The first A350 XWB for Japan Airlines (JAL) has rolled out of the Airbus paint shop in Toulouse, France. The A350-900 is the first ever Airbus aircraft to be produced directly for JAL and features a special A350 XWB red logo on the fuselage.
The aircraft will now proceed to ground and flight tests, before delivery to JAL in early summer.
In total JAL has ordered 31 A350 XWB aircraft, comprising 18 A350-900s and 13 A350-1000s. The A350-900 will initially be operated on major domestic routes, with a three-class configuration seating 369 passengers.
The A350 XWB is the world’s most modern and eco-efficient aircraft family shaping the future of air travel. It is the long-range leader in the large widebody market (300 to 400+ seats). The A350 XWB offers by design unrivalled operational flexibility and efficiency for all market segments up to ultra-long haul (15,000 km).
The A350 XWB features the latest aerodynamic design, carbon fibre fuselage and wings, plus new fuel-efficient Rolls-Royce engines. Together, these latest technologies translate into unrivalled levels of operational efficiency, with a 25% reduction in fuel burn and emissions. The A350 XWB’s Airspace by Airbus cabin is the quietest of any twin-aisle and offers passengers and crews the most modern in-flight products for the most comfortable flying experience.
At the end of March 2019, the A350 XWB Family had received 890 firm
orders from 50 customers worldwide, making it one of the most successful
widebody aircraft ever.
(Reuters)
– Virgin Atlantic on Wednesday reported an annual pretax loss for the
second consecutive year, hit by a shaky economy, the higher costs of
fuel generated by a weaker British pound and problems with Rolls Royce’s
Trent engines.
The
airline, the 1980s brainchild of British billionaire Richard Branson,
fell back into the red in 2017 after three years of profits, as
competition intensified and the weakening of the pound added to already
rising fuel costs.
Best
known in Europe for the trans-Atlantic planes it flies with Air
France-KLM and Delta, Virgin said its loss before tax and exceptional
items was 26.1 million pounds ($34.12 million) for the year ended Dec.
31, compared to a loss of 49 million pounds in 2017.
Total
revenue rose 5.8 percent to 2.78 billion pounds, as passenger numbers
grew just under 5 percent to 5.4 million and revenue per customer rose
1.7 percent.
The
company said performance had suffered from economic uncertainty and the
weaker pound – which increases costs because fuel is priced in dollars –
as well as the well-documented problems of the Trent 1000 engines used
on its Boeing 787 jets.
“While
a loss is disappointing, our performance has improved in 2018 despite
challenging economic conditions and put us on a trajectory for growth
and return to profitability,” Chief Executive Officer Shai Weiss said in
a statement.
Rolls-Royce
on Wednesday agreed to an early inspection of some Trent 1000 TEN
engines by regulatory authorities, a week after Singapore Airlines
grounded two Boeing 787-10 jets fitted with the units.
British
Airways owner IAG in February chose Boeing 777-9s, rather than a
competing package from Airbus in part powered by Rolls, underlining the
risks to airlines from the engine issues.
Since
then the industry has been thrown into chaos by the grounding of
Boeing’s new 737 MAX planes after a second fatal crash within six
months.
The
pound fell 5.6 percent against the U.S. dollar, in 2018 as Britain
contended with the political and economic uncertainty generated by its
negotiations on leaving the European Union.
Finance
chief Tom Mackay said that while economic factors would continue to
challenge the carrier in the year ahead, Virgin Atlantic was in a strong
cash position.
The
results are the company’s first since its acquisition of troubled
regional airline Flybe for $2.8 million earlier this year, in a joint
bid with Stobart Group and Cyrus Capital.
($1 = 0.7649 pounds)
(Reporting by Noor Zainab Hussain and Pushkala Aripaka in Bengaluru; Editing by Anil D’Silva)
Uganda Airlines, the national carrier of Uganda,
has firmed up its order for two A330-800 airliners, the latest version
of the most popular A330 widebody airliner.
