Swedish electric airplane maker Heart Aerospace and Honeywell, a leader in aerospace technology, have announced a collaboration to integrate Honeywell’s next-generation flight control system into the new ES-30 regional electric airplane.
Honeywell International Inc (NASDAQ: HON) was selected by Heart Aerospace for the Joint Definition Phase of Heart’s ES-30 airplane, and the goal, once the phase has been completed successfully, is to fully integrate Honeywell’s compact Fly-by-Wire system into development for production.
Honeywell’s next-generation compact Fly-by-Wire system is in an advanced stage of development on multiple aircraft, and its functions are adaptable to the ES-30, allowing Heart to bring its airplane to market quickly and cost-effectively.
The ES-30 is a regional electric airplane with a 30-passenger standard seating capacity and is driven by electric motors powered by batteries. It will have a fully electric zero-emissions range of 200 kilometers, an extended hybrid range of 400 kilometers with 30 passengers, and flexibility to fly up to 800 kilometers with 25 passengers, all with typical airline reserves.
Heart Aerospace has 250 firm orders for the ES-30, with options and purchase rights for an additional 120 planes.
Last week, Tesla Energy Ventures, a new subsidiary of electric car maker Tesla Inc. (Nasdaq: TSLA), filed an application to become a retail electricity provider in the state of Texas. According to reports, the company plans to sell electricity drawn from the grid to customers and from its battery storage products. Its grid transaction software may also enable customers for its solar panels to sell excess electricity back to the grid.
OSLO (Reuters) – Norwegian Air <NAS.OL> has cancelled orders for 97 Boeing <BA.N> aircraft and will claim compensation from the U.S. plane maker for the grounding of the 737 MAX and for 787 engine troubles that hit its bottom line, the Oslo-based carrier said on Monday.
The airline cancelled 92 of the 737 MAX jets, five 787 Dreamliners and so-called GoldCare service agreements related to both aircraft, just as Boeing on Monday began a crucial set of flight tests of the 737 MAX in an effort to gain regulatory approval for it to return to the skies.
“Norwegian has in addition filed a legal claim seeking the return of pre-delivery payments related to the aircraft and compensation for the company’s losses related to the grounding of the 737 MAX and engine issues on the 787,” the airline said.
Norwegian did not specify the amount it would seek to claim from Boeing, which it had been in talks with about compensation, and was not immediately available for comment.
Boeing said it was working with Norwegian on a path forward in a challenging time as it was with other operators but it would not comment on commercial discussions.
The problematic Trent 1000 engines, used on the Dreamliners, were made by Rolls-Royce <RR.L>, which Norwegian has been in a dialogue with about compensation. Monday’s statement did not say whether Norwegian would file a legal claim against Rolls-Royce.
The European budget carrier, which revolutionised transatlantic travel by offering cheap fares, was struggling before the COVID-19 pandemic brought the airline industry to its knees.
One reason was the grounding of the 737 MAX in March 2019 following the second of two fatal crashes that together killed 346 people. Norwegian had 18 MAX passenger jets in its 163-aircraft fleet at the time.
Originally a small regional airline in Scandinavia, Norwegian made its breakthrough on the global stage with a multi-year order in 2012 for up to 372 aircraft, of which 222 were from Boeing and 150 from Airbus <AIR.PA>.
(Reporting by Gwladys Fouche and Terje Solsvik; Additional reporting by Eric M. Johnson in Seattle; Editing by Leslie Adler and Christopher Cushing)
FILE PHOTO: Norwegian Air Sweden Boeing 737-800 plane SE-RRY lands in Riga International Airport in Riga
(Reuters) – Boeing Co suppliers Hexcel Corp and Woodward Inc on Monday called off their planned all-stock merger as widespread travel bans to curb the coronavirus pummels demand in the aerospace sector.
The companies, which make and supply aircraft parts, had agreed to a merger in January in a $6.4 billion deal.
“Although we are disappointed with this outcome, we are confident this is the right decision for our customers, our shareholders, and our employees,” the companies said in a joint statement.
The market rout triggered by the coronavirus pandemic and the resulting economic downturn has thrown a wrench into corporate deal making. Last month U.S. printer maker Xerox Holdings Corp walked away from its $35 billion hostile cash-and-stock bid for HP Inc.
Boeing, which halted the production of its grounded 737 MAX aircraft in January, said on Sunday it would extend the suspension of production at its Washington state facilities until further notice.
Boeing is Hexcel’s second-biggest customer, accounting for a quarter of the company’s annual sales. Hexcel also supplies Airbus SE.
Woodward gets about 15% of its annual sales from Boeing, its biggest customer.
