Aerospace giant EADS could change name to Airbus1 min read . Updated: 17 Jul 2013, 04:34 PM IST
Weak brand recognition cited as one of the reasons for name change
European aerospace giant European Aeronautic Defence and Space Company(EADS) may decide to change its name to Airbus, its better-known plane-making subsidiary, by the end of July to simplify and strengthen the brand, a source said on Wednesday.
But executives are torn over how useful a name-change would be for the group, which makes helicopters, missiles, drones and satellites.
The Airbus commercial plane division accounts for more than half of annual sales.
The issue highlights the big risks and opportunities involved in choosing, or changing, the name of a company or brand.
“This topic is in more-than-serious discussions. It’s very probable that the name change will happen," said a source close to the situation, who declined to be named.
“In any case, it should be on the agenda at the board meeting validating half-year results," the source added.
EADS is due to publish these results on 31 July, and the board meeting will take place beforehand.
The name change would mean that Airbus—maker of the A380 double-decker superjumbo airliner and an arch-rival of Boeing— would now group both military and civilian products.
EADS was created in 2000 of a merger of leading German, French and Spanish aerospace companies.
The name change has been on the cards for a long time, since it was believed that EADS suffered from weak brand recognition.
But a hugely-publicised failed attempt by EADS and British Aerospace
(BAE ) Systems to merge last year has boosted recognition of the EADS name, causing some executives to question any potential name change.
“When EADS wasn’t known, it (a name change) was of real interest, it would definitely have been added-value for the group," said one top executive, who refused to be named.
“But today, studies show that EADS is known, people know what EADS is particularly since the aborted merger with BAE Systems last year."
Others believe that naming the whole group Airbus could lead to a slight loss of identity for the plane-making division.
According to French economic daily La Tribune, EADS chief Tom Enders has set up a working group to study the technical and judicial implications of a name change.