The Future Combat Air System (FCAS) project remains a major sticking point between Paris and Berlin. This morning, AlphaValue analysts report that the German and French governments now appear ready to establish a Dutch legal entity to house the project, "while privately asserting that the project is doomed to failure."

According to analysts, this move would push the deadline beyond May 2027, when France will have a new president and, potentially, new strategic directions. "In short, a face-saving maneuver," the broker summarized.

As a reminder, the project's lack of progress stems from heavy friction between industrial partners Dassault Aviation and Airbus, who are locked in a dispute over project leadership.

Furthermore, Paris and Berlin have divergent requirements for the future combat aircraft. France requires a jet capable of carrying nuclear warheads while remaining light enough for carrier-based operations, whereas Germany favors a larger aircraft capable of carrying a heavier payload.

"I repeat, Airbus does not wish to collaborate with Dassault. I understand that; Airbus wants to work alone [...]. I do not know if they received a request from Germany that prompted these statements, but yes, this project is at a standstill. It is complex," stated Eric Trappier, CEO of Dassault Aviation, during the group's quarterly results presentation.

For his part, Airbus CEO Guillaume Faury acknowledged the persistent deadlock, which he attributed to "differing expectations between partners regarding governance and the definition of leadership and cooperation."

This morning, Dassault Aviation shares are trading flat, while Airbus is up 0.4%.