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UPDATE 
Week ending January 24, 1999
+++ BAe snaps up Marconi from GEC +++ Europe reacts to British Aerospace deal +++ Eurocopter reports good results for 1998 +++ Kosovo crisis: NATO builds up force +++ Eight airlines interested in buying into South African Airways +++ Boeing sells light helicopter lines +++ Ukraine still hopes on An-70 for NATO +++ News in brief +++

BAe snaps up Marconi from GEC
British Aerospace zieht Britische Fusion vor

On January 19, British Aerospace and GEC announced that they have reached agreement on the principal terms of a proposed reconstruction which will involve the separation from GEC of Marconi Electronic Systems and its merger with British Aerospace. The transaction places an enterprise value of more than #7.7 billion on Marconi Electronic Systems. The deal is subject, amongst other things, to the execution of a definitive transaction agreement.
British Aerospace thinks the merger will bolster its position as a world class aerospace and defence company, which is expected to be the cornerstone for further consolidation of this industry in Europe. British Aerospace intends to continue discussions with other potential European partners to achieve this as envisaged by the tri-partite intergovernmental declaration made in December 1997.
The Merger is expected to result in annual cost savings in excess of #275 million (including #25 million representing New British Aerospace's share of cost savings in joint ventures) within three full financial years of completion of the transactions (year ending 31 December 2002). The non-recurring cost of achieving these savings is expected to be approximately #200 million over the same period.
Sir Richard Evans, Chairman of British Aerospace, said: "This merger represents an important step in the restructuring of the aerospace and defence industry in Europe. The combination of these businesses creates a company with unrivalled global reach, world leading technology and the strength to compete at all levels in the world markets".

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Europe reacts to British Aerospace deal
Zwiespältige Reaktionen nach dem BAe/GEC-Abkommen

Not surprisingly, the BAe/GEC deal resulted in a rash of statements from those left behind in Fance and Germany. Among the comments are:
  • Dasa noted that "if the BAe/GEC merger proceeds as announced, it will make balanced European horizontal mergers such as Dasa-BAe impossible and create an obstacle to European integration. On the basis of its strong economic performance and strategic position DaimlerChrysler/Dasa will now evaluate its other European and transatlantic options." The company added that "it is well known that DaimlerChrysler/Dasa have supported the restructuring of the European aerospace industry and favoured a cross border merger of the relevant companies for a long time. It was in this context that DaimlerChrysler/Dasa had intensive discussions with British Aerospace concerning a bilateral merger of equals between Dasa and BAe as a first step".
  • In Paris, defence minister Alain Richard said: "We have kept telling Dasa we were willing to work together. I think Dasa's directors had doubts for a while about the French will to reorganise their companies for European alliances. We are going in the coming days -- let's say next week -- to finish the reorganisation of Aerospatiale and Matra," he added. "If our partners in Dasa want to go in that direction, everything is ready."
  • After their meeting in Madrid on January 21, ministers from six European nations urged that aerospace companies and governments move forward with the restructuring of the European aerospace and defence sectors. They said the merger of British Aerospace and General Electric Marconi, creating the world's third-largest defence and aerospace firm should help, not hinder integration. The ministers, issued a joint statement calling for a single EADC based on a balanced partnership. "The six ministers said they would continue with work to facilitate the industrial restructuring process," it said. "They stressed that the driving force behind this had to be the establishment of an EADC, which would be globally competitive in the market place. The creation of the Airbus single corporate entity is of central importance," it said. "It is a significant step towards a broader integration of military and civil activities within the future European Aerospace and Defence Company. The ministers...call upon industry to ensure that the new Airbus company is fully in place as soon as possible."
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Eurocopter reports good results for 1998
Erfreuliche Jahresbilanz für Eurocopter