(Reporting by Ankit Ajmera in Bengaluru; Editing by Shounak Dasgupta and Devika Syamnath)
(Reuters) – British aero-engine maker Rolls-Royce will abandon its targets on profits, cash and deliveries, and suspend its dividend, as airlines around the world ground planes due to the coronavirus outbreak, the Financial Times reported late on Sunday.
Rolls-Royce is also aiming to announce new credit facilities in excess of 1 billion pounds ($1.22 billion) to bolster liquidity, the newspaper said https://on.ft.com/2ULsL7q.
Rolls-Royce, which makes engines for large civil and military planes, has been hit hard by the pandemic as its airline customers park hundreds of planes.
In March, engine flying hours were down by about 40%, the newspaper said, citing a source. The company is paid by airlines based on how many hours its engines fly.
At the end of February, Rolls Royce had forecast 2020 free cash flow of 1 billion pounds, excluding any material impact from COVID-19. The group will ditch that pledge, the FT said.
The dividend payment of 11.7 pence per share, which has been frozen since 2016, will also be suspended, the newspaper added.
Rolls-Royce declined to comment.
In addition, the FT said the company on Monday will reopen its civil aerospace facilities in the UK with a fraction of the normal workforce, after suspending operations in March.
The company could also eventually furlough some 50% of its 7,500 UK shop-floor workers, with wages supported by government subsidy, two sources told the newspaper.
(Reporting by Bhargav Acharya in Bengaluru; Editing by Daniel Wallis and Richard Pullin)
Rolls Royce engine of the first Fiji Airways A350 XWB airliner is seen at the aircraft builder’s headquarters of Airbus in Colomiers near Toulouse
MONTREAL/PARIS (Reuters) – Europe’s Airbus SE <EADSY> is likely to acquire Canadian plane and train maker Bombardier Inc’s <BBD-B.TO> remaining stake in the A220 passenger jet program, two industry sources said.
A deal for Airbus to buy the 33.58% share in the program was widely expected after Bombardier said in January it was reviewing the stake in the joint venture. Barring surprises, a deal is expected next week ahead of both companies’ earnings reports on Feb. 13, the sources added.
Airbus and Bombardier both declined to comment. The terms of a potential deal that would mark Bombardier’s exit from commercial aviation were unclear.
Bombardier, which is weighing additional asset sales, faced a cash crunch in 2015 due to its high-stakes bet on the technologically advanced narrowbody.
Bombardier shares closed up 2.8%.
Montreal-based Bombardier ceded control of the program to Airbus in 2018 for a token C$1 as part of broader efforts to improve its finances. It retained a minority stake alongside the Canadian province of Quebec.
Bombardier had warned the program would require additional cash to ramp up production, and could be subject to a writedown, as it faces higher-than-expected costs in its rail division and more than $9 billion of debt.
Since Airbus took over the program, the A220 has seen a sharp pickup in sales to 658 orders as of Jan. 31. But it has not seen the cost declines expected from Airbus applying its greater purchasing power with suppliers, one of the sources said.
A deal would leave Airbus to shoulder additional investments required by the plane program.
“Airbus did not particularly want to do this at this time, but is presented with little choice if Bombardier is pulling back,” the second source said.
Airbus, with a 50.6% stake in the program, delivered 48 A220 jets in 2019 and is ramping up production toward its maximum monthly capacity of 10 jets in Mirabel, Quebec, and four planes at a second line in Alabama by mid-decade.
Airbus Chief Commercial Officer Christian Scherer told Reuters in January the company was progressing toward its target of a double-digit percentage reduction in the A220’s production costs.
Quebec, with a 16.36% stake in the A220 program, would not invest further. Rather, it is trying to protect the program’s estimated 2,700 jobs, along with the province’s $1 billion investment in the program, Economy Minister Pierre Fitzgibbon said on Monday.
“We put $1 billion in it and that’s enough.”
(Reporting by Allison Lampert and Tim Hepher in Paris; Editing by Diane Craft, David Gregorio and Richard Chang)
Volkswagen logo is seen on a Teramont X SUV displayed at the second media day for the Shanghai auto show in Shanghai
HONG KONG/BEIJING (Reuters) – Volkswagen AG <VWAGY> is set to take a 20% stake in Chinese electric vehicle battery maker Guoxuan High-tech Co Ltd, two sources told Reuters, as the German firm accelerates its electric push into the world’s largest auto market.
The deal would mark Volkswagen’s first direct ownership in a Chinese battery maker and comes as the Wolfsburg-based automaker strives to meet a goal of selling 1.5 million new energy vehicles (NEVs) a year in China by 2025, including plug-in hybrid cars.
The top foreign automaker in China plans to acquire the stake in Shenzhen-listed Guoxuan via a discounted private share placement in the coming weeks, the two sources with knowledge of the matter said. Based on Guoxuan’s market capitalization of $2.8 billion, a 20% stake in the company at present is worth about $560 million.