Fitted with the new Airspace by Airbus cabin, the
A330neo will bring a range of benefits to Uganda Airlines and its
customers, offering unrivalled efficiencies combined with the most
modern cabin.
Uganda Airlines plans to use the A330-800 to build its medium and
long-haul network with the aircraft offering cutting-edge technology
along with more efficient operations
Launched in July 2014, the A330neo Family is the new generation A330, comprising two versions: the A330-800 and A330-900 sharing 99 percent commonality. It builds on the proven economics, versatility and reliability of the A330 Family, while reducing fuel consumption by about 25 percent per seat versus previous generation competitors and increasing range by up to 1,500 nm compared to the majority of A330s in operation. The A330neo is powered by Rolls-Royce’s latest-generation Trent 7000 engines and features a new wing with increased span and new A350 XWB-inspired Sharklets. The cabin provides the comfort of the new Airspace amenities including state-of-the-art passenger inflight entertainment and Wifi connectivity systems, amongst others.
ANA becomes Japan’s first carrier with Airbus’ double-deck jetliner and joins airlines that use A380s to serve the Tokyo Narita – Honolulu route
Japan’s All
Nippon Airways (ANA) today took delivery of its initial A380, which will
serve the popular Japan-to-Hawaii routing – and is appropriately
painted in a special livery depicting the Hawaiian Green Sea Turtle,
also known as the Honu.
ANA becomes the world’s 15th operator – and Japan’s first – of this widebody passenger aircraft. It has ordered a total of three A380s.
Powered by Rolls-Royce Trent 900 engines, the jetliner features ANA’s very latest in-flight entertainment systems, as well as full connectivity in all classes. It will enable the airline to almost double the capacity between Japan and the U.S. island state of Hawaii, generating value for the airline.
As the world’s largest and most spacious passenger aircraft, the A380 will be operated on ANA’s popular Japan-to-Hawaii route.
“This marks a new milestone in our relationship
with ANA – our longest-standing customer in Japan,” said Tom Enders,
Airbus Chief Executive Officer, during today’s delivery ceremony at
Toulouse, France. “We are confident the A380 will be a huge success in
service with All Nippon Airways, and we remain committed to supporting
the airline’s A380 operation – as we will for all operators of this
magnificent aircraft.”
Each of ANA’s A380s will feature the special livery depicting the
Hawaiian Green Sea Turtle. The no. 1 aircraft is blue, the second will
be green and the third orange. This elaborate paint scheme covers a
surface of 3,600 square metres and took the Airbus team 21 days to
paint, using 16 different shades of colour.
With this character design of
Honu, All Nippon Airways aims to raise awareness about environmental
issues and contribute to saving sea turtles and the environment.
Shohei Hattori, ANA Corporate Planning Manager
“Customers around the world were asked to create
an attractive design to be painted on Japan’s first A380 as part of a
contest – and the Honu, a symbol of good luck and prosperity in Hawaii,
was among the numerous ideas,” explained Shohei Hattori, the ANA
Corporate Planning Manager.
Airbus’ longstanding relationship with Japan
The relationship between Airbus and Japan’s All
Nippon Airways began in 1986, when the airline placed its first order
for 20 single-aisle A320s, the first of which entered service in 1991. Since then, ANA has operated a fleet of A320 Family
aircraft, consistently ranking among the top Airbus operators for
technical performance and achieving more than 99.5% operational
reliability with its latest A321neo fleet.
In recent years, Airbus also extended its operator base in Japan with
ANA subsidiaries Peach Aviation and Vanilla Air, both of which
exclusively fly Airbus A320 Family aircraft.
At the end of 2018, Airbus reached a milestone with 100 of its aircraft in Japanese operators’ service, representing 20% of total fleet flying in the country – with a target to reach 30% by 2020, and 50% in the long term.