1998 was a satisfactory year for the Eurocopter Group with orders for 272 new helicopters, including: 45 EC 120B Colibri, 73 single-engine Ecureuil/Fennec, 20 twin-engine Ecureuil/Fennec, 16 BO 105, 44 EC 135, 39 BK 117, 28 Dauphin/Panther and 7 Super Puma/Cougar, the company has said on January 21. The total number of orders received, including those for the new and pre-owned helicopters (approximately 60 sold by Eurocopter and its subsidiaries), the research and development activities, the customer support services and miscellaneous activities totaled 11.901 thousand million FRF (3.553 thousand million DM), a figure which exceeded the objectives. These orders can be broken down by value to 66% for the civil and semi-public market and 34% for the military market.
The 1998 turnover is on the order of 11.1 thousand million Francs and is up by 10% compared with 1997. This figure includes the customer support and research and development activities as well as the delivery of 216 new helicopters. 56% of the turnover concerns the civil and semi-public market and 44% the military market. 54% concerns exportation.
Key goals for 199 are the signing of the multiple annual orders for 2 x 80 Tiger helicopters for Germany and for France and the signing of the industrialization contracts and of the initial order for a series of 151 NH 90 helicopters. But also challenges to be met such as: maintaining the excellent market share for our products against highly proactive competitors, consolidating the successful entry into service of the new-range helicopters (EC 120, EC 135, EC 155) and improving our customer support, enhancing the Group's financial profits and adopting the 35-hour working week for Eurocopter's French workforce.

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Kosovo crisis: NATO builds up force
NATO verstärkt Truppen für möglichen Kosovo-Einsatz

With tha latest escalation of the crisis in Kosovo, NATO has decided to reinforce and prepare its forces in the region to be ready for possible air strikes. Germany sent its Tornado ECRs to Piacenza in Italy, while the UK deployed four additional Harrier GR7 ground attack aircraft and an additional tanker aircraft to Italy to join other UK and NATO forces. This brought the total number of RAF aircraft in Italy to eight Harrier GR7s and two tankers.

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Eight airlines interested in buying into South African Airways
Mindestens acht Fluggesellschaften wollen bei SAA einsteigen

At least eight airlines of Europe and America are bidding for a 20 to 25 percent equity stake in South African Airways (SAA) when the state-owned airline is privatized, the company has announced. The bidders are KLM Royal Dutch Airlines and its U.S. partner Northwest Airlines and Germany's Deutsche Lufthansa AG with its partner Singapore Airlines, SAA spokesman Victor Nosi said Thursday. Other airlines also expressing an interest include British Airways, Swissair, Britain-based Virgin Atlantic Airlines and American Airlines, said the spokesman. SAA, part of South Africa's transport parastatal Transnet, has been preparing for privatization since 1995, but the process was hobbled by the talks with its lenders and the restructuring of its four billion Rand (about 666 million U.S. Dollars) debt before being privatized. It was reported that the South African government struck a deal with the SAA last November which could see the state absorb part of SAA's liabilities on Transnet's balance sheet before the carrier was privatized. The government expected SAA's stake to be sold off by the end of May, a senior Transnet official who asked not to be identified disclosed Thursday. The SAA last reported a profit in 1995, but after that the global airline has been reportedly suffering deficit.

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Boeing sells light helicopter lines
MD Helicopters übernimmt Booeings Zivilhubschrauber

On January 19, Boeing has announced that MD Helicopters Holding, Inc., an indirect subsidiary of RDM Holding, Inc., has signed an agreement on an asset purchase of the companies MD 500, MD 600N and MD Explorer series of light commercial helicopter product lines. The sale, which is subject to approval by the U.S. Federal Trade Commission, is expected to be final by mid-February. The sale price was not disclosed.
MD Helicopters said it initially would operate from existing Boeing facilities at Mesa's Falcon Field Airport. The company said it would construct new local facilities at a later date. Boeing will provide technical and engineering support under contract to MD Helicopters. RDM is a European-based industrial group with aerospace activities. The company designs and builds diesel-electric submarines and builds and repairs ships, manufactures and overhauls military vehicles, and produces defense and aerospace products, including landing gear and transmissions for aircraft and helicopters. It is a subcontractor to Boeing for landing gear and fuselage assemblies for Apache helicopters.
Boeing delivered 36 helicopters from its commercial product lines in 1998, up from 30 delivered in 1997. Last year's deliveries included the first eight of 45 MD 600Ns sought by the U.S. Border Patrol and the first four MD Explorers in its advanced 902 configuration. These aircraft were delivered to customers in Japan and the United Kingdom. Boeing took orders for 22 helicopters in 1998.

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Ukraine still hopes on An-70 for NATO
An-70 Angebot für neuen NATO-Tansporter?

