Airbus expects to sell about 800 aircraft to Latin American

airlines over the next twodecades, said Rafael Alonso, the group’s vice-president of customer affairs for LatinAmerica, the Caribbean and Spain. Demand for commercial aircraft in the region over theperiod should reach 1,500 units, according to Airbus’s estimates. Mr Alonso pointed out that“growth of air traffic in Latin America is faster than the average”, at about 6 %, compared withestimates of 4.5 % worldwide. Some countries in Latin America are growing at a 20 % rate,or even 30 %, like Chile and Colombia. Dow Jones Newswires (13/03)

The aeronautics sector boosts the French economy

as one of its top growth levers.Aeronautics has become the second-largest growth sector in France, after the naval industry.According to Credit Lyonnais (LCL) estimates, deliveries rose by more than 7 % in 2007 andshould remain at that level this year. For the past three years, Boeing and Airbus –as well asbusiness and regional jet manufacturers- have won record orders, thus leading to asignificant production increase at suppliers. This trend will continue in 2008, said DaherLhotellier CEO and Gifas member Francois Lepinoy. Aircelle CEO Jean-Pierre Cojeanechoes that the group’s activity will explode, notably thanks to the A380. Airbus will deliver13 of its superjumbos this year.
La Tribune

Boeing had won 275 orders through March 11,

according to information posted on thegroup’s website. The plane maker has listed orders for 85 aircraft from unidentifiedcustomers, worth about $ 11.2Bn at list prices, including 35 of its 787s, 40 of its 737s and 10of its 777s.
Bloomberg (13/03)

The landscape of regional aviation is getting more complex,

with the arrival of newcompetitors from Japan, China or Russia. The three established players –Bombardier,Embraer and ATR- see their order books grow and market opportunities develop in the US,Europe and, above all, Asia-Pacific. The industry estimates that 10 % of global demand forregional aircraft will come from China within 20 years. This is why Chinese manufacturer AvicI is pushing into this segment, with its ARJ 21, in an effort to fulfil the country’s needs itself.Russia, with its SuperJet 100, and more recently Japan, with its MRJ, are pursuing the samestrategy.
Air & Cosmos

Good results reported by Thales in 2007

are due to a successful strategy overseen by the group’s CEO, Denis Ranque. This strategy is based on three pillars: balance between three relevant businesses (aerospace, defence, andsecurity); “multi-domestic” international presence; and value enhancement (from a meresupplier to a major prime contractor). Air & Cosmos

Bremen-based OHB Technology is pursuing talks with Airbus

over the takeover of the plane maker’s German sites in Varel and Nordenham. The groupwas also picked as the favourite bidder for the EADS site in Augsburg. The conclusion ofnegotiations is expected for the summer. OHB is to be the technology leader in the newlyfoundedjoint venture. However, its shares are yet to be determined. EADS will remainshareholder for a while, together with a financial investor.
Augsburger Allgemeine Zeitung,Suddeutsche Zeitung

US Navy retired admiral James Lyons writes that

the ties between EADS and Russia are troubling in the context of the tankercontract award. James Lyons recalls that the Russian government acquired a 5 % stake inEADS in 2006 through state-controlled bank VTB. Later, Kremlin officials asserted that theywould seek a role in the company’s management and that the government intended to lift itsholding to up to 20 % of the group’s capital. The Moscow-EADS relation could give Russiaaccess to sensitive Western technology developed or acquired by EADS, writes J. Lyons.Hence, the Pentagon and congressional investigators might want to figure out theimplications of Russia’s current and future role in EADS and the potential impact of theKremlin on EADS’s ability to fulfil its contractual commitments, he concludes.
The WashingtonTimes (13/03)

The US tanker contract award to EADS remains under heavy attack

from lawmakers and trade unions. Supporting Boeing’s move this week, the UAWunion (more than 1 million members across the aerospace, automotive, farming and otherindustries) also filed an attack against the Pentagon’s decision. “Why should our taxes beused to give work to Europe and then subsidise a new plant when we already have theplants and workers that can do the job?” asked Ron Gettelfinger, president of the tradeunion. In this tense context, Northrop Grumman CEO Ronald Sugar told the AssociatedPress that Congress would undermine the entire US government procurement process if ittried to block the contract. “It would discourage companies from making significantinvestments to compete and

Thomas Enders urges the global aviation industry

to “cometogether and move to the forefront of eco-efficiency”, in a comment piece in TheGuardian. He writes, “It is essential that we rise to the environmental challenge or, as anindustry, we can fully expect that regulatory authorities and governments will take mattersinto their own hands”. Mr Enders suggests that the industry’s focus should be on acceleratingthe use of new technologies in aircraft manufacturing, encouraging fuel-efficient operationsby airlines, promoting efficient infrastructure and stimulating innovation with economicincentives. He mentions the recent A380 demonstration flight with GTL synthetic fuel andVirgin’s first biofuel flight, describing these tests as “just a step along the way”. Mr Enderssays “there are many other steps that need to be taken, and a concerted push will be needed–particularly in transnational research and technology- from the whole industry”.
AFP (13/03),The Guardian (13/03)

Louis Gallois comments on EADS’s annual results.

“Clearly they are not satisfactory”, he says, adding that the year 2007 put an end totroubles of the past (with the A380, A350, and A400M) and prepared EADS for the future.The dollar remains a challenge for the group: “We are going to diversify our portfolio withactivities less exposed to the US currency”. This is why the group also seeks midsizeacquisitions in the US to expand its production base there. “If we want an access to the USmarket, we need to be more present in this country at the industrial level”. Mr Galloisreiterates previsions that EADS will reach a production peak around 2011/2012, even if theongoing financial crisis in the US “is serious”. “We have an extremely abundant order book,[…] which allows us to offset a temporary crisis”. Besides, adds Mr Gallois, “the Asian marketremains very active”.

German aerospace supplier MTU Aero Engines

has a new CEO: Egon Behle. Mr Behleis expected to focus on cost reductions, in spite of the group’s good growth perspectives.The company faces the challenge of the weak dollar, though Mr Behle said he hoped to seethe US currency resume strength by 2010. Like EADS, the CEO of MTU says he is notopposed to the idea of takeovers in the US in order to be better protected against currencyfluctuations. Suddeutsche Zeitung points out that MTU’s largest project at the moment is theTP400 engine, the first of which have been delivered to Airbus for further tests. SuddeutscheZeitung, Die Welt