The Boeing logo is displayed on a screen, at the NYSE in New York
WASHINGTON (Reuters) – Boeing Co <BA> has decided not to compete as a prime contractor to replace the Pentagon’s aging U.S.-based Minuteman III missile system, paving the way for Northrop Grumman Corp <NOC> to win a contract worth tens of billions of dollars.
Friday marked the deadline to submit proposals to continue work on the replacement of the nearly half-century-old intercontinental ballistic missile (ICBM) system as the military embarks on a costly modernization of its aging atomic weapons.
Boeing said in a statement that it was disappointed it was unable to submit a bid. Northrop said it had submitted its proposal. No other bidders were expected.
Boeing’s decision not to enter a bid as a prime contractor had been foreshadowed this summer in a letter from the chief executive of Boeing Defense Space and Security, Leanne Caret, to Air Force leadership, saying Northrop’s 2018 purchase of solid rocket motor maker Orbital ATK might make it difficult for Boeing to compete on cost.
Orbital is the top producer of the solid fuel rocket motors generally used in Minuteman III and similar missiles.
Upgrading the U.S. nuclear force was expected to cost more than $350 billion over the next decade as the United States works to replace its bombs, nuclear bombers, missiles and submarines. Some analysts estimated the cost of modernization at $1 trillion over 30 years.
The Pentagon’s Cost Assessment and Program Evaluation office has said the total cost to replace Minuteman III could top U.S. $85 billion.
– AWACS part of NATO investment in hi-tech surveillance
– Announcement comes days before NATO summit in London
BRUSSELS, Nov 27 (Reuters) – NATO on Wednesday awarded Boeing Co a $1 billion contract to upgrade its fleet of AWACS reconnaissance planes, a deal officials said showed the strength of transatlantic cooperation days before an alliance summit in London.
First flown in 1982 and repeatedly modernised, the Boeing-made planes, which can detect hostile aircraft, missiles, ships and other weaponry far beyond NATO borders, will be overhauled with more powerful computer processors, servers and equipment.
The 14 planes, based at an air base in Germany, can already exchange information via digital data links, with ground-based, sea-based and airborne commanders, but need a greater capacity to transmit data as technology develops.
The upgrade will keep one of the few military assets owned and operated by the Western alliance in service until 2035.
AWACS have been flown in support of the international coalition against Islamic State, gazing deep into Syria from Turkey, as well as along NATO’s eastern flank following Russia’s 2014 annexation of Crimea from Ukraine.
“The modernisation will ensure that NATO remains at the leading edge of technology,” NATO Secretary-General Jens Stoltenberg told a news conference alongside Boeing President Michael Arthur, standing in front of one of the planes.
“It will provide AWACS with sophisticated new communications and networking capabilities, so these aircraft can continue their vital missions,” he said.
One NATO official described AWACS, which have crews drawn from 18 different allies, as a symbol of NATO unity, at a time when U.S. President Donald Trump has questioned its value and French President Emmanuel Macron last month said NATO was dying.
The upgrade will be funded by 16 NATO allies, including the United States, Germany, Turkey, Italy and Spain, and some work will be subcontracted to European suppliers including Leonardo and Airbus.
The modernisation comes as NATO takes delivery of the first of five Global Hawk drones, which will be based in Italy.
After years of delays, the high-altitude drones made by Northrop Grumman give the alliance its own spy drones for the first time and will work with the AWACS to protect ground troops, as well as other tasks.
The drones will be able to fly for up to 30 hours at a time in all weather, providing near real-time surveillance data.
(Reporting by Robin Emmott Editing by Mark Heinrich)
Nov 6 (Reuters) – Aircastle Ltd said on Wednesday Japan’s Marubeni Corp and Mizuho Leasing Co Ltd had offered to buy the aircraft lessor in a deal valued at $2.4 billion, ending a nearly two-week long strategic review of its business.
Shares of the company rose 16% to trade in line with the offer price of $32 per share. Marubeni, the company’s largest shareholder, has a 29% stake in Aircastle as of Oct. 23 that is currently valued at about $600 million.