As the first Japanese
customer for Airbus’ double-deck jetliner, ANA’s no. 1 A380 bears the
representation of a Hawaiian turtle – and will be part of promotions to
save sea turtles and the environment.
The unique A380 experience
More than 230 A380s have been delivered to 15
airlines worldwide, with the jetliners operated on 120-plus routes and
60 destinations.
An estimated250 million passengers already have flown aboard
the double-deck aircraft – and people actively seek out A380 flights for
the unique travel experience. To assist passengers, Airbus created a
dedicated iflyA380 website, where travellers can search and book their preferred flights – which now also include those operated by ANA.
Some 50% of weekly global A380 flights take place in Asia-Pacific –
with flights performed within the region, to or from it, demonstrating
that the jetliner offers the best solution for traffic growth in Asia.
As the world’s largest and most spacious passenger aircraft, the A380 is a favourite among travellers, with unmatched comfort and wider seats. For airlines, the jetliner has the lowest cost per seat of any competing widebody, delivering comfort and economic benefits and maximising revenue. With passenger traffic doubling every 15 years, the A380 is the solution to transportation growth and airport congestion, carrying more people with fewer flights at lower cost and reduced emissions.
As the first Japanese customer for Airbus’ double-deck jetliner, ANA’s no. 1 A380 bears the representation of a Hawaiian turtle – and will be part of promotions to save sea turtles and the environment.
STARLUX Airlines of Taiwan has signed a firm order with Airbus for 17 widebody aircraft, comprising 12 A350-1000s and five A350-900s.
The new airline plans to deploy these aircraft on its premier long-haul services from Taipei to Europe and North America, as well as selected destinations within the Asia-Pacific region.
“We are very glad to sign the official purchase agreement today for Airbus widebodies. The A350’s combination of extra-long range capability, significantly lower operating costs and high passenger comfort were key factors in our decision,” K.W. Chang, Founder and Chairman of STARLUX Airlines said. “STARLUX is committed to becoming one of the best airlines in the world. We are positive that with the A350 XWB, we will be able to spread our wings to further destinations, bringing our best-in-class services to more people over the world in the near future.”
“What K. W. and STARLUX are proving is that when you start from a clean sheet, you make no compromises. Every STARLUX A350-1000 takes off 45 tonnes lighter than its alternative. Imagine the savings! And will fly up to 1,000 more miles than the alternative, enabling STARLUX to serve US-East Coast destinations nonstop! Imagine the extra market & revenue!” said Christian Scherer, Airbus Chief Commercial Officer. “Both the A350-1000 and A350-900 offer true long range capability, greater passenger comfort, yet all the economic benefits of fleet commonality. We salute STARLUX’s strategic choice with gratitude and we will be there to support their legitimate ambition.”
The A350 XWB is the world’s most modern and eco-efficient aircraft family shaping the future of air travel. It is the long-range leader in the large wide-body market (300 to 400+ seats). The A350 XWB offers by design unrivalled operational flexibility and efficiency for all market segments up to ultra-long haul (9,700 nm). It features the latest aerodynamic design, carbon fibre fuselage and wings, plus new fuel-efficient Rolls-Royce engines. Together, these latest technologies translate into unrivalled levels of operational efficiency, with a 25 per cent reduction in fuel burn and emissions. The A350 XWB’s Airspace by Airbus cabin is the quietest of any twin-aisle and offers passengers and crews the most modern in-flight products for the most comfortable flying experience.
At the end of February 2019, the A350 XWB Family had received 852 firm orders from 48 customers worldwide, making it one of the most successful wide-body aircraft ever.
(Reuters) – Boeing Co is indicating “full speed ahead” for a new midsized airplane in what would be the first all-new jet program for the world’s biggest planemaker in more than a decade, Air Lease Corp’s chief executive, John Plueger, said on Wednesday.
Boeing reiterated on Wednesday that it will make a decision in 2020 on whether to launch the plane, which aims to address the middle of the jet market between traditional narrowbody jets with one aisle and long-distance widebody planes. It can start seeking offers in 2019, subject to launch.
