Airbus

BAE SYSTEMS PLC
05 July 2006



                                                                     5 July 2006



   Not for release, publication or distribution in or into the United States,
              Canada, Australia, Japan or the Republic of Ireland.



  BAE SYSTEMS PLC SERVES NOTICE OF ITS INTENTION TO CONDUCT AN AUDIT OF AIRBUS


BAE Systems plc ('BAE Systems') announces that, in accordance with the terms of
the shareholders' agreement dated 11 July 2001 between BAE Systems, European
Aeronautic Defence and Space Company EADS N.V. ('EADS') and Airbus S.A.S. 
('Airbus') (the 'Shareholders' Agreement'), BAE Systems today served notice on
Airbus of its intention to undertake an audit of the Airbus Group (the 'Audit').


On 13 June 2006, Airbus announced that the delivery schedule for the A380
programme would undergo a delay of six or seven months due to production ramp-up
issues and EADS announced an anticipated annual EBIT shortfall from 2007 to 2010
as a result of this delay of approximately €500 million.


On 14 June 2006, BAE Systems announced that it did not believe any credible or
serious assessment of the likely financial impact of the delay in A380
deliveries could be made at that time.


On 2 July 2006, an independent expert determined the price payable by EADS in
relation to the proposed disposal of BAE Systems' interest in Airbus (the 
'Proposed Disposal').


BAE Systems expects that the Audit will assist its Board in assessing whether or
not to recommend that its shareholders vote in favour of the Proposed Disposal.
BAE Systems is required to give Airbus two weeks notice of its intention to
undertake an audit.  The Audit is not anticipated to be completed before the end
of August 2006.


A circular setting out the Board's recommendation to shareholders and further
details regarding the Proposed Disposal will be sent to shareholders after the
Board has had the opportunity to review the outcome of the Audit.



Issued by:
BAE Systems plc
London






                      This information is provided by RNS
            The company news service from the London Stock Exchange