Aircastle, which owned and managed 277 aircraft in 48 countries as of Sept. 30, counts American Airlines, Southwest Airlines and United Airlines among its customers.
Airline bankruptcies have increased this year at the fastest ever rate, led by the collapse of India’s Jet Airways, British travel group Thomas Cook and Avianca of Brazil, adding pressure on aircraft leasing companies.
Fitch Ratings said in September that it expects the sector to worsen in the medium term with a potential rise in airline bankruptcies, further aircraft repossessions and increased financing costs. (http://bit.ly/2qrjaG5)
The deal, which is valued at $7.4 billion including debt, is expected to close in the first half of 2020, Aircastle said.
Citigroup Global Markets Inc will serve as financial adviser to Aircastle.
(Reporting by Sanjana Shivdas in Bengaluru; Editing by Shinjini Ganguli and Anil D’Silva)
Las Vegas, Nevada, October 21, 2019 – Embraer announced today a purchase agreement with Flexjet, a global leader in private jet travel. The deal comprises a fleet of Embraer business jets, which includes the recently certified Praetor jets and the Phenom 300. The announcement was made during a press conference at the 2019 National Business Aviation Association’s Business Aviation Convention and Exhibition (NBAA-BACE), which is being held through October 24, in Las Vegas, Nevada.
Valued at up to USD 1.4 billion, at current list prices, this deal was included in the 2019 second quarter backlog, with deliveries starting in the fourth quarter of 2019. With this purchase agreement, Flexjet becomes Embraer’s Praetor Fleet Launch Customer.
“We are very grateful for Flexjet’s renewed commitment to Embraer through this new agreement, which reflects the growth and the strength of our partnership over the past 16 years and symbolizes our ongoing support for their journey ahead,” said Michael Amalfitano, President & CEO, Embraer Executive Jets. “Flexjet Owners will appreciate and enjoy a truly elevated customer experience in industry-leading aircraft, including the recently certified Praetor jets, which are different by design and disruptive by choice.”
The partnership between Embraer and Flexjet dates back to 2003, when Flight Options, which merged with Flexjet in 2015, became the first fractional ownership program to introduce the Legacy Executive jet into its fleet. Offering customers a large cabin experience at super-midsize economics allowed Flight Options to serve more customers even better than before, while also supporting the company’s growth via Embraer’s high utilization, reliable aircraft design.
“We are proud to introduce the Praetor jets to the fractional marketplace and make technologically advanced midsize and super-midsize aircraft available to Flexjet Owners,” said Michael Silvestro, Flexjet CEO. “This order also represents the longstanding trust we have in Embraer and in their enhanced commitment to support the growth of our programs and of our partnership with industry-leading business jets.”
Flight Options introduced the Phenom 300 into its fractional program in 2010, receiving Embraer’s 100th milestone Phenom 300 in 2012, the first year in which the aircraft became the best-selling light jet. For the seventh consecutive year, the Phenom 300 has been the most delivered light business jet, according to GAMA (General Aviation Manufacturers Association). Also according to GAMA data, the Phenom 300 was the only business jet to reach the mark of 500 deliveries in the last decade.
Flexjet became the first fractional provider to offer the Legacy 500, in September 2015. In fact, Flexjet took delivery of Embraer’s 1,000th executive jet, a Legacy 500, in April 2016. The Legacy 450 joined the Legacy 500 in Flexjet’s Red Label fleet in August of that year, and both models became the first fly-by-wire Flexjet aircraft, offering performance and capabilities of larger aircraft with midsize economics.
– 28th annual Global Business Aviation Outlook projects 2020 deliveries to be higher than 2019 as new models enter service
– Five-year purchase plans for new business jets down slightly, but plans to buy used jets grow significantly
– Long-range forecast predicts healthy market with steady annual growth
LAS VEGAS, Oct. 20, 2019 /PRNewswire/ — The business jet industry is expected to see strong growth in the short to medium term, supported by several new airplane models coming to the market, according to Honeywell’s (HON) 28th annual Global Business Aviation Outlook. Released today, the Global Business Aviation Outlook forecasts up to 7,600 new business jet deliveries worth $248 billion from 2020 to 2029, down 1 to 2 percentage points from the 2018 10-year forecast.