“Boeing is signalling full speed ahead but there’s still a lot to be decided in these programs,” Plueger said at a conference, noting the company had met with Boeing in Seattle on Friday.
In an emailed statement, Boeing said it is still working through the business case for the new jet, adding: “If we decide to offer the airplane and the market responds positively, we will proceed with a launch decision sometime in 2020.”
Air Lease, one of the largest aircraft lessors, said it sees interest in Boeing’s proposed mid-market aircraft from airlines, some of which are looking for longer range while others, such as Asian carriers, seek the lowest possible cost per seat kilometre.
Still, Boeing is taking a “thoughtful approach” to the potential project following a series of cost overruns and delays with its last jet program, the 787, and has yet to discuss possible pricing, Air Lease Executive Chairman Steven Udvar-Hazy said.
Air Lease will meet on Saturday with Airbus SE, which is preparing to counter the potential new jet by Boeing with a new version of its A321 and the larger A330neo.
While Boeing and Airbus have traditionally launched new jets alongside purchase commitments from airlines, interest by aircraft lessors like Air Lease is forming an increasingly important role in the decision-making process, industry sources have said.
Delta Air Lines Chief Executive Ed Bastian said on Monday that it is interested in a mid-market aircraft from Boeing to replace 200 757 and 767 aircraft over the next decade.
Last month, Rolls-Royce dropped out of the race to power Boeing’s planned jet, strengthening a leading position in the high-profile contest for a transatlantic venture involving General Electric Co and France’s Safran.
“Somebody had to drop out and the competition at this point is progressing normally,” Plueger said.
Pratt & Whitney is also a potential supplier for the new Boeing jet.
(Reporting by Tracy Rucinski in Chicago; Editing by Matthew Lewis)
Interest is rising for Boeing’s new 757 replacement jet!
LONDON
(Reuters) – Rolls-Royce dropped out of the race to power Boeing’s
planned mid-market aircraft on Thursday, saying it did not want to risk
more disruption for its airline customers by rushing out a product
without extensive testing.
The
move strengthens a leading position in the high-profile contest already
held by a transatlantic venture involving Rolls’ arch-rival General
Electric, industry sources said,
Britain’s
Rolls-Royce, which makes engines for large civil aircraft and military
planes, wants to avoid a repeat of the problems with its Trent 1000
engine that powers Boeing’s Dreamliner 787.
Chief
Executive Warren East said he had taken the “very difficult decision”
to withdraw from the Boeing competition because it couldn’t make the
development of its new UltraFan architecture fit the timetable for the
aircraft.
Boeing
has proposed launching a new mid-sized jetliner to fill a gap between
the narrow and wide-body aircraft, with airline operations beginning in
2025.
“If
you enter into service with an engine that is not sufficiently mature,
then you are almost inevitably going to run into lots of in-service
issues, lots of customer disruption and lots of incremental costs,” East
told reporters.
He
said, however, that Rolls was still committed to UltraFan, a major new
fuel-efficient architecture that will power wide-body jets towards the
back end of the next decade.
CFM
International — a joint venture between GE and France’s Safran — as
well as Pratt & Whitney are also potential suppliers for the new
Boeing jet.
Pratt
& Whitney recently re-entered the civil market for narrow-body jets
and wants to expand to larger ones, but has been hit by industrial
problems.
UNHAPPY CUSTOMERS
In
the nearer term, Rolls is still dealing with the costs and disruption
of fixing Trent 1000 engines caused by the poor durability of
components.
“On
this issue we have indeed turned the corner,” East said, although he
added that the level of customer disruption was still unacceptable.
It
raised the Trent 1000 charge to 790 million pounds from 554 million
pounds at the half year, contributing to a full-year operating loss of
1.16 billion pounds ($1.54 billion), and allocated another 100 million
pounds in cash to the problem.
