliers (e.g. car business via Daimler AG; transfer of repair business). On Typhoon, export sales initiatives are led by one partner nation (e.g. EADS, Germany, managed the Austrian export bid; BAE Systems led for Japan, etc.). The offset programmes help to build-up the presence of the four countries industries, not only in the aerospace sector, with a further benefit for the partner nation economies The Eurofighter Typhoon contributes to the balance of payments for the four partner nations at around 43.5 - 64 billion euros.

The Eurofighter programme in Spain The Eurofighter programme has been one of the main driving forces of the aerospace sector in Spain. The Spanish Government praises the Eurofighter programme as a lighthouse for national technology gain for EADS Defence & Security Spain and other companies, ensuring that the vast majority of the financial investment remains in Spain. The Spanish Ministry of Defence launched this R&D project during the 80s, the most ambitious of its history, and bet to support the former Construcciones Aeronuticas military transport aircraft. The result has been a consolidated aeronautical sector with an industrial network in continuous evolution, and it has generated an intellectual capital essential to make profitable this investment with a strengthened and promising future. The Eurofighter programme has not only been a driving force in the integration of the European aeronautical industry, but a reference within the R&D programmes as a result of the economic and industrial return on the significant investments that were realised. The programme has been the developer of new and innovative companies like ITP, CESA or TECNOBIT, and improved others like INDRA, Espelsa, Gamesa or the Official Technological Institute, INTA. At present they compete in the most ambitious European collaboration projects. Thanks to the established cooperation agreements, 99.5% of the money invested in this programme is invoiced by Spanish companies, it means that 40% of the 10,700 million euros invested will return to the state as direct or indirect taxes (IVA, Tax of societies, Social Security, Rates and Tributes). The Defence division of EADS in Spain has a turnover of 584 million euros (2009). The Eurofighter programme was the highest earner with 450 million euros. Production of the Spanish Eurofighters started at its Getafe site in the summer of 2001. The highly modern infrastructure and production facilities guarantee top efficiency in final assembly. Thanks to the programme, high technologies have been developed in Spain in the areas of Production (e.g. carbon fibre), Engineering (e.g. Flight Test, Simulation) and Systems Integration

(e.g. Final assembly, Communications, General Systems) and made possible for its industry to participate in the main European collaboration programmes. (TALARION, A400M). In Spain, total employment on Eurofighter is estimated at some 22,000 personnel, both directly and indirectly (3,000 EADS D&S Spain plus ITP, 4,000 in the main contractors and 15,000 induced employments). This strength ensures that the industry in Spain will be able to meet any challenge and this is the greatest return from the effort that has been made.

High Resolution images of the Eurofighter Typhoon can be downloaded from our web site: http://www.eurofighter.com/media/image-library.html

For More Information contact: Theodor Benien Head of PR & Communications Tel.: +49 811 80 1555 Fax: +49 811 80 1557 Mobile: +49 160 93 99 38 40 Mail: theodor.benien@eurofighter.com Kathryn Holm External Communications Tel: +49 (0)811 80 1587 Mob: +49 (0)172 88 12110 Fax: +49 (0)811 80 1557 Mail: Kathryn.Holm@Eurofighter.com