“Production ramp up on many new business jet platforms are expected to lead to a 7% increase in deliveries in 2020, following a strong projected growth in 2019 over 2018 aircraft deliveries,” said Heath Patrick, president, Americas Aftermarket, Honeywell Aerospace. “We are confident that these new and innovative aircraft models will support solid growth in the short term and have a continuing impact on new business jet purchases in the midterm and long term.”
Key findings in the 2019 Honeywell global outlook include:
Operators plan to make new jet purchases equivalent to about 17% of their fleets over the next five years as replacements or additions to their current fleet, a decrease of 3 percentage points compared with 2018 survey results.
Of the total purchase plans for new business jets over the next 5 years, 35% are expected to occur in the first two years of the survey, with 57% of purchase plans realized by year three. This is 5 percentage points higher than last year’s survey.
Operators continue to focus on larger-cabin aircraft classes, from large cabin through ultralong-range aircraft, which are expected to account for more than 71% of all expenditures of new business jets in the next five years.
Once completed in 2023, the $2 billion transit hub will be the largest facility of its kind in the world with a vehicle leaving every two seconds at peak operations
Board of Airport Commissioners (BOAC) Commissioner Bea Hsu, BOAC Commissioner Gabriel Eshaghian, BOAC Vice President Valeria Velasco, BOAC President Sean Burton, Los Angeles World Airports (LAWA) Chief Executive Officer Deborah Flint, Councilmember Joe Buscaino, Mayor Eric Garcetti, Councilmember Mike Bonin, Deputy Mayor Billy Chun, Director of Economic Infrastructure -Office of Mayor Garcetti David Reich, LAWA Chief Operating Officer Justin Erbacci, LAWA Chief Development Officer Bernardo Gogna and LAX ConRAC Partners Project Executive Karl Schaefer.
(Los Angeles, CA) Mayor Eric Garcetti broke ground today on the Consolidated Rent-A-Car (ConRAC) facility at Los Angeles International Airport (LAX), which will centralize rental car operations into one convenient location and offer a direct connection to the upcoming Automated People Mover (APM) train. The Mayor was joined at the ceremony by Councilmembers Mike Bonin and Joe Buscaino, Los Angeles County Supervisor Mark Ridley-Thomas, Board of Airport Commissioners (BOAC) President Sean Burton, and Los Angeles World Airports (LAWA) CEO Deborah Flint, as well as community and labor leaders.
“We are building the world-class airport travelers need and deserve — and the Consolidated Rent-A-Car facility groundbreaking demonstrates how we’re keeping this promise,” said Mayor Garcetti. “Our city is doing so much more than building a parking structure — we are making an investment that will improve the traveling experience, reduce congestion in surrounding neighborhoods, and create middle-class careers for years to come.”
Since taking office, Mayor Garcetti has led a more than $14 billion transformation of LAX that began in 2009. Mayor Garcetti’s historic infrastructure investments have strengthened working families and the middle class. Under his leadership, unemployment has been cut in half while close to 200,000 new jobs have been created. Construction of the ConRAC is expected to create more than 1,000 jobs.
The 5.3 million square foot ConRAC facility will feature 18,000 parking stalls with 6,600 ready/return spaces, 10,000 idle vehicle storage spaces, and 1,100 rental car employee spaces as well as visitor parking. A Quick-Turn Around facility will also be on-site, allowing for fueling, washing, and light maintenance of rental car vehicles.
Mayor Eric Garcetti provides remarks during the groundbreaking ceremony.
Reducing congestion at LAX — as well as in surrounding communities — is at the heart of the ConRAC project. The consolidated facility will completely remove rental car shuttle traffic from the Central Terminal Area (CTA), which equates to 3,200 shuttle trips per day. The removal of the shuttles will improve traffic on the roadways and free up critical curbside boarding space in the CTA.