The issue has damaged Rolls’ standing with its big customers.
British
Airways owner IAG said on Thursday it would order 18 Boeing 777-9s,
rather than a competing package from Airbus that industry sources said
included the A350, which is powered by Rolls.
“I
have been frustrated, largely with the performance of Rolls-Royce, not
so much with Airbus,” IAG Chief Executive Willie Walsh said.
East, however, said Rolls had an excellent relationship with BA and put the choice down to IAG’s fleet requirements.
“I am totally confident we will be continuing to be a major partner with BA for many, many years into the future,” he said.
East
said that aside from Trent 1000, the rest of the business was
performing well, although the large engine deliveries of 480 fell short
of its 500 target, in part due to the challenge of stepping up Trent
7000 production.
Shares in Rolls were trading down 3.4 percent at 950 pence, underperforming a 1 percent drop in the FTSE 100.
The
company reported a 8 percent rise in underlying revenue to 15.1 billion
pounds and a doubling of operating profit to 616 million pounds.
However,
changes in Rolls-Royce’s dollar-pound hedge book had a significant
impact on its results, and were in part responsible for a reported
full-year loss of 2.9 billion pounds.
(Reporting by Paul Sandle, Additional reporting by Tim Hepher; Editing by Edmund Blair and Keith Weir)
-EBIT before special items(1) up 42% year-over-year to more than $1.0B on revenues of $16.2B for the year; EBIT increased 235% year-over-year to $1.0B
-2018 EBIT margin before special items(1) up 180 bps year-over-year to 6.3%; EBIT margin of 6.2%
-Full year free cash flow(1) of $182M, comprising proceeds from certain transactions, including $1.0B of cash generation in the fourth quarter; full year cash flows from operating activities of $597M
-Strong backlog growth at Business Aircraft and Transportation, with full year book-to-bill ratios(2) of 1.1 at both segments, and a consolidated backlog of $53.1B
-2019 guidance affirmed, clear path to achieve 2020 objectives
Bombardier (TSX: BBD.B) today reported its fourth quarter and full year 2018 results, highlighting solid margin growth, improved cash flows and continued progress executing its turnaround plan. The successful entry-into-service of the Global 7500 business jet in the fourth quarter also marked the completion of Bombardier’s heavy investment cycle, a key milestone in the company’s turnaround plan.
“2018 was a year of solid progress,” said Alain Bellemare, President and Chief Executive Officer, Bombardier Inc. “We continued to strengthen our business and set a strong foundation for growth. A foundation that includes a refreshed portfolio of best-in-class products, industry-leading backlogs and a more streamlined cost structure, all of which gives us a clear path to achieve our 2020 objectives.”
“As we begin the fourth year of our turnaround journey, Bombardier is a much stronger company,” continued Bellemare. “Our major program risks are retired, our heavy investment cycle is behind us and our franchises are well positioned for growth. For 2019, we are focused on flawless execution of our rail projects, the ramp-up of the Global 7500 and entry-into-service of the Global 5500 and Global 6500. We will also continue to drive financial performance through disciplined capital allocation and improved productivity and efficiency across the organization.”
Bombardier’s 2018 consolidated revenues reached $16.2 billion, reflecting 3% average year-over-year growth across Transportation, Business Aircraft and Aerostructures, excluding currency impact. Book-to-bill ratios(2) at Transportation and Business Aircraft both equaled 1.1 for the year, demonstrating strong demand for Bombardier’s products and services. Bombardier’s consolidated backlog reached $53.1 billion at the end of 2018, supporting future growth targets.
EBIT before special items continued to improve in 2018, increasing 42% year-over-year from $725 million to more than $1.0 billion, the top-end of the company’s guidance. The 6.3% EBIT margin before special items in 2018 represents a strong 330 bps increase since the start of the turnaround plan in 2015, well above the 5-6% range originally targeted. On a reported basis, EBIT increased 235% year-over-year to $1.0 billion, representing a margin of 6.2%.
