Tag: competition (Page 3 of 4)

Brazil Association Takes Fight Against Embraer-Boeing Deal to Europe

December 5, 2019 / WIL BALDWIN

BRUSSELS, Dec 5 (Reuters) – An association representing minority investors in Brazil is lobbying European antitrust regulators to spike a deal between planemakers Embraer SA and Boeing Co, calling it a killer acquisition.

Aurelio Valporto, the head of minority investor association Abradin, said the European Commission should block Boeing’s proposed $4.2 billion purchase of 80% Embraer’s commercial passenger jet division or demand hefty concessions.

“What will be left from Embraer won’t survive, and even if it was possible to survive, Embraer wouldn’t be able to produce any aircraft with 50 passengers or more,” Valporto said in an interview late on Wednesday, arguing that Embraer and Boeing planes compete in the marketplace.

Embraer’s commercial jet division focuses on the 70 to 150-seat segment, competing directly with the CSeries jets designed by Bombardier Inc, a division that was bought by Europe’s Airbus SE.

Boeing aims to take control of Embraer’s commercial jet business, its most profitable, to compete directly with Airbus in the market for planes with fewer than 150 seats.

Embraer said in a statement on Thursday that the deal will “serve the interests of shareholders by enabling Embraer to expand markets and increase sales.” The deal was backed by around 97% of Embraer’s shareholders earlier this year.

Valporto complained about the deal to the European Commission two months ago, saying it hurt competition in the Brazilian aerospace industry, and on Wednesday took his grievance to antitrust officials in Brasilia.

The deal has already been approved by regulators in the United States, China and Japan. If it closes, Embraer will receive dividends from its remaining 20% stake in the commercial jet business, but will have to rely more heavily on its business jets and defense divisions to turn a profit. Those two divisions have posted losses in recent quarters.

The European Commission, which launched a full-scale investigation into the deal in October, declined to comment.

Boeing said it and Embraer had been engaged with the European Commission and other global regulatory authorities since late last year.

“We continue to co-operate with the European Commission and CADE as they assess our transaction and look forward to a positive resolution,” a spokesman for the company said.

The EU has voiced concerns the deal would remove Embraer, the world’s third-largest commercial aircraft maker, from the industry, an indication that it may demand significant concessions from Boeing.

The EU regulator halted its investigation last month while waiting for Boeing to submit data on the deal.

(Reporting by Foo Yun Chee in Brussels Additional reporting by Marcelo Rochabrun in Sao Paulo Editing by Kirsten Donovan and Matthew Lewis)

Vietnam’s VietJet Orders 20 Airbus A321XLR Aircraft

October 31, 2019 / WIL BALDWIN

Oct 31 (Reuters) – VietJet Aviation has ordered 20 Airbus long-range A321XLR aircraft that the budget carrier hopes will support its international expansion as Vietnam’s aviation market heats up.

VietJet expects the first aircraft to be delivered in 2023, it said in a statement on Thursday, adding that it will be the “first carrier in the world” to operate the new long-range version of the single-aisle A320neo family jets.

Industry sources said VietJet would be among the first to put the XLR into service.

Vietnam’s largest conglomerate in August applied to launch an airline next year, intensifying competition in one of the fastest-growing aviation markets.

The sector includes Vietnam Airlines, Jetstar Pacific Airlines and Vietnam Air Services Co.

The airline also signed a separate agreement in Toulouse, France, for two A320/A321 aircraft simulators.

VietJet’s order book for Airbus aircraft now totals 186, the airline said.

In September, Reuters reported that Airbus sold 15 A321XLR jets to VietJet.

Airbus on Thursday confirmed that VietJet had placed a new order for 15 XLR and said another 5 would be converted to the new jet from the A321neo model.

VietJet CEO Nguyen Thi Phuong Thao said Thursday’s order will “modernise VietJet’s fleet as we look to strongly grow our international flight network.”

The airline currently flies to destinations including Japan, Hong Kong, Singapore, China and India.

(Reporting by Nikhil Kurian Nainan in Bengaluru; Additional reporting by Tim Hepher; Editing by Jason Neely and Dan Grebler)

Arms Firms Fret Delays in Franco-German Fighter Project

October 7, 2019 / WIL BALDWIN

PARIS, Oct 7 (Reuters) – France’s Dassault Aviation and Europe’s Airbus have stepped up pressure on France and Germany to agree on the next stage of a planned fighter project, warning Europe’s arms industry and long-term security could suffer from delays.