“This is a big step toward LAX becoming a world-class airport for travelers and a first-class neighbor to Westchester and Playa del Rey,” said Councilmember Mike Bonin. “Especially once it is connected to the new Automated People Mover, this new Consolidated Rent-A-Car Facility will reduce the number of shuttles and vans navigating the Central Terminal Area and nearby neighborhoods, improving both local traffic and air quality. That is a big win and exciting progress to celebrate.”
“This has been a momentous year for LAX,” said Councilmember Joe Buscaino. “LAX continues to move full steam ahead with its $14 billion investment to create a fully transformed airport of the future. The ConRAC is just one of the many groundbreakings held this year which highlight the efforts LAX is making to improve passenger experience which increases tourism and improves our local economy.”
As the second largest rental car market among domestic airports, the ConRAC will improve and streamline the car rental process at LAX. The facility will be built with an eye to the future and designed to accommodate new and emerging vehicle types such as autonomous vehicles. Additionally, movable concrete barriers will allow for the quick reallocation of space as rental car companies’ market shares shift.
The ConRAC is an important component of the Landside Access Modernization Program (LAMP), which also includes an Automated People Mover train that will connect travelers directly to airport terminals and create new and convenient locations for passenger pick-up and drop-off outside the Central Terminal Area. Once completed in 2023, the APM will connect with L.A. Metro’s light rail system.
Rendering of the ConRAC Facility at night.
“The ConRAC Facility will provide a rental car experience worthy of a world-class airport,” said BOAC President Sean Burton. “This project doesn’t just benefit those renting cars — it benefits the local economy and community through the creation of 1,000 jobs and by relieving vehicle congestion on the roads in and around LAX.”
“We are future-proofing everything we build at LAX,” said Deborah Flint, CEO, LAWA. “Every project under construction or on the drawing board will meet our needs now and be capable of adapting to new technology and demands. The ConRAC Facility is a prime example of how to future-proof so we can protect our investments.”
On October 26, 2018, the Los Angeles City Council approved an approximately $2 billion public-private partnership between LAWA and LAX ConRAC Partners (LAXCP), with LAXCP designing, building, financing, operating, and maintaining the facility for a 28-year period. LAXCP has committed to 30% local hiring, which exceeds local hiring requirements, and together with LAWA is developing opportunities for local small businesses. LAXCP has also agreed to sponsor 100 new, local apprentices and feature all-union labor on the ConRAC facility.
“Collectively, the LAXCP team has extensive experience designing, building, and operating nearly 30 ConRACs domestically and internationally,” said Karl Schaefer, LAXCP Project Executive. “We are proud to use our shared know how to help LAWA create a top tier experience for the traveling public at LAX while we honor our commitment to provide local hire economic opportunities and environmental sustainability.”
Mayor Garcetti has made sustainability a priority of his administration. The ConRAC facility is designed to reflect Los Angeles’ standing as one of the world’s leading sustainable cities and will include native drought-tolerant landscaping, reclaimed water usage, more than 200 Level 2 electric vehicle chargers, and a solar farm generating over 8,400 megawatt hours annually.
SHANGHAI (Reuters) – China Southern Airlines will carry out an equity diversification plan that will involve the injection of 30 billion yuan ($4.36 billion) of capital from three investors, the firm announced on Saturday.
The Guangdong Hengjian Investment Holding Corporation, the Guangzhou Urban Construction Investment Group and the Shenzhen Penghang Equity Investment Fund will each inject 10 billion yuan into the airline, as part of the country’s efforts to diversify ownership structures among state-owned firms.
The move will significantly improve the company’s debt-to-asset ratio, generate funds for its growth and help modernize its decision-making mechanisms, the announcement said.
It will also use the funds to serve its main air transportation business, pay for construction related to China’s Belt and Road Initiative and support aviation development in cities in the southern province of Guangdong.
China Southern is one of 96 enterprises owned and administered directly by the central government. Its profits slumped nearly 50% last year as a result of rising fuel costs and a weak yuan currency.
(Reporting by David Stanway; Editing by Himani Sarkar)
(Reuters) – Canada’s WestJet Airlines Ltd said on Monday it will be acquired by private equity firm Onex Corp in an all-cash deal for C$3.53 billion ($2.63 billion).