Bombardier generated $1.0 billion of free cash flow in the fourth quarter of 2018. Full year free cash flow generation equaled $182 million, at the high end of the company’s revised guidance. This amount includes aggregate net proceeds of approximately $750 million from the sale of the Downsview property and the monetization of royalties associated with the previously announced CAE transaction. Cash flows from operating activities amounted to $597 million for the full year, and to $1.3 billion in the fourth quarter. Bombardier ended the year in a solid cash position, with $3.2 billion in cash and cash equivalents.
Selected results
SEGMENTED RESULTS AND HIGHLIGHTS
Business Aircraft
Business Aircraft achieved a historical milestone in December 2018 with the on plan service entry of the largest and longest range industry flagship Global 7500 aircraft. With a strong backlog and unsurpassed performance in its category, the Global 7500 is expected to be Business Aircraft’s key growth driver for years to come.
Revenues, EBIT before special items and deliveries were in line with guidance for 2018.
The segment achieved industry leading deliveries at 137 aircraft for 2018, including 42 Global, 83 Challenger and 12 Learjet.
Continued progress on the aftermarket strategy drove a 14.3% revenue increase year-over-year. Further expansion of our service network was also announced with the groundbreaking for a new centre in Miami, Florida to service U.S. and Latin American customers.
During the year, Business Aircraft unveiled the new Global 5500 and Global 6500 aircraft featuring an all-new Rolls-Royce engine and a newly optimized wing, increasing the aircraft range and fuel burn performance. With flight testing at advanced stages, these performance-leading aircraft are expected to enter into service at the end of 2019.
Commercial Aircraft
In 2018, Commercial Aircraft significantly reshaped its portfolio, focusing on the CRJ Series program and its aftermarket business, while also participating in the growth of the A220 through its partnership with Airbus:
The C Series Partnership (CSALP) with Airbus closed on July 1, 2018, bringing together two complementary product lines and the benefit of Airbus’ global reach, creating significant value potential for the newly rebranded A220.
A definitive agreement was reached with Longview Aircraft Company of Canada Limited for the sale of the Q Series aircraft program assets, including aftermarket operations and assets, for gross proceeds of approximately $300 million, on November 7, 2018. The transaction is expected to close by the second half of 2019, subject to customary closing conditions and regulatory approvals. Net proceeds for this transaction are expected at approximately $250 million net of fees, liabilities and normal closing adjustments.
Revenues and aircraft deliveries for 2018 were in line with guidance on the basis of the deconsolidation of CSALP results from Commercial Aircraft since July 1, 2018.
EBIT loss before special items(11) was $157 million reflecting for the most part losses on the C Series program in the first half of the year and the post-closing CSALP equity pickup. EBIT loss of $755 million includes a $616 million pre-tax accounting charge related to the closing of the CSALP transaction.
Commercial Aircraft continues to actively participate in the regional aircraft market with the established scope-compliant CRJ Series aircraft, with a focus on reducing costs and increasing volumes while optimizing the aftermarket for the large installed base in service around the world today. As the focus is to return the program to profitability, Bombardier also announced in 2018 it is exploring strategic options for the program.
Aerostructures and Engineering Services
Aerostructures and Engineering Services is positioned as a key supplier on early life cycle growth programs, including the new A220 and Global 7500 aircraft, expected to drive sustainable growth.
In 2018, the segment revenues grew 21% year-over-year to $2.0 billion in line with guidance.
Focused execution during the ramp-up of these programs and a one-time favorable item (approximately 50 bps) associated with the closing of the C Series Partnership have enabled to deliver 9.6% EBIT before special items, above its guidance. EBIT margin for the segment was 7.5%.