The two companies are the leading industrial partners in a project to build a futuristic swarm of manned and unmanned warplanes, announced by the leaders of France and Germany two years ago and expanded earlier this year to include Spain.

Dassault and Airbus won a 65-million-euro contract in January to develop the concept for the Future Combat Air System (FCAS) but await a new contract to build demonstrators for interlinked fighters, drones and an “air combat cloud” by 2026.

Dassault Aviation Chief Executive Eric Trappier told a conference of policymakers last month that the demonstrator contract should have been launched in September but this was now slipping towards end-year. He called it “indispensable” to avoid any further delays in order to maintain the 2026 deadline.

No reason has been given for the delays.

On Monday evening, Dassault and Airbus amplified those warnings with a joint statement.

“If Europe does not move forward — and move forward quickly — on this programme, it will be impossible to maintain the development and production capabilities needed for a sovereign defence industry,” the companies said.

The warplane system is expected to be operational from 2040, with a view to replacing Dassault’s Rafale and the four-nation Eurofighter, in which Airbus represents both Germany and Spain.

The new project faces competition from Britain and its plans for a new combat jet dubbed “Tempest”.

The fighter developments have split the current Eurofighter consortium and led to a shake-up of industrial alliances as Italy joins Eurofighter partner Britain on Tempest, turning its back on Germany and Spain, while Sweden has opened the door to abandoning its independent stance by co-operating on Tempest.

The FCAS is also overshadowed by differences between France and Germany over export policy after Germany imposed a ban on arms exports to Saudi Arabia over the death of killing of journalist Jamal Khashoggi a year ago by Saudi operatives.

The ban, recently extended to March, has raised questions over a long-delayed Saudi border systems contract run by Airbus.

Airbus Defence and Space Chief Executive Dirk Hoke called in a magazine interview last week for the export ban to be relaxed. German Chancellor Angela Merkel’s government has said there is no reason for the moratorium to be lifted.

France and Germany are expected to discuss the issue at ministerial meetings this week.

AIRBUS SETBACK IN SPAIN

Airbus meanwhile faces a battle to shore up its position as a top defence contractor in Spain after losing its place as the representative of Spain’s interests on the upcoming fighter project to local defence electronics firm Indra Sistemas.

Spain last month named Indra as contractor for the Spanish share of the Franco-German-led FCAS project, displacing Airbus from the Spanish coordinator role it had held on Eurofighter.

Airbus officials have pledged to try to overturn the move but a Spanish defence source told Reuters there was no change in the decision.

Indra declined to comment.

Publicly, Airbus has said it was surprised by the decision but has pledged to continue to defend Spain’s best interests.

Dassault will meanwhile mark a long-awaited milestone on Tuesday when it delivers the first of 36 Rafales to India, the culmination of a fighter procurement process that lasted almost 20 years and involved the cancellation of a much larger deal.

La Tribune reported on Monday that France and India were discussing a possible repeat order for 36 more Rafales.

(Additional reporting by Emma Pinedo Gonzalez in Madrid, Tassilo Hummel in Berlin, Editing by Deepa Babington)

Airbus Pulls Out of Canada Fighter Jet Race

August 30, 2019 / WIL BALDWIN

OTTAWA (Reuters) – Airbus SE <EADSY> on Friday pulled out of a multibillion-dollar competition to supply Canada with 88 new fighter jets, a decision that boosts the chances of rival Lockheed Martin Corp <LMT>.

The defense arm of Airbus, which indicated last month it might withdraw, cited onerous security requirements and a late decision by Ottawa to loosen the rules for how much bidders would have to invest in Canada.

Airbus and other contenders had already complained the government appeared to be tilting the race in favor of Lockheed Martin’s F-35 plane, which the Royal Canadian Air Force wants. Canada is part of the consortium that developed the plane.

Canada launched the long-delayed competition last month and said it was confident no favoritism had been shown. Ottawa says the contract is worth between C$15 billion ($11.30 billion) and C$19 billion.

Canada’s official opposition Conservative Party, which is seeking to defeat Liberal Prime Minister Justin Trudeau in an October election, accused the government of gross mismanagement.

Reuters revealed in July that Airbus and Boeing Co <BA.N> had written to Ottawa to say they might pull out.

