Tag: companies (Page 5 of 5)

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)

Mitsubishi Aircraft Signs MOU for 100 SpaceJet Planes

September 5, 2019 / WIL BALDWIN

(Reuters) – Mitsubishi Aircraft Corp and Mesa Airlines Inc, a regional airline operator, entered into a memorandum of understanding to begin talks on purchase of 100 SpaceJet M100 aircraft.

The aircraft is a revamped version of Mitsubishi’s smaller jet MRJ70, designed to carry 65 to 88 people.

Under the MOU, the companies target 50 firm orders and purchase rights for an additional 50 planes.

The deliveries to the unit of Mesa Air Group <MESA> would begin in 2024, Mitsubishi said in a statement.

(Reporting by Soundarya J in Bengaluru; Editing by Shailesh Kuber)

Alitalia Rescuers to Ask for Another Delay

September 5, 2019 / WIL BALDWIN

MILAN, Sept 5 (Reuters) – Companies hoping to rescue Italian carrier Alitalia will ask for a deadline for presenting their plan to be extended as they are still negotiating key aspects, two sources familiar with the matter said.

Italian railway group Ferrovie dello Stato, which is leading an effort to take control of Alitalia, is expected to ask administrators running the carrier for a “substantial” delay to the Sept. 15 deadline, one of the sources said.

It would be the sixth delay since Ferrovie expressed its interest in investing in the carrier at the end of last year.

Ferrovie, infrastructure group Atlantia and U.S. carrier Delta Air Lines have been discussing a joint plan for Alitalia for nearly two months, but they are at odds over highly-profitable North American routes, three sources familiar with the matter said.

The Italian partners in the consortium want Alitalia to have more freedom to expand its North American routes compared to what Delta is currently offering under a new cooperation agreement dubbed Blue Skies that it has set up with Air France KLM and Britain’s Virgin Atlantic.

How Alitalia would share the revenue coming from North American routes with Delta and other partners in the Blue Skies alliance is also under negotiation.

“The role of Alitalia in the Blue Skies alliance is a point of contention,” one of the sources said.

Long-haul flights to the United States and Canada account for more than one third of Alitalia’s revenue and are considered key to reviving the Italian carrier, which was put under special administration in 2017 after workers rejected the latest in a long line of rescue plans.

Administrators appointed by Italy’s government have cut costs and renegotiated plane leasing contracts to make Alitalia more efficient, but the carrier still burns cash and had been kept afloat thanks to a 900 million-euro bridging loan granted by Italy’s treasury.

Alitalia had only 410 million euro left in its coffers in July and would need fresh funds by the end of the year when it is expected to post a loss, according to another source.

Delta and Ferrovie declined to comment. (Additional reporting by Tracy Rucinski in Chicago Editing by Alexandra Hudson)

Rostec Ready for 737 MAX Out of Court Deal with Boeing

August 28, 2019 / WIL BALDWIN

MOSCOW (Reuters) – A unit of Russian conglomerate Rostec said on Tuesday it was ready for an out-of-court settlement with Boeing over its order for 35 Boeing 737 MAX jets, a spokesman for Rostec’s subsidiary Avia Capital Service told Reuters.

Boeing MAX 737 jets have been grounded worldwide and airlines are cancelling multimillion contracts following crashes in October and March that killed 346 people.

Earlier on Tuesday, Rostec said its unit had filed a lawsuit in the United States to cancel its order for the 35 MAX jets. The Financial Times, which first reported the move, said Avia Capital Service gave Boeing a cash deposit of $35 million.

A spokesman for Avia Capital Service told Reuters that delivery of the jets was first scheduled for October 2019 but was moved to March 2022. The Rostec unit had paid Boeing a deposit and was suffering losses from non-delivery, he said.

“If Boeing executives show a good will, we are ready to hold talks and find a mutually-beneficial out-of-court settlement for compensation of the losses we have suffered,” he said.

He added that the jets were ordered for a number of Russian air companies, including domestic low-cost firm Pobeda, a unit of the state carrier Aeroflot.

Russia is mainly using Boeing and Airbus jets for passenger flights, with a number of domestic airlines also adding Russian-made regional Sukhoi Superjet aircraft to their fleets.

The Rostec subsidiary now wants the deposit to be returned by Boeing with interest, along with $75 million in “lost profit” and about $115 million in compensatory damages, plus “several times the amount” in punitive damages, the FT said.

Rostec declined to provide further details about the lawsuit.

(Reporting by Gleb Stolyarov; writing by Anton Kolodyazhnyy and Tom Balmforth; Editing by Sherry Jacob-Phillips/Katya Golubkova and Emelia Sithole-Matarise)

Qatar Agrees to Buy U.S. Aircraft, Engines, Defense Equipment

July 9, 2019 / WIL BALDWIN

(Bloomberg) — Qatar has made agreements with U.S. companies to spend billions on airplanes and jet engines and to develop a petrochemical complex, the White House said on Tuesday.

