Shakeup seen at Airbus parent

NEW YORK (CNNMoney.com) -- The parent of European aircraft maker Airbus is close to an agreement to streamline its management structure in an effort to respond more quickly to problems at the company, but it also is facing new troubles over engines of is latest model, according to published reports.

The Wall Street Journal reported Monday that an agreement could be announced within the next week for European Aeronautic Defense & Space, the German-French consortium which owns Airbus.

Changes are being considered for Airbus parent EADS after the French and German consortium wasn't able to respond quickly to problems such as delays of the A380 superjumbo jet program.

The paper reports that German co-CEO Thomas Enders could become single chief executive, while Louis Gallois, currently president of Airbus and co-CEO of EADS, would keep his Airbus role but lose his EADS position.

New French President Nicolas Sarkozy and German Chancellor Angela Merkel are scheduled to meet at Airbus headquarters in Toulouse, France, on July 16, according to the report, and the two sides would like to reach a deal on their new structure by the time of that meeting.

EADS's management has been criticized for not reacting quickly, for example, when production problems with the Airbus A380 superjumbo project led to long delays and major management infighting at the plane maker. As Airbus stumbled, U.S. rival Boeing (Charts, Fortune 500) recaptured the lead in orders for commercial aircraft.

In a separate report, the Journal also reported that an escalating dispute between Airbus and jet-engine supplier General Electric (Charts, Fortune 500) could set back the European plane maker's A350 project yet again. Airbus has recently won new orders for the two-engine twin-aisle A350, but still badly trails Boeing's new 787 Dreamliner, which was unveiled Sunday.

The Journal reports that GE does not want to offer engines for the largest version of the A350, which is designed to compete with the largest version of another Boeing model, the 777, for which GE is the sole engine supplier. It is offering a version of the engine it is offering for the 787, but Airbus executives say GE's proposal is insufficient because it would work only for the two smaller of Airbus's three proposed sizes of A350.

Generally the two commercial jet makers give their customers a choice of engine suppliers between GE and British engine maker Rolls Royce. The paper said there is concern that the lack of engine choice could hurt the sales of the A350.

The paper reports that Airbus and GE both say they are continuing to negotiate over the A350 engines, and that while GE might still join the program in several years, no resolution appears imminent.