On February 6, 2019, the Corporation acquired the Global 7500 aircraft wing program operations and assets from Triumph Group Inc., for a nominal cash consideration. This transaction is expected to strengthen Bombardier’s position as a leading aerostructures manufacturer, to enable the company to leverage its extensive technical expertise to support the ramp-up of the Global 7500 aircraft, and to enhance its long-term success. Bombardier will continue to operate the production line and integrate the employees currently supporting the program at Triumph’s Red Oak, Texas facility.
On February 7, 2019, Paul Sislian was appointed President, Aerostructures and Engineering Services. Paul brings more than 20 years of aerospace and industrial experience, including serving most recently as Chief Operating Officer for Bombardier Business Aircraft.
Transportation
On February 7, 2019, Danny Di Perna was appointed President, Bombardier Transportation. Danny brings more than 30 years of industrial experience to this new role. He has a proven record of success leading complex industrial projects and organizations, driving operational efficiency and improving quality. Most recently, Danny led Bombardier’s Aerostructures and Engineering Services segment.
In 2018, Transportation recorded orders totaling $9.9 billion, fueled by a $3.3 billion order intake in the fourth quarter. Book-to-bill(2) reached 1.5 for the fourth quarter, resulting in a 1.1 ratio for the full year, continuing to position the segment for growth in revenues and profitability, supported by strong industry fundamentals.
Order intake for the year reflects project wins across geographies, with notable contract awards in Europe, led by SNCF’s repeat order in France, in Asia led by the Singapore Metro contract, and North America with Airport and Mass transit mobility solutions for Phoenix and Los Angeles.
The backlog reached $34.5 billion as at December 31, 2018. The backlog growth (excluding currency fluctuations) was supported by a stronger mix of platform projects and increasing signalling and service contract orders, consistent with Transportation’s strategy to increase speed-to-market; provide customers with end-to-end solutions; de-risk project execution while also growing margins.
Subsequent to the fourth quarter, in January 2019, Transportation was awarded a contract to supply 113 new generation passenger rail cars valued at $669 million with options for up to 886 additional cars, by the New Jersey Transit Corporation.
Financial performance for 2018 positions Transportation to reach 2019 guidance:
Revenues grew 4% year-over-year to $8.9 billion, in line with guidance, supported by a favourable currency impact in the first half of the year (2% growth excluding currency impact). Services and signalling grew to over 34% of revenues for the year, as increasing focus turns to integrated customer solutions.
EBIT before special items grew to $750 million for the year, representing an 8.4% margin (EBIT of $774 million, or 8.7% margin). Fourth quarter margins before special items were 7.7% (10.9% EBIT margin), as a result of contract estimate adjustments largely associated with a legacy project, resulting in full year margins before special items, slightly below the 8.5% guidance.
As discussed at the Company’s December 2018 Investor Day, Transportation continues to advance a number of legacy projects. The Company has plans in place and is taking actions to finalize system integration, obtain homologation and align delivery schedules with customers. Bombardier expects to substantially complete deliveries on most of these projects and significantly recover working capital through 2019.
As the portfolio continues to improve, Transportation anticipates growing EBIT margins before special items to approximately 9% for 2019, in line with guidance.
CDPQ Investment in BT Holdco
The Company also announced that Transportation’s results in 2018 did not reach the performance targets underlying Caisse de dépôt et placement du Québec’s (CDPQ) investment in BT Holdco. Accordingly, for the 12-month period starting on February 12, 2019, Bombardier’s percentage of ownership on conversion of CDPQ’s shares will decrease by 2.5%, returning to the original 70%; and the preference return entitlement rate on liquidation of its shares will increase from 7.5% to 9.5% for this period. Any dividends paid by BT Holdco to its shareholders during this period will be distributed on the basis of each shareholder’s percentage of ownership upon conversion, being 70% for Bombardier and 30% for CDPQ. These adjustments will become effective once the audited consolidated financial statements of BT Holdco are duly approved by its board of directors.