The firms are unhappy that in late May, the government dropped a demand that bidders must guarantee to give Canadian businesses 100% of the value of the deal in economic benefits.

Such legally watertight commitments, which Boeing, Airbus and Sweden’s Saab AB <SAABb.ST> had already agreed to, contradict rules of the F-35 consortium. Ottawa’s move allowed Lockheed Martin to stay in the competition.

“One of the strongest points of our bid was the fact we were willing to make binding commitments,” said an Airbus source, who requested anonymity given the sensitivity of the situation.

“Once this was loosened up to a point where these commitments were no longer valued in the same way”, the firm decided “that’s just too much”, added the source, who also cited security challenges.

European jets must show they can meet stringent standards required by the United States, which with Canada operates the North American Aerospace Defense Command.

“NORAD security requirements continue to place too significant of a cost on platforms whose manufacture and repair chains sit outside the United States (and) Canada,” Airbus said in a statement.

Canadian Procurement Minister Carla Qualtrough said she respected the Airbus decision, adding Ottawa was determined there should be a level playing field.

“This included adapting the economic benefits approach to ensure the highest level of participation among suppliers,” she said in emailed comments.

Canada has been trying unsuccessfully for almost a decade to purchase replacements for its aging F-18 fighters. The former Conservative administration said in 2010 it would buy 65 F-35 jets but later scrapped the decision, triggering years of delays and reviews.

Trudeau’s Liberals took power in 2015 vowing not to buy the F-35 on the grounds that it was too costly, but have since softened their line.

“Justin Trudeau has spent the past four years delaying and dithering on new fighter jets for Canada only to completely mismanage the competition process,” said Conservative defense spokesman James Bezan.

Lockheed Martin declined to comment while Boeing and Saab did not respond to requests for comment.

($1 = 1.3275 Canadian dollars)

(Reporting by David Ljunggren; Editing by David Gregorio)

L.J. Aviation Grows Fleet with Addition of Two Bombardier Challenger 350 Business Jets

August 25, 2019 / WIL BALDWIN

Two new Challenger 350 business jets recently added to L.J. Aviation’s existing fleet of more than 40 aircraft under management
The Challenger 300 aircraft series continues to outperform the competition as the fastest business jet in history to reach 300 deliveries in the medium and large categories and as the best-equipped aircraft in its class
With the widest and quietest cabin, smoothest ride and lowest operating costs in its category, the Challenger 350 aircraft delivers an unrivalled experience

Bombardier is pleased to announce that L.J. Aviation, a world-class aircraft flight management and charter aircraft company, has expanded its fleet with its latest addition of two industry-leading Challenger 350 aircraft. The high-performing Challenger 350 business jets join the company’s existing fleet of 40 aircraft and are available for charter in the Mid-Atlantic States.

“We are thrilled to receive our Challenger 350 aircraft,” said Ed Kilkeary Jr., President, L.J. Aviation. “It delivers everything we want in a business jet: outstanding performance, a comfortable and productive environment, and advantageous operating costs. The Challenger 350 aircraft is a sound investment that will make the most of our passengers’ time.”

Extending its offering with two new industry-leading Challenger 350 business jets, L.J. Aviation currently manages and operates five Challenger 300 series business jets, one Challenger 604 aircraft and a Global 5000 aircraft.

In the last decade, the Challenger 300 aircraft series has accounted for more deliveries than any other business jet platform in the industry. The Challenger 350 aircraft builds upon this remarkable legacy of leadership and continues to take centre stage in the super mid-size segment.

“We are proud of our long-standing relationship with L.J. Aviation, and we are extremely pleased that they have added two Challenger 350 aircraft to their fleet,” said Peter Likoray, Senior Vice President, Worldwide Sales and Marketing, Bombardier Business Aircraft. “This business jet is world-renowned as the leader in the super mid-size segment, and with good reason. A stunning cabin, smooth ride and exceptional value proposition all make the Challenger 350 aircraft an ideal choice for customers.”

With a true full seats, full fuel, 3,200 nautical mile range, the Challenger 350 aircraft is an efficient and reliable business tool with proven performance. Delivering comfort without compromise, the Challenger 350 jet was recently recognized by Robb Report Magazine as the Best of the Best super mid-size aircraft for the second consecutive year.

