The Franco-German FCAS initiative to build a next-generation warplane was scrapped this week amid tensions between companies involved, dealing a blow to European defence cooperation efforts.

Now fears are mounting for another joint project, the Main Ground Combat System (MGCS), which aims to replace battle tanks currently used by France and Germany.

Referring to it, Rheinmetall CEO Armin Papperger told the Welt am Sonntag newspaper: "There is always a risk, but nothing has been decided yet."

Rheinmetall is one of the companies involved, along with Franco-German arms maker KNDS and France's Thales.

Papperger said however that France is already planning to drastically cut the budget, with a figure under discussion of less than half of what was previously planned.

Cuts could delay the programme further, he added.

"If you have less money available, you won't get faster, and we are already very slow," said the Rheinmetall CEO.

The companies in the project have so far received only 25 million euros ($29 million), which is "very little money", Papperger said.

The MGCS is supposed to succeed Germany's Leopard 2 and France's Leclerc tanks around 2040. It is already behind schedule.

The Handelsblatt financial daily also reported Friday that a joint project to build an advanced European drone is also facing turbulence.

France's Dassault is demanding compensation from Airbus over the Eurodrone initiative as it will receive a smaller share of work from the project, it said, citing people familiar with the matter.

The drone is being developed by France, Germany, Italy and Spain.

sr/tw

RHEINMETALL

THALES

Dassault Aviation

Airbus Group