French aerospace group Latecoere said on Thursday that failure to buy two French factories from Airbus and the tough economic environment would force it to scale back its French business.

"The current euro/dollar exchange rate of 1 euro to USD$1.55 is forcing us to step up production at our subsidiaries and at our low-cost partners. This, in due course, will lead to an important reduction in our French activities," Latecoere's supervisory board chairman, Francois Junca, said in a statement.

Asked if this would lead to job cuts, Junca replied: "Nothing is excluded." Junca's statement was presented in the form of a question-and-answer session conducted by Latecoere itself.