Mexico Fines Cancun Airport $3.7 Million over Taxi Monopoly

August 23, 2019 / WIL BALDWIN

MEXICO CITY, Aug 22 (Reuters) – Mexico’s competition regulator said on Thursday it fined the airport at tourist hot spot Cancun $3.7 million for blocking new taxi operators, which it said reduced competition and effectively overcharged millions of passengers.

Grupo Aeroportuario del Sureste (ASUR) , the Mexican company that runs the Cancun airport along with 15 others across Latin America, said it will challenge the ruling and the 72.5 million pesos fine.

The Federal Economic Competition Commission (Cofece) said that from 2010 to at least 2018, the airport gave mostly negative assessments to taxis wishing to operate at the Cancun airport, preventing them from receiving federal permits.

“By being the only entity that can lease and grant spaces for taxi access… (the airport) took various actions to prevent new participants from offering said service,” Cofece said in a statement.

As a result of the airport’s moves to limit the market, fares were marked up about 8% on average for several million trips.

The regulator did not name any of the taxi operators that were blocked from the Cancun airport.

($1 = 19.8203 Mexican pesos)

(Reporting by Daina Beth Solomon Editing by Leslie Adler)

Textron Bell 407GXI Earns IFR Certification

August 18, 2019 / WIL BALDWIN

FORT WORTH, Texas (15 August 2019) – Bell Textron Inc., a Textron Inc. (NYSE:TXT) company, announced the Federal Aviation Administration (FAA) has issued an Instrument Flight Rules (IFR) Supplemental Type Certificate (STC) for the Bell 407GXi. The certification is a requirement for the Navy Advanced Helicopter Training System competition, enabling the Bell 407GXi to replace the Bell TH-57 Sea Ranger as the US Navy’s training helicopter.

Bell’s replacement bid offers a unique combination of capability, ease of transition, and low sustainment costs, giving the best value to the Navy. Should the Bell 407GXi be selected for the US Navy Advanced Helicopter Trainer program, the company plans to conduct final assembly of the aircraft in Ozark, Alabama.

“The team did a great job ensuring the Bell 407GXi achieved the FAA’s IFR certification necessary to meet all of the Navy’s requirements,” said Mitch Snyder, president and CEO. “Bell is an instrumental part of the Navy’s training program and has been for more than 50 years, and we look forward to continuing the tradition for the next generation of Naval Aviators.”

A Bell to Bell transition offers low-risk to the Navy by streamlining instructor pilot and maintainer transition training as well as using common support equipment and infrastructure. The 407 airframe has already proven capabilities as the platform for the MQ-8C Fire Scout for the US Navy. Bell’s industry-leading customer service and support has established capability with cost-efficient and effective helicopter training solutions.

Bell proves its mature production and sustainment support capability every day by supporting more than 1,600 Bell 407s globally. These aircraft have nearly 6 million flight hours across the fleet and are actively performing flight training as well as military and para-public missions helicopter mission-set. The 407GXi’s Garmin G1000H™ NXi Flight Deck enhances situational awareness and reduces pilot workload by delivering easy-to-read information at a glance. The Bell 407GXi’s new IFR capability will allow all-weather operations while continuing to provide multimission capability safely, reliably, and effectively. The Bell 407GXi offers the lowest direct operating costs of any IFR-capable helicopter produced today. Combined with its proven performance, reliability, and ease of transition, the Bell 407GXi is the best value aircraft for US Navy helicopter training.

WestJet, Delta Air Lines Obtain Clearance for Joint Venture

June 27, 2019 / WIL BALDWIN

WestJet and Delta Air Lines today announced that their proposed U.S. – Canada transborder joint venture has received clearance under Canada’s Competition Act from the Canadian Competition Bureau. The CCB issued a no-action letter confirming that it does not intend to challenge the proposed joint venture agreement between WestJet and Delta Air Lines.

“Today’s clearance by the CCB is an important step towards satisfying the conditions necessary to implement the proposed WestJet-Delta transborder joint venture,” said Ed Sims, WestJet President and CEO. “We thank the CCB for its timely and thorough review. The joint venture will lead to more consumer choice, connectivity, and economic benefits on both sides of the border by growing U.S.-Canada business and tourism travel.”

Ed Bastian, Delta’s CEO, said, “This significant achievement brings us closer to implementing a joint venture that provides a world-class experience for customers travelling between the U.S. and Canada. The joint venture between Delta and WestJet will create an expanded network with more frequencies and destinations, improved airport connections and significantly enhanced frequent flyer benefits.”