Including debt, the deal is valued at about C$5 billion.
As part of the deal, WestJet shareholders will receive C$31 for each share held, representing an about 67% premium to its closing price on Friday.
The investment will be led by Onex Partners, Onex’s private equity platform focused on larger investment opportunities and WestJet’s board has recommended that its shareholders vote in favor of the deal.
The private equity fund has a history of investing in aerospace, having previously held a major stake in Boeing supplier Spirit Aerosystems.
The deal is expected to close in the latter part of this year or early next year, the company said.
CIBC Capital Markets and B of A Merrill Lynch were the financial advisers to WestJet, while Barclays, Morgan Stanley and RBC Capital Markets advised Onex.
(Reporting by Debroop Roy in Bengaluru; Editing by Arun Koyyur)
The business year 2018 was an exceptionally successful one for Pilatus, but also a challenging one. At around 1.1 billion Swiss francs, sales revenue was brought back to the billion mark again. The 128 aircraft delivered in total included the first PC-24 – a milestone in the company history. All in all, 18 PC-24s were handed over to customers in the past year.
Financial 2018 was better than the previous year. At 1,092 million Swiss francs, sales revenue surpassed the one billion mark for the first time since 2015. The operating result totals 157 million Swiss francs. And the future looks good: following incoming orders worth 1 billion Swiss francs, the current order volume stands at 2.1 billion Swiss francs – the equivalent of just under two years of sales revenue. A total of 128 aircraft were delivered to customers – 18 PC-24s, 80 PC-12 NGs, 27 PC-21s and three PC-6s.
PC-24 in focus
Pilatus PC-24 Jet
The delivery of the first PC-24 to the first customer in February 2018 marked a milestone in the development phase spanning over eleven years. The brand-new Super Versatile Jet was the focus of much work throughout 2018: besides bringing PC-24 series production operations up to speed, the customer service unit and entire service network also switched to “live” mode. Pilatus continued to make improvements to the PC-24 in parallel, pushing ahead with various post-certification test programmes aimed at delivering all aircraft capabilities promised to customers at the outset. The next milestone is just around the corner: the reopening of the PC-24 order book.
Customer service business grows in both pillars
Whilst the military sector is hugely important to Pilatus, the lack of new trainer fleet contracts in 2018 is not unduly worrying: Pilatus is focused on the necessary upstream work and has reinforced its sales efforts in this area. Constant growth in after-sales business is encouraging.
Pilatus PC-12
The Business Unit General Aviation also saw continued expansion of its customer service operations. The volume of PC-24s in operation grows with every week that passes, generating similar growth in the number of customers requiring support. The network of Authorised Pilatus Centres was further strengthened to offer customers around the world the level of service they are entitled to expect in the business aircraft league.
Preparing for success in the future
At the end of 2018 the Pilatus Group employed 2,283 people, including 127 apprentices. Over 150 new jobs were created. 93 percent of all employees work in Switzerland. At the headquarters in Stans work progresses on the construction of the new structure assembly hall: this new centre of competence for airframe construction operations will be commissioned in spring 2019 – a clear sign of commitment to the location in Switzerland.
Pilatus PC-21
The new completion centre run by the US subsidiary Pilatus Business Aircraft Ltd in Broomfield, Colorado, opened in the autumn. In Adelaide, preparatory work continued for the construction of a new, company-owned building for the subsidiary, Pilatus Australia Pty Ltd.
Commenting on these results, Chairman Oscar J. Schwenk remarked: “I am pleased to note that financial 2018 was a very successful year for us. A year in which a great deal of energy went into performing much detailed work. Work which will take us forward throughout the coming year, creating added benefit for our customers. The good financial results of the past year will also benefit our employees under our profit-sharing programme. In addition to an extra month’s salary, they have also been paid a bonus of 1.5 salaries. Our next challenge is already in sight: the imminent re-opening of the PC-24 order book. This is the year in which the reputation of the PC-24 and all other related services will be established. We are consistent in our efforts towards that goal, thereby consolidating our success and our future.”
