German chancellor Angela Merkel will meet French president Nicolas Sarkozy this morning to discuss the future of the troubled Airbus parent company, EADS.
After a tour of Airbus headquarters in Toulouse, the two leaders will try to solve the company's most pressing problem: the dual Franco-German management structure which has crippled decision-making.
The battle for the upper hand at EADS reflects the political implications of today's meeting. It is a test of strength of Dr Merkel against her new French counterpart, who has already made an energetic play for influence in the European Union after just two months in office.
"We want to participate reciprocally, equally from both sides," said Dr Merkel. "We have a common interest between Germany and France to arrange an efficient leadership structure so that the company truly can be well-led."
But she has made no secret of her fears, confiding to her predecessor, Gerhard Schröder, last week that she felt it was only a matter of time before she clashes with Mr Sarkozy.
Today's meeting lends itself to discord: EADS has been one long Franco-German tug-of-war since it was founded seven years ago. Now German officials are concerned that Mr Sarkozy wants to use the company as a vehicle for his rapidly-emerging nationalist nous in economic and industrial policy.
Franco-German infighting at EADS has contributed to a 23 per cent fall in share value since the beginning of 2006, while the shares of Airbus's arch-rival, Boeing, have gained 47 per cent. Development delays with the new A380 superjumbo have caused huge losses and could cost as many as 10,000 jobs.
Berlin is worried that, to revive the company, Paris will call for a new round of company financing. That could undermine German influence at the company: while Paris has a 15 per cent direct holding, Berlin is not a direct shareholder.
Dr Merkel has had to seek guarantees from Daimler, Germany's largest EADS shareholder with 15 per cent, that it would be prepared to provide additional financing as required.
Early indications are that a solution has been found to the dual management system, proposing a German chief executive and a French chairman. But this shake-up could raise new questions about the reporting structure, in particular who would directly supervise the head of Airbus. Problems could also arise if Mr Sarkozy seeks to get directly involved in EADS for a time to transform it into what he has called a "normal company".
Such moves would be opposed by Dr Merkel, just as she has criticised her French counterpart's suggestions to rethink euro-zone finance policy.
The two issues are inextricably linked: Mr Sarkozy advocates a weaker euro, in part to aid Airbus, while German officials back a strong currency and defend the independence of the European Central Bank.
"There's anything but German-Franco unity over EADS at the moment," said Ditmar Staffelt, Berlin's aerospace envoy in the previous administration. "It's hard to see this thing resolved."