The proposed joint venture between the two airlines is still subject to regulatory approval from the U.S. Department of Transportation.

Upon receipt of all regulatory clearances or approvals in the U.S., the new joint venture will enable Delta and WestJet to deepen their existing partnership with expanded codesharing, reciprocal elite frequent flyer benefits, optimized growth across the U.S.-Canada transborder networks, and co-location at key hubs with initiatives designed to deliver a more seamless guest experience. The partners will also begin implementing joint sales and marketing activities and increase belly cargo cooperation.

Further information about WestJet and Delta Air Lines is available at westjet.com and delta.com.

Cebu Air to Buy Over Two Dozen Airbus Jets

June 17, 2019 / WIL BALDWIN

PARIS, June 17 (Reuters) – Airbus is set to win a deal to sell jets worth around $4.5 billion at list price to Philippines airline Cebu Air after a face-off with rival Boeing, industry sources said.

The deal involves 16 A330neo wide-body jets and around 10 of the newly launched A321XLR extended-range narrow-body aircraft, the sources said, asking not to be identified.

Together with other aircraft and options the deal could involve as many as 40 aircraft, one of the sources added.

Airbus declined comment. Cebu officials could not be reached for comment.

The deal follows a fight for business at the Philippines budget airline as Airbus seeks a new foothold for its A330neo in the face of heavy competition from Boeing’s 787 Dreamliner.

The carrier had at one point been seen as likely to proceed with a Boeing 787 order, prompting Airbus to rescue the deal .

Cebu Air plans to expand its fleet with new aircraft that burn less fuel, CEO Lance Gokongwei said last month.

Asian carriers are looking to renew their long-haul fleets as passenger demand remains robust despite a decline in cargo.

(Reporting by Tim Hepher; Editing by Laurence Frost)

SpaceX Sues U.S. Air Force Over Rocket-Building Contracts

May 22, 2019 / WIL BALDWIN

ORLANDO, Fla. (Reuters) – Billionaire Elon Musk’s SpaceX accused the U.S. Air Force of breaking contracting rules when it awarded money to three rocket makers but passed on Musk’s rival bid, and said the tender should be reopened, according to a court filing unsealed on Wednesday.

In the complaint, Space Exploration Technologies Corp said contracts were awarded for three “unbuilt, unflown” rocket systems that would not be ready to fly under the government’s timeline, “defeating the very objectives” outlined by the Air Force’s program.

SpaceX asked the court to force the Air Force to reopen the $2.3 billion Launch Service Agreements competition and reconsider the Hawthorne, California-based company’s proposal.

The agreement is part of a Department of Defense initiative to assure constant military access to space and curb reliance on Russian-made RD-180 engines.

In the watershed race for dominance in the space industry, new entrants including SpaceX and billionaire Jeff Bezos’ Blue Origin, compete for lucrative contracts for military launch services. The arena has been long dominated by incumbents like Boeing Co-Lockheed Martin Corp’s United Launch Alliance (ULA).

ULA was granted $967 million under the program for developing its heavy-lift Vulcan rocket, Blue Origin won $500 million for its New Glenn rocket, and Northrop Grumman Corp was awarded $791.6 million for its OmegA rocket development.

In separate court filings this week, all three companies argued they should be parties to the lawsuit because of their direct financial interest in its outcome.

A SpaceX spokesperson said the company sued to “ensure a level playing field for competition.”

Representatives for the Air Force and ULA did not immediately respond to requests for comment. Blue Origin declined to comment.

SpaceX’s complaint was filed with the U.S. Court of Federal Claims last Friday under seal, along with a request for the court to keep the proceedings secret under a protective order, citing proprietary information. A redacted complaint was filed Wednesday.

SpaceX alleged the Air Force broke contracting rules on five different counts and asked the court to halt deliveries of the award to the three companies and force a re-evaluation of the proposals.

The Air Force rejected a formal objection from SpaceX in April regarding the terms of the awards.

SpaceX has sued the government over contracts before, most prominently in 2014 to protest a multibillion-dollar, non-compete contract for 36 rocket launches to United Launch Alliance. It dropped the lawsuit after the Air Force agreed to open up the competition.

(Reporting by Joey Roulette in Orlando, Florida; Editing by Eric M. Johnson and Richard Chang)

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