The deal’s details have been mostly finalized and the two firms are waiting for new Chinese regulatory rules on private share placements that will provide a more flexible pricing mechanism and shorter lock-up periods for majority shareholders, said one of the people, speaking on condition of anonymity.
After the stake purchase, Volkswagen will become the battery maker’s second-largest shareholder with a 20% stake, behind Zhuhai Guoxuan Trading Ltd, a firm controlled by Guoxuan’s founder Li Zhen, which currently holds 25%.
Guoxuan is among a swathe of mid-tier Chinese battery makers behind CATL and BYD. It is based in China’s eastern city of Hefei, where Volkswagen is also building electric vehicles with JAC Motor, one of a number of its Chinese joint venture partners.
A third source, who declined to be named due to the sensitivity of the matter, said Volkswagen has long wanted to control a battery maker to better manage its supply chain.
Volkswagen declined to comment. Guoxuan and the China Securities Regulatory Commission did not immediately respond to requests for comment.
To achieve its NEV sales goal in China, Volkswagen has built a new $2.5 billion electric vehicle plant with partner SAIC Motor that will have annual output capacity of 300,000 cars and is also revamping manufacturing facilities in China’s southeastern city of Foshan to build electric cars with partner FAW Group.
Volkswagen has also identified CATL as a strategic supplier and Volkswagen board member Stefan Sommer told Reuters in July last year that it could even build its own battery cell manufacturing plants in China.
“By holding a stake in the top Chinese battery makers, carmakers can gain more bargaining power on battery prices,” said Yale Zhang, managing director of Shanghai-based consultancy AutoForesight. “Foreign carmakers are now catching up with their Chinese counterparts on securing battery supplies in China.”
Volkswagen’s rivals in China include Tesla, which earlier this month began delivering cars from its $2 billion factory in China. The U.S. electric car maker eventually plans to manufacture 250,000 vehicles a year in the plant’s first phase.
China has been a keen supporter of NEV – pure battery electric, hybrid and plug-in hybrids – and has started implementing NEV sales quota requirements for automakers.
However, cuts to subsidies have dealt the market a blow, with NEV sales contracting for the first time last year. Sales this year are likely to be flat or rise only slightly, according to China’s top auto industry association.
(Reporting by Julie Zhu in Hong Kong and Yilei Sun in Beijing; Additional reporting by Zhang Yan and Zhang Xiaochong in Beijing; Editing by Brenda Goh and Richard Pullin)
Aston Martin (ARGGY) just can’t help but outdo itself. From its entry in Le Mans, to building James Bond cars that actually work, to Aston Martin-themed motorcycles, and even embracing the manual gearbox after everyone else abandoned it—it seems that the British luxury marque is always looking to do the unexpected.
For its next trick, Aston Martin announced a team-up with airplane and helicopter maker Airbus to unveil the ACH130 Aston Martin Edition, a stylish helicopter embellished with four different interior and exterior designs provided by Aston Martin.
Exterior options include Stirling Green, Xenon Grey, Ultramarine Black, and a color simply dubbed Arizona. For the cabin, buyers get to choose between Oxford Tan, Cormorant, Ivory, and Pure Black. Matching leather and Pure Black ultra-suede makes up the rest of the interior. Aston Martin badging is embossed on the leather headrests to further distinguish this special edition for the standard ACH130.
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.
MILAN (Reuters) – Italian tax authorities believe that Fiat Chrysler Automobiles <FCAU> underestimated the value of its U.S. business by 5.1 billion euros following Fiat’s phased acquisition of Chrysler, according to a company filing and a source close to the matter.
The audit, which concerns transactions dating back to 2014, could result in FCA having to pay back taxes for $1.5 billion, the source added, confirming a report by Bloomberg.
FCA said in its third-quarter report that the tax authorities had issued to the company a final audit report in October this year “which, if confirmed in the final audit assessment, could result in a material proposed tax adjustment related to the October 12, 2014 merger of Fiat SpA into FCA NV.”
It said the issuance of a final audit report starts a 60-day negotiation period, which ends with the issuance of a final audit assessment expected to be received by the end of December 2019.
“The company believes that its tax position with respect to the merger is fully supported by both the facts and applicable tax law and will vigorously defend its position,” it said in the third-quarter report.
A spokesman for Italy’s tax agency declined to comment.
“At this time, we cannot predict whether any settlement may be reached or if no settlement is reached, the outcome of any litigation. As such, we are unable to reliably evaluate the likelihood that a loss will be incurred or estimate a range of possible loss,” Fiat said.
News of the tax probe comes at a delicate time for Fiat Chrysler, which is finalizing talks with PSA, the maker of Peugeot and Citroen, over a planned $50 billion merger to create the world’s fourth-largest automaker.
(Reporting by Silvia Aloisi in Milan; Editing by Anil D’Silva)
