Why is it necessary for Eurocopter to undertake such complex cooperation programs?
Andreas Loewenstein: The U.S. and European markets have reached maturity; there’s no getting away from that fact. If the Eurocopter Group wants to hold onto its market shares and continue to expand, it has to focus on the growing markets in Asia and Latin America. To conquer these markets, Eurocopter has two options: It can either open subsidiaries, or enter into cooperation agreements with local industry. These cooperation agreements can take many forms, ranging from the sale of licenses to co-production or co-development programs.

Why not simply sell licenses, therefore, rather than become involved in co-development programs?
A.L.: The ultra competitive nature of the international market means we have to do more than simply sell licenses: We ignore that fact at our peril. Cooperating with international partners provides work for our design offices and boosts production. And when all is said and done, it is also a means of protecting our core activities at our long-standing plants. Without this international growth, we would endanger our overall business.

Where does cutting production costs fit into this?
A.L.: For some of our activities, it would be misleading in my opinion to say that relocation automatically reduces costs. Manufacturing in Asia is not always less expensive than it is in Europe. However, manufacturing abroad does protect us from currency fluctuations, and not just the dollar! I have many reasons to believe that in 15 or 20 years’ time, other currencies will be very strong – in particular, in the Asian markets. We need to prepare for that day now.

So cooperation is inevitable.But how do we also protect our know-how?
A.L.: Certain high-tech sectors must remain exclusively in our domain. Lines have been drawn and everybody involved in negotiating international cooperation agreements knows not to cross these lines. We also have to keep on innovating: That’s the only way we will stay one step ahead of the competition. Yes, technology transfer does take place, but these transfers must be carefully planned and thought out so that Eurocopter can keep its competitive edge over the long term.

Isn’t there a risk that we will have to continue upping the ante in our technology transfers in order to keep winning contracts?
A.L.: Yes, that is a risk. But it is one that we are well aware of. Eurocopter has been a pioneer in many different types of cooperation agreements in the past, but now the competition is closely following our lead. We are faced with situations where the knowledge we agree to transfer can be just as important as the performances of our aircraft. Finding the right balance among transfer, innovation, transparency and protection is a delicate task. When we hand something over, we have to be sure we know what the next step is. In any case, Eurocopter will never sell off its technology at cut rates just for the sake of short-term gains. We only agree to technology transfers when they are part of our long-term international deployment strategy.