Valery Kozakov, deputy head of Ukraine's ministry for industrial policy, has revealed that experts from several German companies were in Kiev for talks on setting up a joint group with Ukraine and Russia to work on a new, turboprop military transport in response to the RFP which closes on January 29. "If we reach an agreement, we will present our An-7-X craft together with Germany at the tender," he said.

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NEWS IN BRIEF / KURZMELDUNGEN

After their merger with Continental Airlines, Copa, a Panamanian airline, has confirmed it will be purchasing eight new aircraft from Boeing and not its rival Airbus Industrie with whom it had also been negotiating. In a contract worth US$516m Copa announced on January 19 that it will buy eight new Boeing 737-700 aircraft, and will be renting four others from Tombo and General Electric Capital Aviation Services. The acquisition will allow Copa to almost double its annual passenger volume of 900,000 within five years. The first four jets will delivered from April to October 1999, and the remaining eight will be delivered between 2000 and 2001.
+++
Ryukyu Air Commuter (RAC) of Naha, Okinawa has placed a firm order with Bombardier Aerospace for one Dash 8 Q100 aircraft. The contract is valued in excess of $12.5 million U.S. ($19 million Cdn.). The aircraft will be delivered December 1999. RAC, a subsidiary of Japan TransOcean Air and a member of the Japan Airlines group of companies, became the first Japanese customer for the Dash 8 when it ordered three of the 39-seat aircraft and took options on a further two in February 1996.
+++
Cooperation in the are of space exploration between Russia and European countries, particularly with Germany is of "principal character for us," head of the Russian Space Agency Yuri Koptev said in Bonn, where he attended a Russian-German seminar on space cooperation possibilities, which is being held at the Russian embassy. The forum is being attended by representatives from Germany's leading aerospace, electricals, telecommunications, consulting and other companies.
+++
Rolls-Royce has announced that the Trent 8104 engine has exceeded 110,000 lb thrust during initial test runs. The Trent 8104 is proving new technologies which will benefit all new members of the Trent series, the most successful family of large aero engines on offer in the world today. Innovative features include the new "swept" fan blade, which introduces the fourth generation of advanced design, maintaining the company's world leadership in wide-chord fan technology. The advanced aerofoil design passes a greater airflow and delivers improvements in fuel efficiency. The "swept" blades are also stronger, increasing resistance to bird strike impact and runway debris. The Trent 8104 is the latest member of the successful Trent family and, at 104,000 lbs thrust, is the highest thrust engine on offer in the world, for Boeing 777-200X/300X aircraft.
+++
DAG and ÖTV unions have demanded a 7,5 per cent pay rise for Lufthansa staff, so that the good financial situation of the carrier filters through to the workers. Management has rebuffed this "excessive" demand.
+++
The German government plans to open discussion on taxation of aviation fuel in the European Union soon. Transport minister Müntefering wants to take results of new studies to push for this taxation, but it seems difficult to get through as not all 15 members are expected to agree.
+++
The German authorities have approved the PARS 3MR anti-tank missile for introduction in the armed forces. This paves the way for the signature of an MoU by the five participating nations (France, UK, Netherland, Belgium and Germany) covering production investment and production. It is expected that this can be achieved by mid-1999.
+++
Arianespace Chairman Jean-Marie Luton is expanding and reorganizing his management team to strengthen the company's industrial management in order to improve Ariane 5 competitiveness, and in anticipation of global market diversification. Jacques Rossignol has been named Executive Vice President, an appointment that will enable Arianespace to enhance its industrial and operational effectiveness, within a demanding, aggressively competitive market. Arianespace also has created two new divisions, each reporting directly to Chairman and CEO Jean-Marie Luton and coordinated by Secretary General Francoise Bouzitat. These new divisions will enable Arianespace to intensify its strategic analysis of the development of the company and its products, along with international initiatives and communications. Jean-Max Puech, 40, has been named head of the Strategy and Planning Division, while Jerome Paolini, 37, has been named head of the International Business and Communications Division. To further strengthen Arianespace's sales and marketing capabilities, Philippe Berterottierre has been named Director of Sales.
+++
