The three firms want to set up a satellite production entity to rival Elon Musk's SpaceX and growing low-cost competition from China and other countries.

Roberto Cingolani, head of Italy's Leonardo aerospace and defence giant, said in June that an accord could be taken by July, but the deadlines have been pushed back.

Michael Schoellhorn, chief executive of Airbus Defence and Space, told Corriere della Sera he expected a deal to be signed this year.

"We are on the right path but there are still aspects to clear up before such an important step," he said. Schoellhorn blamed the national and transnational "complexities" of the negotiations for the delay, especially for satellites.

Cingolani said that to compete with US and Chinese rivals, the new European firm would have to be more "flexible", offering production and launch services to military and civilian clients.

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Airbus Group

Leonardo

THALES