At least some of the deals were previously made but were publicly touted by the Trump administration Tuesday. Among them: Qatar Airways purchasing Boeing Co. 777 freighters and large-cabin aircraft from Gulfstream Aerospace, the private jet unit of General Dynamics Corp.

“They’re investing very heavily in our country,” Trump told reporters at the White House. “They’re creating a lot of jobs. They’re buying tremendous amounts of military equipment including planes.

Qatar’s defense ministry committed to acquire Raytheon Co.’s NASM and Patriot Systems, according to the White House. In addition, a unit of Chevron Corp. entered into an agreement with Qatar Petroleum for the development, construction and operation of a petrochemicals complex in Qatar.

The agreements, whose total cost wasn’t disclosed by the White House, were announced during a visit to the White House by the emir of Qatar, Sheikh Tamim Bin Hamad Al Thani.

The deals come amid a two-year economic blockade of Qatar led by U.S. ally Saudi Arabia and supported by nations including Egypt and the United Arab Emirates. Trump initially appeared to support the Saudi move — echoing its assertions that Qatar supported terrorists — even though it put the U.S. in an awkward position because it has a major military base in Qatar.

But Qatar has looked to improve relations in the U.S., with the emir saying the country was committed to doubling the economic partnership between the two countries. Mansoor bin Ebrahim Al Mahmoud, who leads the Qatar Investment Authority, said earlier this year that the country’s sovereign wealth fund will look to increase its U.S. investment portfolio from around $30 billion to about $45 billion over the next two years.

The country has also made significant gestures toward increasing its spending on U.S. defense contractors, with the U.S. approving a large weapons systems purchase ahead of Sheikh Tamim’s last visit to the country. In 2017, the country signed a deal to spend $12 billion for the purchase of 36 F-15QA fighter jets.

And the U.S. has announced plans to expand and renovate the al-Udeid Air Base near Doha, which houses the forward headquarters of the U.S. military’s Central Command and some 10,000 American troops. During a dinner with the leaders on Monday, Trump thanked Sheikh Tamim for Qatar’s $1.8 billion investment in the project which will be used to construct housing and entertainment facilities.

Several companies have released specifics of some of the agreements that were formalized on Tuesday.

Gulfstream said its deal is for $1 billion in corporate jets that General Dynamics announced in January without giving the customer’s name. Boeing said last month it made a deal to sell five 777 freighters at a list price of $1.8 billion.

Qatar Airways plans to use General Electric Co. jet engines for Boeing 787 and 777 aircraft, according to the White House.

A Chevron statement Tuesday said the company was signing a new agreement at the White House for a previously unannounced $8 billion U.S. Gulf Coast project. The White House statement mentions only a prior deal, announced last month, in which the company would join forces with Qatar Petroleum to build a facility in Qatar.

(Story by Justin Sink and Thomas Black, Edited by Alex Wayne, Justin Blum, and Larry Liebert)

Airbus to Boost Pay to Help French Crisis

December 18, 2018 / WIL BALDWIN

PARIS (Reuters) – Europe’s Airbus (AIR.PA) is ready to pay a special bonus to its lowest-paid workers after French President Emmanuel Macron called on French companies to help tackle weeks of protests about the cost of living, according to a staff memo.

The intervention by Europe’s largest aerospace firm – part-owned by French, German and Spanish states – comes after Macron last week urged company leaders including planemaking chief and designated CEO Guillaume Faury to do more to ease the crisis.

However, Airbus – which depends primarily on exports of jetliners in competition with U.S rival Boeing (BA.N) – has also stressed the importance of remaining competitive and warned against focussing solely on “cyclical and pecuniary measures”.

“Airbus is ready to contribute and support the government’s action in response to this emergency, while recalling the absolute necessity to maintain the competitiveness of French companies that are exposed, like Airbus, to strong international competition,” said the memo to French staff seen by Reuters.

A spokeswoman said the size and scope of any bonus payment had yet to be defined and would be discussed in the regular course of dialogue with the company’s unions.

Airbus employs 48,000 people in France where aerospace workers are comparatively well paid, with average industry salaries of 4,250 euros (3,821 pounds) a month compared with the national average of 2,250, according to aerospace lobby GIFAS.

Airbus does however have an unspecified number of lower-paid workers in France, where its lowest wage stands at 1,700 euros a month, compared with the national minimum wage of 1,500.

Macron met bankers and company bosses including Faury last week after weeks of demonstrations against his government. Thousands took part in a fifth weekend of protests on Saturday.

The ‘yellow vest’ movement started in mid-November with protests at junctions against fuel tax increases, but quickly became a wider mobilisation against Macron’s economic policies.

During the protests, a convoy of parts for the world’s largest airliner, the A380, was briefly halted by protesters.

Last week reports said protesters blocked access to Airbus and Amazon sites in Toulouse, where the planemaker is based.

(Reporting by Tim Hepher; Editing by Mark Potter)