Headquartered in Montréal, Canada, Bombardier has production and engineering sites in 28 countries across the segments of Transportation, Business Aircraft, Commercial Aircraft and Aerostructures and Engineering Services. Bombardier shares are traded on the Toronto Stock Exchange (BBD). In the fiscal year ended December 31, 2018, Bombardier posted revenues of $16.2 billion. News and information are available at bombardier.com or follow us on Twitter @Bombardier.
Airbus acknowledged reports last Thursday that Quantas has cancelled an order for its 8 remaining A380 aircraft. The announcement comes on the heels of Emirates re-evaluating its decision to add on to its remaining Super Jumbo order book.
Qantas Airlines of Australia confirmed it would not take any more of the world’s largest airplane, operating a fleet of 12 aircraft, instead of the 20 it had originally ordered. This news comes on the heels of Airbus’ largest A380 customer Emirates beginning discussions with Airbus over the possibility of changing some, or all, of its remaining A380 orders to smaller A350 or A330neo models after failing to secure an engine contract from Rolls-Royce for the last A380 order it placed.
Airbus has declined to comment on the future of the A380 at this time, but reports indicate that an announcement could come as soon as this Thursday.
Airbus also reported the cancellation of an order for five of its smallest aircraft, the 110-seat A220-100. The identity of the A220 buyer was not disclosed, but is widely believed to be the Swiss-based business charter carrier PrivatAir, which filed for insolvency at the end of 2018. PrivatAir had placed an ordered for 5 of the type, the Canadian Bombardier CS100 at the time of the order, in early 2012.
PARIS/DUBAI (Reuters) – Dubai’s Emirates is exploring switching some orders for the world’s largest jetliner, the Airbus A380, to the smaller A350 in a move raising new doubts about the future of Europe’s superjumbo, people familiar with the matter said.
The Gulf carrier, which has invested tens of billions of dollars in more than 100 A380s, has been struggling to finalise a deal to buy another 36 to keep assembly lines open, due to differences with engine maker Rolls-Royce.
Now, Airbus is looking closely at closing A380 factories sooner than expected as part of a reshuffle of orders, with Chief Executive Tom Enders unlikely to leave the situation unresolved when his mandate ends in April, they said.
A person familiar with the matter said Airbus was looking “extremely seriously” at setting the timetable for a shutdown but said no decision had been taken.
Airbus said in a statement after Reuters first published news of the talks that it “confirms it is in discussions with Emirates airline in relation to its A380 contract”. But it said details of negotiations were confidential.
Emirates and Rolls-Royce declined to comment.
Emirates announced the deal for up to 36 aircraft worth as much as $16 billion (£12 billion) at list prices a year ago, throwing a lifeline to the programme’s roughly 3,000 workers and securing its future for at least another decade.
The airline is an ardent supporter of the jet, which was designed with luxury features like bars and showers.
But sales of four-engined planes are tumbling as many airlines switch to smaller twin-engined jets like the A350 and Boeing 777 due to improvements in range and efficiency.
A year-long impasse between Emirates and Rolls-Royce over shortfalls in fuel savings has so far blocked the order.
Airbus is trying to broker a complex workaround which could see Emirates take smaller jets also powered by Rolls-Royce while it tries to secure homes for as many A380s as possible, with British Airways recently expressing interest.
Airbus has dangled the prospect of closing A380 production before, and industry sources say such manoeuvres can be a negotiating tactic to force the feuding parties to agree.
But time is running out for the A380 with few airlines willing to spend the sums invested by Emirates, which has made it a backbone of its global network alongside the Boeing 777.
The production line is “untenable”, a senior industry source said
A decision by Emirates to order the A350 would offer a respite for Airbus and its main engine partner Rolls-Royce after the Gulf carrier axed an order for the A380 in 2014.
Airbus and Rolls are keen to maintain a foothold with the Gulf carrier and prevent Boeing filling the gap with more of its General Electric-powered 777s.
(Reporting by Tim Hepher and Alexander Cornwell; Editing by Michel Rose and Edmund Blair)
