EADS AND BAE SYSTEMS WELCOME US AND EU COMMITMENT TO NEGOTIATION

Amsterdam/London, 11 January 2005 - EADS CEOs Philippe Camus and Rainer Hertrich and BAE Systems CEO Mike Turner welcomed the announcement by European Trade Commissioner Peter Mandelson to have agreed with the US to proceed with negotiations on a new agreement for government funding for aviation programmes.

"We are delighted at this apparent breakthrough in the transatlantic discussions. It has always been preferable that any differences between the US and Europe on this matter be overcome through constructive discussion rather than through legal recourse. Today's decision is a very positive step forward but much work remains to be done in order to ensure a level playing field in the commercial aircraft market. It is a substantial endorsement of the European Union's negotiating team led by Mr. Mandelson. It is clearly in all parties' interests to find a robust and workable agreement for the long-term future of this crucial industry. EADS and BAE Systems are firm advocates of free and open competition in the aerospace and defence markets around the world, and we will do everything that we can to support the full resolution of outstanding issues on this matter over the coming months."