Safran ready to discuss A400M, but won't share Airbus penalties

PARIS, Feb 24 (Reuters) - French aero engine maker Safran (Milan: SAF.MI - news) said on Friday it would be prepared to discuss changes to the engine contract for the troubled Airbus A400M military aircraft, but ruled out sharing the planemaker's bill for penalties incurred so far.

Airbus has called for talks with buyer nations and the engine consortium over ways to ease the contract, which has resulted in new penalties that it blames in part on flaws with a gearbox supplied by a sub-contractor to the engine makers. .

"Naturally if we agree to discuss the contract, the overall balance of risks and opportunities of this contract must remain at the same level," Safran Chief Executive Philippe Petitcolin told reporters.

"We can't pay other peoples' penalties when our contract doesn't foresee it, so that is out of the question and we will respect our contract. If for the future, there is a proposal for different conditions which could offer more incentives for everyone, then we will look at it with great attention and we will decide collectively," he said.

Safran (LSE: 0IU8.L - news) is part of a consortium with Rolls-Royce, MTU Aero Engines and Spain's ITP to supply the A400M's turboprop engines.

An interim fix to problems with the gearbox supplied by Italy's Avio, owned by General Electric (Euronext: GNE.NX - news) , is working and development of a definitive solution is advancing, Petitcolin said. (Reporting by Tim Hepher, Editing by Dominique Vidalon)