According to a report on January 19 Lufthansa is considering shares in Air India as part of that airlines disinvestment process. Lufthansa will make its decision after it has reviewed the Indian government's guidelines for the disinvestment procedure. In other news, Lufthansa may be increasing services to Delhi, Mumbai and Chennai and may expand to other Indian cities such as Bangalore, Hyderabad and Calcutta.
+++
The Central European Air Traffic Services (CEATS) Coordination Group has opted for Vienna as the location of the future CEATS Centre. The decision of the Directors General of Civil Aviation will be submitted to the CEATS Ministers of Trsnport, before presenting them for formal endorsement to hte Eurocontrol Provisional Council and Commission on 23 April 1999. CEATS will control the upper airspace of Austria, Italy, Hungary, Slovenia, Slovakia, Croatia, the Czech Republic and Bosnia Herzegovina. The Centre will be assisted by several support facilities, like a research cente in Budapest, a training centre in Forli-Rimini and an Office in Prague.
+++
Tyrolean Airways will add the Vienna - Berne route to its network on April 12. It will be served eleven times a week by Dash 8-100 turboprops.
+++
United Airlines confirmed that it's seeking to acquire America West Airlines. In a statement, the airline said, "United Airlines confirms that it has expressed to America West Airlines an interest in a possible acquisition of America West." America West Holdings Corp., based in Phoenix, also issued a statement that it had been contacted by "a number of airlines" seeking to merge, join in a strategic alliance or acquire the ninth-largest U.S. airline. America West didn't name the specific airlines courting it, and said it would refuse any comment before such an agreement is reached. United, based in the Chicago area, is the largest airline of the US.
+++
The first Super Hornet squadron VFA-122 was established at Naval Air Station Lemoore, Calif., on Jan. 15. The newly formed squadron is a Fleet Readiness Squadron responsible for aircrew and maintenance training in the Navy's newest tactical aircraft. The new squadron currently consists of about 60 personnel but is expected to grow to more than 500 over the next several years. "Our mission is to train Super Hornet aviators and maintainers to project power from the sea, to put fuzed ordnance on target, the first pass, on time, day or night, anywhere," explained Fox. "There is an enormous amount of very detailed work that must be done to prepare for this airplane to go to sea and to operate as part of the fleet."
+++
Lockheed Martin has been awarded a $450 million C-5 Avionics Modernization Program (AMP) contract to integrate an advanced flight control and communication/navigation system, as well as instrument displays, in U.S. Air Force Galaxy transport aircraft. Under the program, the Lockheed Martin team will modernize the C-5 avionics system to meet Global Air Traffic Management (GATM) requirements for operating a worldwide mission in the 21st century. Development and flight test work will be done in Marietta, while installation of the avionics system into operational aircraft will be done at Air Force bases by Lockheed Martin field teams. LMAS has teamed with Honeywell Defense Avionics Systems to integrate the Honeywell Versatile Integrated Avionics (VIA) system, used on many of today's commercial aircraft. The avionics package also includes six flat panel liquid crystal displays like those used on the C-130J for flight and engine instruments.
+++
German regional airline Eurowings has reported another record year for 1998, boosting its capacities on scheduled routes as well as its charter activities. Nearly three million passengers were carried, afte 2,5 million in 1997. As capacities were also increased, seat occupancy fell 3,8 percentage points to 53,5 per cent (72,6 per cent on charter flights).
+++
CargoLifter AG has announced the "conceptual design freeze" for its CL-160 super large freighter airship. which is to fly in 2001. It will be 260 m long and have a diameter of 61 metres, a bit larger than before. CargoLifter is also seeking new money to pay for development and erection of a large hangar in Brand, south of Berlin.
+++
An Air India Boeing 747 nearly met disaster at Frankfurt airport on January 21, when it was short on finals and erased part of the runway lighting before going around in heavy fog. As an ILS was also put out of order, many delays resulted for the congested airport before reipais could be effected.
+++

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Previous updates are still available:
Die News der letzten Wochen sind weiter abrufbar:

*January 17, 1999 *January 10, 1999

*December 20, 1998 *December 13, 1998 *December 6, 1998

*November 29, 1998 *November 22, 1998 *November 15, 1998 *November 8, 1998 *November 1, 1998

*October 25, 1998 *October 18, 1998

*January to September 1998 *January to December 1997 *September to December 1996

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Last updated January 22, 1998
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